Healthcare consumerism is the idea that individuals are empowered to make informed choices about their care and coverage. It is reshaping the industry and providers dominate most conversations about healthcare consumerism. Health systems, specialty practices, primary care physicians, telehealth providers and even retailers like Walmart and CVS have been steadily claiming their stake in the market.
Health plans have lagged behind, but that needs to change in a big way.
It wasn’t long ago that payers were almost solely focused on crunching numbers. They simply needed to get the risk and underwriting correct, and then cut checks when members needed healthcare services. If we’re being honest, insurance companies wanted minimal engagement with members, because most contact meant they were spending money. But the feeling was mutual, people didn’t want to talk to their insurance company either; they just wanted their claims processed.
With that background, it’s no wonder that health plans have earned a dismal reputation for customer experience. In fact, Forrester issued its “2025 US Health Insurers Experience Rankings” recently, placing health insurers last among all industries the firm tracks for customer experience.
This should be a wakeup call for health plans. We’re in the middle of a fundamental shift that’s giving consumers more power and choice over their health coverage while creating healthy competition in the marketplace. Consumer expectations are justifiably rising, and people want a much more pleasant, frictionless and digital experience from their health plan – just like they get everyplace else in their lives.
The market factors driving this shift are only gaining steam.
The first major driver is consumer choice. As reliance on employer-sponsored plans declines, individuals are increasingly selecting coverage themselves. This year, more than 24 million Americans selected or were re-enrolled in coverage through ACA exchanges. More than 30 million Americans are now covered through Medicare Advantage plans, which surpassed traditional Medicare back in 2023. And ICHRAs, where companies give employees pre-tax dollars to shop for their own coverage, grew by 29% between 2023 and 2024. The bottom line is that the market is becoming less reliant on employer-sponsored healthcare, which means that health plans now must attract and sell to consumers directly, and not just HR reps.
Even though reliance on employer-sponsored plans is fading, the commercial market is still adding to the pressure for better experiences too. In competitive job markets, benefits play a significant role in attracting and retaining top talent. The best companies, that want to hire the best talent, need to offer more and better options for health coverage.
Finally, technology is making healthcare markets more accessible than they’ve ever been before. Healthcare coverage is extremely complex and has historically been too difficult for individuals to navigate beyond simply picking the most expensive plan if they expect high utilization, or the least expensive if they think they’re healthy. Beyond that, no one has the patience to review plans or spend hours on the phone trying to get answers to pick the right one. But that’s not the reality we live in anymore thanks to technology that’s already here – and getting better every day.
Health plans’ biggest asset is data. They have more access to data about individuals than almost anyone. Retailers like Amazon and Walmart are the gold standard for delivering personalized experiences, but the data they have access to pales in comparison to the information a health plan has. Health plans can and should use that data to recommend and personalize coverage to make shopping for a health plan easier. Perhaps more importantly, they can and should use that data to deliver better, more personalized care too.
Health plans must evolve from transactional entities to trusted partners in care. By harnessing their data and delivering seamless, personalized experiences, they can become central players in the consumer-driven future of healthcare.
Photo: Mykyta Dolmatov, Getty Images
Alan Stein has nearly three decades of experience advising health plans on technology, and helping to develop the systems that power their most important value streams. He is currently Chief Product & Strategy Officer at HealthEdge where he works to advance the HealthEdge product suite, with an eye on alignment and interdependency across the business. Prior to HealthEdge, Alan had an extensive career as a senior executive at TriZetto, leading its $2.7 billion sale to Cognizant, where he then served as a Senior Vice President overseeing the Healthcare Products Group.
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