Preparing for Health Reform

 A New York Times article by “Insurers Seek to Soften Their Image, No Matter How Court Rules on Health Act” examines what health insurance companies are doing to reposition themselves as consumer-friendly as they prepare for the possibility of millions of new customers owing to the Affordable Care Act. If the court upholds the most controversial provision in the legislation — the individual mandate —  it would require people to buy health insurance or face a fine.

The Individual Mandate Makes No Difference

Some pundits like Lawrence O’Donnel on The Last Word, have pointed out that the mandate is not a mandate at all, and that, aside from a small tax penalty of a few hundred dollars, there’s no real enforcement mechanism in it. If the penalty isn’t paid, there are no penalties, civil or criminal. O’Donnell detailed the two ways in which Obama’s law addresses this issue:

“In the section called ‘Waiver of Criminal Penalties,’ it says ‘In the case of any failure by a taxpayer to timely pay any penalty imposed by this section, such taxpayer shall not be subject to any criminal prosecution or penalty with respect to such failure.'” Another key component is the “Limitations on liens and levies.” That reads, “The Secretary shall not file notice of lien with respect to any property of a taxpayer by reason of any failure to pay the penalty imposed by this section, or levy on any such property with respect to such failure.”

Anticipating An Influx of New Customers: Fred Karutz, the general manager of health plan solutions at Silverlink Communications, a health care technology company, said that if the health care overhaul was left intact by the court, as many as 120 million Americans could be in the market for health insurance by the end of the decade. University of Minnesota professor Lawrence Jacobs states that insurers withdrew their support for the bill after learning that the the mandate had no teeth. One concern of the insurance companies is that the law could force insurance companies to extend coverage to tens of millions of uninsured Americans, regardless of pre-existing medical conditions, and, without a mandate, pricing will be difficult, and premium costs could increase.

However, the mandate, Jacobs says, only affects about 1 out of 20 Americans or, maybe 2 out of 100 after the subsidies and some exceptions, and “is simply not that big a deal:”

The big story here is the insurance regulations that make the insurers play fair rules so they don`t screw you, the enormous efforts to expand access to over 30 million Americans, both lower income, middle income, up to $90,000 a year for a family of four, and then a brand-new insurance exchange, kind of like a Travelocity, so you can go out there and do some comparison shopping.

Consumer-Based Messaging

Of course, the ACA is a big deal for insurers, and regardless of the mandate, the creation of exchanges means an influx of customers for the health insurers.

While a majority of Americans would still be left to choose among the options their employers offer, a favorable ruling would expand the market for the insurance companies, allowing them to sell directly to millions of uninsured Americans. But insurers say that even if the mandate is struck down, they will press forward with their strategy because future success will depend on engaging directly with the consumer. Michael B. McCallister, chairman and chief executive of Humana, says:

I expect to see a fair amount of competition for the public’s attention. The individual relationship is going to be ever more important.

Consumer Based Marketing:  The campaigns represent a departure for insurers, who had previously directed their marketing to wholesale business accounts, not individual consumers. The new efforts include themed messages, as well as loyalty and rewards programs that take a page directly from the marketing playbook of traditional retailers. Along with their new advertising campaigns, several insurers are introducing new digital products, including some that seem to borrow equally from shopping comparison sites, airline loyalty programs and Groupon.

Insurance companies have been spending more on their marketing and advertising efforts. According to Kantar Media, a research unit of WPP, spending on medical and dental insurance advertising increased to $789.3 million in 2011 from $667.7 million dollars in 2010.

“Insurance is a large-numbers business,” Mr. Karutz said. “The marketing push is for nonbuyers, the people who are ambivalent.” By nabbing new customers, sick, old, young and healthy, the companies can create “a balanced risk pool” he added.

Here are some examples of the ad campaigns they are using to prepare to compete in this new market space:


Cigna’s “Go You” campaign attempts to put the focus back on the consumer. With this campaign, Cigna addresses consumers directly for the first time. “It is a shift, it’s an important shift,” said Maggie FitzPatrick, the chief communications officer at Cigna. The campaign includes bold colored ads with more personal messages like: “Why would you want to be like someone else? Its exhausting just trying to be yourself.”

Emblem Health

EmblemHealth’s advertising campaign focuses on telling stories of its employees and sending its members a message that insurance can be personal. Some of the ads are large billboards placed at major intersections and landmarks in New York City, like Madison Square Garden. One ad, which quotes from Sonia, an Emblem employee, reads, “You really develop a connection with someone when you can look in their eyes and help.”


Humana’s new approach has been described as “bright, honest, aware and bold.” One television ad the company released in 2011 showed a family reunion at a summer home, complete with giggling children, cooing grandparents, bonfires and swimming at the lake.  Humana has created a program that rewards members for healthy behavior like losing weight or quitting smoking, awarding points that can be redeemed for things like hotel reservations, electronics and clothing.


In January, Aetna announced it, too, was refreshing its brand to continue “its evolution from an insurance carrier to a health solutions company,” the company said in a statement. “More and more, the end consumer is who we need to focus on,” said Belinda Lang, the head of brand and consumer marketing at Aetna. This includes a new purple logo that is vibrant, energetic and flexible to reflect the brand promise of “showing our passion for helping you feel confident in your health care decisions, fitting into your life, and making it easier for you to live healthier.”

Aetna introduced a digital tool that allows consumers to compare out-of-pocket expenses. The narrator of its ad says, “Ah, the potential of putting people first.”

Aetna and Earvin “Magic” Johnson have also launched a multi-media advertising campaign in major urban markets across America, and an interactive web site, designed to “edu-tain” – or educate and entertain people on the issues of health literacy, wellness and healthy behaviors, and racial and ethnic inequality in health care. These new initiatives, together with planned appearances, reflect the vitality and momentum of the groundbreaking partnership established between the two organizations earlier this year.

In addition to encouraging healthy food choices and more physical activity, the advertisements invite people to visit The web site aims to provide simple, clear information that people can use to make healthier lifestyle changes. Visitors can find usable information including simple information on how to plan for a doctor’s visit, questions to ask if you’re having surgery, healthy eating on a budget, questions to ask your pharmacist, dental health information and others.

Visitors also will be able to stop in to a virtual fast food restaurant where they can learn how many calories are in common choices such as a slice of pizza or fried chicken, and how much exercise that food choice might take to burn off.

The site also features healthy alternative food choices and recipes created by Roneice Weaver, M.S., R.D., L.D. a founding partner and executive director of Hebni Nutrition Consultants, Inc., developer of the original Soul Food Pyramid — a culturally sensitive food guide – and co-author of several healthy soul food cookbooks.

The advertisements, web site and printable materials on the web site are available today in English, and will be available beginning September 15, in Spanish and Mandarin Chinese.  The full suite of advertisements is posted at

Blue Cross and Blue Shield

One of the biggest insurers in the country, the Blue Cross and Blue Shield Association, recently updated its daily deals Web site, which offers members discounts on things like eye surgery and gym memberships.

One of Blue Cross’s initiatives is to appeal to Millennials(Gen Y) as shown in the ad above, using a direct response TV targeted to 18-34 year olds.  The effort tailors the product offering to meet Millennials’ specific needs, and help them realize that health coverage is both needed and affordable, and to focus heavily on alternative medicine such as yoga, massage therapy, and acupuncture. The campaign speaks in a relevant voice  with language was carefully targeted to appeal to a younger audience, comparing the monthly premium to the price of concert tickets, and leverages visual cues and media appropriate to a younger, web-savvy target audience. The call to action is to call or visit the Website for additional information — a basic, but effective, lead generation effort.

The spots were aimed not only at recruiting new health care subscribers, but at rebranding the health insurer’s name and image for a younger, hipper market.

Leveraging the fact that many younger people today respect the opinions of their parents, the spot makes the point that this is “the coverage trusted by your mom and dad.” The insurer knows that this younger audience should recognize the name and corporate logo and — as a result of rebranding efforts — presents an opportunity to relate them to a more innovative and flexible health care option.

As is true in using television or free-standing inserts to target an older audience, targeting a younger group requires continual testing to determine a control position. The goal of using a broad-reaching medium is to have younger prospects cost-effectively self-select. Using this approach, it is possible to reach and influence a younger prospect for your product or service where leads have been traditionally difficult to reach.

The campaign is credited with growing Blue Cross Blue Shield’s subscriber base by 15%.

Highmark Blue Shield of Pennsylvania is featuring some of their 20,000 employees in TV, radio, billboard and newspaper advertisements across Highmark’s Pennsylvania service area.

The Challenge of Putting People First

Putting people first is not a phrase many consumers associate with health insurers, which are typically associated with bureaucracy, rising premiums and declined coverage. The bright, bold people themed advertising campaigns are an attempt by health insurance companies to humanize themselves and “to make the patient believe that the health insurance company really cares about them and to reassure the customer that they get what they pay for,” said Nora J. Rifon, a professor in the department of advertising, public relations and retailing at Michigan State University.

 Dr. Elliott S. Fisher, director of the Center for Population Health at the Dartmouth Institute for Health Policy and Clinical Practice, said the campaigns were necessary regardless of the outcome of the Supreme Court case involving the individual mandate portion of the ACA.

Their future is going to depend on their ability to demonstrate value to patients and to employers. No one any longer questions the fact that health care is unaffordable and that the current way we are doing business isn’t working.

One challenge is that many of them are new to the retail environment where consumers seek out value.

Snap! principle of consumer based health care marketing:

Focus on the consumer’s values and beliefs first.