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When the Disruptor is the Disruptee

By Dennis Bolin, Health Plan Alliance, June 28, 2016

I don’t know about you but I am becoming tired of hearing about “disruption” in the health insurance industry. I hear and read the term everywhere and I wonder if it is overused. I just returned from this year’s AHIP Institute and I heard the term repeatedly in presentations and discussions. Whether the word used is “revolution,” “transformation,” “innovation,” or “reimagining,” the pressure to integrate to “make it happen” is mounting. Clayton Christensen defines “it” as “combining, through a coordinated effort, the business models that must comprise the disruptive value network.”

The concept of disruption as a business strategy has been popularized by Christensen’s work. We had a member of his firm present at an Alliance meeting years ago – when the concept was still new – and we have been following the evolution ever since. In his book on the health care industry The Innovator’s Prescription Christensen says health care disruption is likely to come from 3 sources: 

  • Employers 
  • Corporate orchestrators
  • Integrated fixed-fee providers


At the Alliance’s recent Health System/Health Plan Value Visit we discussed with a Boeing executive that company’s initiatives to wrestle with health care costs, standardize quality and improve the customer experience. While we have heard about the strategy from Alliance member Providence Health Plan, I gained insights hearing it from the employer’s perspective. They have rolled out their strategy to a second market and anticipate a third market in 2017. In each case they identified a delivery system and provider network as their partner, driving costs, innovation and market share. More of our system owners are hearing directly from employers.

Corporate orchestrators

New entrepreneurial, venture capital-backed companies – corporate orchestrators – are also reshaping markets. Four are receiving a lot of attention:

  • Oscar. Now in 4 states (New York, New Jersey, Texas and California) and 140,000 members Oscar is changing the market by introducing a technology-driven consumer-friendly product. I met with the CEO of Oscar 4 years ago when all they had was a group of programmers in a nearly empty loft in SOHO. Only 2 of the senior team came from the health insurance industry and they were sure they could do it better. An example:  a PCP receives a real-time text message of a member in an emergency room with a pin number used to call the member. The physician is paid $24 to call the patient within hours.
  • Clover. A Medicare Advantage plan, they anticipate targeting only a small number of states. They are differentiating themselves through the use and availability of data. Using a cloud structure they do not have to worry about systems talking to each other. Instead data is deposited and accessed according to agreements on guidelines of usage.
  • Harken Health. Their model is focused on primary care centers and offer insurance to small groups and individuals on and off the exchange. They currently are in Chicago and Atlanta. United is an investor.
  • Bright Health Inc. They are unique in that as an insurance company they partner with a single provider system in the market to drive market share and partner to offer affordability and a differentiated customer experience. They anticipate entering the Colorado market in 2017.

Integrated Fixed-fee Providers

Christensen says that the challenge for integrated fixed-fee providers, such as Alliance members is that we are both the disruptee and the disruptor. In other words we are turning our own business and care models on their heads. In a truly integrated system the incentives are to keep people well. But flipping the switch on our business is not easy in ways the start-up disruptors can build from scratch. But we have one advantage:  we have all the components while none of the start ups do.

And integrated systems have the components necessary to create an enhanced enterprise-wide customer experience. Chris Fanning with Geisinger Health Plan shared their enterprise approach to customer experience at our Health System/Health Plan Value Visit. He will be going in-depth on their enterprise-wide Member Journey Roadmap at our Customer and Employer Market Strategies Value Visit July 19 – 21, click here for event information.  Geisinger has identified guiding principles around which they are organizing their customer-centered initiatives:

  • Navigate – helping members make their way through the health system and make decisions right for them.
  • Anticipate – help members know what to expect and help them with their needs in advance.
  • Simplify – make the health system, health plan, and physician groups easier to do business with.
  • Earn Trust – help members select the right plan based on their needs and work closely to resolve issues and assist beyond the traditional payer role.
  • Individualize – Customize and personalize information and communication to meet specific interests and needs

As Christensen counsels, being the disruptee as well as the disruptor is a demanding but not an impossible expectation. He points out that integrated fixed-fee providers are uniquely positioned to shift care to the most cost effective site possible, to coordinate care, to manage a population’s health, to give tools to consumers to make decisions and manage their health and to provide a distinctive customer experience. And every time Alliance members gather to discuss our initiatives we get more disruptive.

This post originally apperared on the Health Plan Alliance Blog on June 28th, 2016. You can see the original at and see all the Health Plan Alliance Blog posts at

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