By Steve Davis - October 3, 2011

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In anticipation of the retail market that state insurance exchanges will create in 2014, some health plan operators are trying to recast themselves as consumer-friendly entities focused on helping members improve the quality of their lives.

UnitedHealth Group, for example, launched a campaign late last summer called "Health In Numbers," which is designed to help people better understand the role the insurer can play in helping them “get back to the lives they want to lead,” says spokesperson Daryl Richard. This month, the company opened a retail storefront in Hempstead, N.Y. to serve Medicaid members. Blues plan operator Highmark Inc. has opened several retail shops in Pennsylvania.

Cigna Corp. said Sept. 19 that it is investing $25 million on corporate rebranding and new marketing efforts that will promote its products in TV and magazine ads as well as through social media sites. The company also has launched an interactive home page and pruned its 18-year-old tree-of-life logo to make it appear less corporate and stopped referring to itself as CIGNA (all caps).

I asked Fred Karutz, general manager of health plan solutions at Silverlink Communications, for his take on this trend. Fred is spent 10 years as a corporate vice president at Health Care Service Corp., which operates Blue Cross and Blue Shield plans in four states. Here’s what he wrote:

Health plans realize that they are in a game changing transitional market that will require transformational thinking about how they build their brand and create new frameworks on relating to and engaging consumers. When we look at the end of the decade, based on analysis and talking to plans, we see that there is a fundamental change in the healthcare market from wholesale to retail. We see as many as 200 million consumers getting access to retail-like setting. The challenge for health plans is that retail is different than wholesale. Retail is more expensive and all about consumer engagement that is personalized, timely and accessible. This accessibility is according to each specific consumer’s definition of accessibility which could range from mobile applications, emails and live calls to interactive voice recognition. The fact that retail is more expensive than wholesale will also be a challenge to health plans because most health plans are looking to cut costs in this costs do matter environment. Health plans need to deploy better, faster, cheaper solutions to make retail work for them in a cost effective fashion. So plans need to learn new moves to succeed in a retail market. To learn new moves, health plans need to start with three steps. The first step is getting better individual consumer data. Plans need to not only scrub data but also find ways to get more personalized consumer data in order to reach their member base in a more effective way. This could mean the ability to use cell phone numbers and finding out if that cell phone is a smart phone as a way to use mobile apps. This also means collecting member preferences on how they want to be communicated with. The second step is having the flexibility to apply rules in this era of evolving regulations as well as respecting consumer opt-in preferences. Health plans need to be able to quickly and effectively manage compliance. That means being able to apply rules based on regulation, consumer opt-in preferences to better engage their members on a personalized level all while having an audit trail. The last step is putting a technology platform in place that creates a feedback loop with communications history in order to use solutions and outreach methods that are proven to work. With this kind of technology platform, plans can get rid of outdated approaches that are not accessible and not effective with consumers which will in turn save them money. And when you think about retail branding, plans understand that their brand is more than just consumer awareness, it is ultimately a reflection of everything they do for their customers and a scorecard of all the customer facing activities and services provided to members.