How To Not Loose Money In Health IIC - AK Sigorta (2014)

1. How to not loose
money in Health
IIC
26 September 2014

2. How to make Health profitable?
Excellence across all parts of the value chain is needed
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3. 3
Some examples of supporting elements to make Health profitable
Distribution2
Product Design1
 Introduce copayments
 Bundling of products can allow to enhance the value proposition
while controlling the frequency
 Develop intuitive and easy to use front screens
 Have a specialised Direct Sales Force
 Control the weight of your ‘bleeders’
 Ensure an end to end sales process that takes less than 10 minutes
Underwriting3
 Have more than 95% automatically approved
 Fraud detection
 Pricing including some non-clinical risk factors like:
 Income
 Job
 Area of residence
 Leisure activities

4. 4
Some examples of supporting elements to make Health profitable
Network Mgt5
Claims
Handling
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 Utilisation management
Eg insurer determines which surgeries to be done on a day-case
 Case Management
 Need scale for negotiation power
 Smart negotiation process (eg more proactive follow-up of peer providers)
 Contracting set-up; from fee per service towards package fees or capitation
IT &
Infrastructure
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 Automated
 Integrated with medical providers
Service7  Managed Care

5. Consistent good performance on all levers is required
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Consistenly scoring high on all
levers will allow to build a product
and offer it at a price that would
never have been possible before

6. Example of successful Health operation in Portugal: Medis
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UNDERWRITING
UTILIZATION
REVIEW AND CASE
MANAGEMENT
CLINICAL
CARE
ASSISTANCE
PROVIDER
NETWORK
SYSTEMS
DESCRIPTION OF SKILLS
Ability to develop actuarially based prices and underwriting
standards
Ability to develop a telephone customer service unit that
provides primary care advice and channeling
Ability to design a high quality cost effective provider network
Ability to negotiate with local providers including extensive local
contacts, knowledge of relative quality levels of providers and an
understanding of provider needs
Ability to develop standards for controlling medical costs while
maintaining or improving quality of care given
Ability to set medical care standards that are locally acceptable
Ability to set up a specialized IT system to support
healthcare line of business
Ability to design an integrated systems network

7. Medis – Key Figures
Claims ratio decreasing since 2009 and significantly below market
average
Lower claims ratios are achieved through:
 Higher prices due to higher level of service provided to Medis
customers
 Quality of the Medis Operations
 Medis Provider Network Control
Profit before taxes (million EUR)
Gross Written Premiums Claims Ratio

8. THANK YOU
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