Thrust into new competition, insurers ramp up customer service

SAN FRANCISCO _ Cutting inscrutable health-insurance jargon out of their communications. Opening retail stores to answer people's questions and offer wellness classes. Measuring customer-service efforts to give callers a better experience.

More insurance carriers are ramping up their services as they prepare to compete for millions of new customers starting in 2014, due to the new health-reform law. That's the year health insurers will be banned from refusing coverage to people with preexisting conditions or charging them exorbitant rates, and the first time individuals will have to carry health insurance or face a financial penalty.

Such changes are driving some health insurers to try to meet people where they are _ both physically with retail stores and enhanced phone-based customer service and virtually, by tracking negative comments online and intervening to help improve people's experiences with their health plans.

"We see the stakes in terms of customer service going higher and higher," said Joe Mondy, a spokesman for Cigna, a health insurer in Bloomfield, Conn.

The arrival of a new era in health care has Highmark Inc., a Blue Cross Blue Shield carrier in western and central Pennsylvania, broadening its focus beyond just acquiring new customers, said Matt Fidler, director of retail marketing for Highmark in Pittsburgh.

The company has attracted 20,000 visitors to its first two Highmark Direct retail stores since opening them in March 2009, he said. It's planning to open three more storefront operations in Pittsburgh and one in Harrisburg by September.

Highmark Direct stores offer a self-service area with kiosks and machines to take simple health measures, plus convertible classrooms and places where people can ask questions and work with staff on coverage or billing problems they may have. The stores are open Monday through Saturday until 7 p.m. and are staffed by Highmark employees who don't work on commission. In the future, the stores may draw health-plan customers for wellness classes such as smoking cessation or prenatal yoga.

People already use the stores to wade through the intricacies of plan designs, particularly high-deductible health plans and health savings accounts, Fidler said.

"Folks are confused now about health insurance," he said. "It's going to get more confusing with reform before the tide turns.

Fidler said a typical dialogue in the not-too-distant future may consist of a customer disclosing that he'd recently been diagnosed with diabetes and asking what Highmark can do to help. Health-plan members should expect Highmark to have programs to support them through a disconcerting time, he said, and the stores make it easier to engage people.

Highmark is working towards being seen as a "trusted adviser" when the biggest health-reform changes kick in, he said. "We have to start to build those experiences now so when reform hits we've got a population who knows we're there to assist them."

Under the new health-reform law signed by President Barack Obama in March, by 2019 about 24 million Americans will gain health insurance by buying private coverage in regulated marketplaces called exchanges, according to estimates from the Congressional Budget Office.

In 2014, many people without employer coverage who earn too much to qualify for an expanded Medicaid program will be able to buy their own health insurance through the exchanges, said Sara Collins, a vice president at the Commonwealth Fund, a private foundation in New York. Premium subsidies to make it more affordable will be available for those with income up to 400 percent of the federal poverty level, or about $88,000 a year for a family of four.

"You're required by 2014 to have insurance, so the onus is going to be on individuals to find coverage if they don't have it," she said. "There will be a lot of federal dollars flowing through the exchanges to help people buy coverage."

In three years, health plans will look more uniform as an essential benefits package takes effect in the exchanges; that package will vary mostly by cost-sharing levels as opposed to covered services. Among four types, the bronze plan, for example, may carry a higher deductible in exchange for a lower premium while consumers who want more protection up front may find the opposite benefit design in the platinum plan.

With those changes approaching, many insurers are trying to stand apart from their rivals as they offer increasingly similar products, experts say.

"Payers will definitely have to become more member-centric to differentiate on the member experience itself because the actual plans they provide will become commoditized," said Ralph Alewine, principal with Booz & Co. in Atlanta. "We foresee the day coming very soon where payers will start to advertise their ranking in customer service" surveys akin to what life insurers do.

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At Cigna, all 27,000 U.S. workers are trained to use clear language and avoid words such as "health-care provider" and "member" because of the confusion they create, said Mondy, the company spokesman.

"We couldn't continue to pretend like the people we were talking to understood what we were saying," he said.

The transition has been playful at times. Some employees keep the equivalent of swear jars where those who slip up and use forbidden jargon deposit loose change as a penalty, Mondy said.

Front-line customer-service workers are so important to the company's mission that they were the only ones exempted from a freeze on merit pay raises during the recession, he said. Last year, Cigna opened its customer service lines 24 hours a day to better accommodate needs such as emergency inquiries from travelers.

The company also patrols blogs and Twitter for mentions of Cigna and contacts people directly to correct misinformation and address service complaints, Mondy said.

"Our entire philosophy with social media is: Listen first," he said. "It's not a vehicle for us to push out information as much as to gather it."

And in January, Cigna overhauled its explanation of benefits forms, known in more acronym-tolerant quarters as EOBs, in an effort to cut customer confusion and resulting call volume.

Because of these customer-service investments, Cigna is well positioned to adapt to coming changes in the insurance market, Mondy said. "We feel really good about the fact that we've been headed in the right direction for a few years now."

As Americans start to have more coverage options in the next few years, it will be a "moment of truth" for health plans that typically haven't competed on customer service, said Christine Kowalczyk, vice president of health-care services for Convergys, in Cincinnati.

Three of the nation's top health insurers use Convergys to handle calls from people dialing the 1-800 numbers on their insurance cards, she said. Callers should have a seamless and uniform experience that resolves their issue the first time, whether they're routed to an agent in the U.S., the Philippines or India.

"If we're doing our job and properly training our agents, we shouldn't have to transfer you several times or not answer your questions or have to call you back," Kowalczyk said.

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Customer-service representatives aim to find a delicate balance by using empathetic phrases like "I apologize," "I understand" and "I'm sorry to hear that" while at the same time completing a task in a reasonable time frame, Kowalczyk said.

Convergys also conducts follow-up surveys with callers and does predictive modeling to help client companies determine the likelihood that a customer will drop her health plan when given the chance based on the words she uses during the call.

"What we can bring is best practices about how you treat the consumer and the best way possible to drive that loyalty," she said. "It's up to us to help (clients) create a better experience for their customers."

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