How Health Plans Can Win in Medicare Advantage with Digital Enablement

As 10,000 baby boomers daily age into Medicare, their health expectations demand that Medicare Advantage plans rethink their approach to digital health engagement.

Even before the pandemic, data showed that baby boomers—especially digital boomers, those between the ages of 56 and 74—increasingly leaned toward digital health technologies:

• An early 2020 analysis found that 76% of consumers 60 and over made a healthcare-related search online in 2019, and 67% of them agreed that availability of relevant and accurate information online impacted their decision to seek one care provider over another
• A 2019 survey found 52% of seniors were willing to try telehealth, and 73% cited the ability to gain faster access to care as a motivation¹

Now, as social isolation during the pandemic prompts seniors to expand their use of mobile technologies, Medicare Advantage plans must consider how to develop digital enablement strategies that attract and retain tech-savvy members.²

The Business Case for Digital Innovation

While COVID-19 created a catalyst for innovation around Medicare Advantage, healthcare disruptors focused their attention on this population long before the pandemic.

With one in three seniors currently enrolled in Medicare Advantage plans—and market penetration projected to rise close to 50% by 2029—retailers and health tech startups view Medicare Advantage as a lucrative opportunity to gain a foothold in healthcare by managing a population that is ready for an outside-the-box approach to managing care.

One differentiator these leaders rely on: the ability to leverage technology and data to engage seniors.

Consider Walmart, which partnered with Clover Health to offer Medicare Advantage to seniors in Georgia next year. Not only did Walmart build a brick-and-mortar location where residents can conveniently access primary care, dental, counseling, laboratory, imaging, and audiology services in one location, but it also created a digital front door for members.³

Those enrolled in Walmart’s plan will be able to schedule appointments online, easily manage multiple medications through a digital app, and find price lists for any service offered through Walmart, all online. Just as important, the retailer will leverage its massive collection of data on members based on their consumer shopping habits that could assist in determining when and how to engage with certain members to lower healthcare costs and improve health outcomes. One of the retail giant’s goals is to “help members save the most on out-of-pocket spending” through its insurance plans.

Then there’s Amazon, which is exploring unique partnerships with companies such as Health Navigator, which provides digital health content in the form of APIs, and PillPack, a mail-order pharmaceutical company. The tech giant also made its first foray into telehealth with Amazon Care, a virtual care program offered to a subset of employees, and works with National Health Services to make verified healthcare content available to consumers on demand through its AI-powered digital assistant, Alexa.

It’s not hard to envision a future where Amazon rolls out a Medicare Advantage plan, on its own or in partnership with a health tech disruptor or insurer. Amazon could prove to be a formidable competitor, given its potential to draw upon a treasure trove of consumer data to connect members and providers with the right information at the right time to improve health.

Legacy health plans still hold an advantage over new competitors in a few key areas.

First, they have experience in navigating the complexity of the nation’s healthcare system.

Second, traditional players have a head start in understanding how to use patient data to manage care. Nontraditional entrants, such as Walmart, will start to develop an understanding of patients’ medical history as they take on the role of provider. They may also begin to gain access to claims data through partnerships with payers.

Third, a traditional provider setting still feels more intimate to patients than walking into a big-box store. For some baby boomers, this perception may hold them back from committing to a retail provider for their health needs.

However, legacy plans typically are not the first point of contact when members have questions about their health. They also aren’t widely viewed as partners in their members’ well-being.

To succeed in a rapidly evolving healthcare environment, Medicare Advantage plans must create a consumer-driven digital strategy anchored in human-centered design. They must also become skilled in influencing members’ health behaviors through highly personalized digital engagement.

Developing a Winning Strategy

The way in which Medicare Advantage plans choose to engage members digitally will become one of the most critical strategic decisions a plan can make.

Digital engagement is no longer a competitive differentiator. Rather, it’s a table-stakes essential. During COVID-19, when 41% of adults are delaying care to avoid the risk of infection, Medicare Advantage plans that prioritize digital innovation can yield benefits.⁴

Increase/optimize revenue.

Higher levels of digital engagement, paired with interventions that are fueled by analytics, will position plans to increase Medicare Star Ratings, which consumers look to in selecting a plan. These ratings also are used in calculating Medicare bonus payments.

A Guidehouse analysis shows that for Medicare Advantage plans, a one-star rating improvement could, on average, lead to a year-over-year increase in plan enrollment of 8% to 12%. Meanwhile, moving from a 3-star to a 4-star rating could lead to a boost in revenue ranging from 13.4% to 17.6% through increased enrollment revenue and additional bonus payments.

Grow market share—especially among age-in seniors.

Today’s seniors—particularly digital boomers—expect an increasingly digital experience.

Developing a digital front door that is easy for seniors to access and navigate will help plans capture baby boomer business as these seniors age into Medicare. It will also aid plans in developing stronger relationships with existing members by putting the right analytics and tools in the hands of seniors, their providers, and their family members to enhance and protect health.

Transform care delivery through provider enablement and virtual care investment.

The most effective digital platforms help consumers decrease total costs of care by monitoring expensive-to-treat conditions, pairing Medicare Advantage members with specialty support—virtually and on demand—to address health issues at their earliest stages and eliminating barriers to timely access to care. Across the country, health plans are investing in provider enablement solutions that make it easier for providers to offer targeted support and successfully engage members.

Designing virtual care options with seniors in mind also will prove crucial to plans’ success. Studies show that increased access to specialty care via telehealth reduces urgent care visits by 45% while decreasing costs per visit.⁵

The best consumer-driven digital strategies will be anchored in human-centered design.

Health plans need a digital front door that is easy for seniors to navigate and connects them with the resources they need to more effectively manage their health.

¹“American Well’s 2019 Consumer Survey Finds Majority of Consumers Open to Telehealth, Adoption Continues to Grow.” Business.amwell.com, 6 Jan. 2023, business.amwell.com/about-us/news/press-releases/2019/american-wells-2019-consumer-survey-finds-majority-of-consumers-open-to-telehealth-adoption-continues-to-grow. 
²“Bloomberg - Are You a Robot?” https://www.bloomberg.com/news/features/2020-05-06/in-lockdown-seniors-are-becoming-more-tech-savvy.
³“Walmart Partners with Clover Health to Offer Medicare Advantage Plans in Georgia.” Healthcare Finance News, https://www.healthcarefinancenews.com/news/walmart-partners-clover-health-offer-medicare-advantage-plans-georgia.
⁴Czeisler, Mark É., et al. “Delay or Avoidance of Medical Care because of COVID-19–Related Concerns — United States, June 2020.” MMWR. Morbidity and Mortality Weekly Report, vol. 69, no. 36, 11 Sept. 2020, pp. 1250–1257, https://doi.org/10.15585/mmwr.mm6936a4.
⁵“Specialty Telehealth Expands the Value of Medicare Advantage.” Patient Safety & Quality Healthcare, 1 Sept. 2020, https://www.psqh.com/analysis/specialty-telehealth-expands-the-value-of-medicare-advantage/.