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Shaping the Digital Future

Winning with Mobile Health Apps How health insurers can gain a competitive advantage by

embracing mobile as a driver for innovation

May 2015

FLASH INSIGHT

2

Copyright

This document is intended for personal use only.

Distribution is only permitted without any changes or omissions – publication, in

whole or in parts, requires prior written consent by MÜCKE, STURM & COMPANY

and correct citation of sources.

All mentioned company names, logos, brands, brand symbols and other copyrighted

material are the sole properties of the respective company; they are only used for

illustrative purposes.

3

Health insurers can use mobile apps to gain a competitive advantage. The definition of a digital strategy and transformation of the organization are key success factors.

Source: Mücke, Sturm & Company

Key Take-Aways

2 Mobile apps can lead to a competitive advantage In the private health insurance market only few insurers use innovative features to differentiate themselves

on the market. Yet many innovative features can unlock promising benefits for health insurers.

A comprehensive mobile app offer can lead to a competitive advantage through improved brand awareness,

higher customer engagement, increased customer satisfaction and loyalty, and decreased costs for health

and administration.

1 Health insurers are lacking innovative features The analysis of the top 10 private health insurers in selected countries shows that in every country health

insurers offer mobile apps, yet oftentimes lack innovative features. Provider search, contact details, and

claim submission are the most popular features. Innovative features like medical appointments or digital

bonus programs have very low penetration rates.

3 Digitalization needs strategy and organizational changes Aetna is a best practice example for a an insurance company that has embraced digitalization. Its fast-failure

approach to releasing mobile apps and the willingness to invest in and acquire digital knowledge not only

point to an underlying digital strategy, but also demonstrate that it has built up the necessary internal

business and IT capabilities.

4

MS&C has analyzed the mobile app offerings of the top 10 private health insurers in 6 countries covering all geographical, innovational and economic aspects. Scope

1 The countries are selected on the basis of the criteria geographic location, innovational strength and national economic situation.

Source: Mücke, Sturm & Company, company websites

5

The average penetration of mobile apps among the top 10 private health insurers is 75% with the United States leading the benchmarked countries. Mobile App Penetration

Australia United Kingdom

Offer an app Do not offer an app

Singapore United States Germany

India

100% 80% 90%

70% 60% 50%


6

Number of

mobile apps

Penetration

among insurers

Ø Number of

Features

60% 3

13% 5

13% 7

7% 7

4% 8

3% 14

60% of health insurers use mobile apps as just another channel, offering only a limited number of features. However, Aetna clearly stands out with many features. App/Feature Matrix

N=45


Nu

mb

er

of

ap

ps

7

Number of features

4

1 1 7 14

Beginner

Developer

Builder

Researcher

7

Basic and operational features are most commonly offered. However, innovative features are lacking in many health insurers’ feature portfolios.

67%

53%

38%

36%

29%

24%

24%

22%

22%

20%

18%

18%

18%

16%

13%

11%

9%

9%

9%

Provider search

Contact details

Claim submission

General health information

Contract administration

Healthcare manual

Patient ID

Overview coverage & expenditure

Vitality tracking

Fitness tracking

Discounts

Medication services

Personal health information

Conclusion of contract

Premium calculation

Personal medical record

Emergency help abroad

Bonus program

Medical appointments

1

2

3

1 General health information on illnesses, treatments, symptoms and the human body. 2 Manual which helps to manage all issues that impact the personal health and well-being. 3 Individualized health information based for instance on blood pressure, fitness condition, or weight measurement.

Most Common Features

Basic features

Operational business support

Innovative features


8

90%

60%

10%

50%

10%

40%

60%

80%

30%

30%

0%

60%

50%

10%

10%

40%

0%

20%

30%

83%

33%

50%

83%

17%

50%

17%

0%

67%

50%

33%

0%

0%

17%

0%

17%

17%

33%

17%

22%

56%

56%

22%

11%

11%

0%

0%

0%

0%

33%

11%

22%

0%

11%

0%

33%

0%

0%

63%

38%

13%

25%

25%

0%

25%

25%

0%

13%

25%

13%

13%

13%

38%

0%

0%

0%

0%

80%

80%

0%

0%

80%

0%

40%

0%

40%

40%

20%

0%

0%

40%

20%

0%

0%

0%

0%

App features differ highly between countries, with the U.S. and U.K. offering the highest number of features and Australia lacking many features. Benchmarking by Country

Germany United States Australia United Kingdom India Singapore

71%

57%

100%

29%

57%

43%

0%

0%

14%

0%

0%

0%

0%

29%

0%

0%

0%

0%

0%

11 17 8 15 9 13 ∑

Claim submission

General health information

Contract administration

Healthcare manual

Patient ID

Overview coverage and expenditure

Provider search

Vitality tracking

Fitness tracking

Discounts

Contact details

Conclusion of contract

Personal health information

Medication services

Premium calculation

Personal medical record

Emergency help abroad

Digital bonus program

Medical appointments

Basic features Operational Business Support Innovative features


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Aetna (USA) stands out as best practice examples for mobile health apps. BUPA offers the best mobile health app in 3 countries. Best Practice Examples by Country

Feature score Based on number of features

Innovation score Innovativeness of the features

User Interface Graphic and design of the apps

Total Score

Max. 4 points per category

Aetna 92%

BUPA 75%

BUPA 50%

Cholamandalam MS 50%

AXA 50%

BUPA 50%


10

Aetna has achieved its leading position by offering a broad mobile app portfolio that consists of two main apps and several other apps for selected use cases. Overview Aetna Mobile Apps

1 PMR = personal medical record

Stars stand for iTunes App Store rating

Source: Mücke, Sturm & Company, Aetna Homepage

Aetna Mobile

2010

PMR1

Patient ID

Contract admin.

Overview

expenses &

coverage

Provider search

Contact details

iTriage

2009

Personal health

information

Medical

appointments

Healthcare

manual

Provider search

General health

care info

Aetna Intl

Provider 2012

Provider search

Contact details

Resources for

Living 2014

Healthcare

manual

General health

care information

Contact details

Aetna

International 2013

Claim

submission

Contract admin.

Provider search

Contact details

Aetna Get

Active! 2014

Fitness tracking

Vitality tracking

Aetna Plan

Selection 2015

Premium

calculation

Overview expenses

& coverage

11

Digital Organization & Roadmap

"We were focused on the next generation

of clinical program that deal with chronic

and other diseases in our first year, and

now we're on the second area around

tech innovation.”

July 2013

Mobile Applications (App Store Rating2)

Aetna’s success with mobile health apps is based on both setting up several digital initiatives and reflecting digitalization in its organizational structure. Overview Aetna

1 PBM = Pharmacy Benefits Management 2 Based on Apple App Store, April 2015

Source: Mücke, Sturm & Company, Aetna Homepage

Aetna Inc.

Founded: 1853 in Hartford, Connecticut, USA

Employees: 48.000

Countries: Worldwide in more than 100 nations

Operating income: $ 4 billion

Revenue: $ 58 billion

Customers: 24 million medical,

15 million dental,

15 million PBM1

Digital Initiatives

Funding of different initiatives in order to leverage

technology and mobile innovations

Since 2009, Aetna launched a variety of mobile applications

and acquired different mobile platforms like the popular

mobile health app iTriage

Fast-failing approach: In 2014 Aetna shut down some of its

mobile projects (e.g. fitness tracking aggregation app

CarePass) in order to move on to more promising

innovative projects

Resources for Living

Aetna International

Aetna International Provider

iTriage

Aetna Mobile

Aetna Get Active!

Aetna Plan Selection

2014

2013

2012

2009

2010

2014

2015

4.5

3.5

3.5

3.5

2.5

1.5 Michael Palmer Chief Innovation Officer

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Overall, mobile health apps can generate a variety of benefits for health insurers, which can lead to a competitive advantage. Benefits of Mobile Health Apps

Customer Engagement

The establishment of a direct customer

relationship leads to

Improved communication through

personalization and a direct communication

channel

Valuable customer insights through

analysis of customer activities (e.g. through

bonus programs, digital fitness tracking,

frequency of app usage)

Benefits

for Health

Insurances Customer Satisfaction

Mobile health apps are increasingly expected

by customers, therefore health insurers need to

follow customer usage

Innovative and customer friendly apps improve

branding and brand awareness which in

return influence membership growth positively

Mobile apps open up new target groups

(young people with high affinity to

smartphones)

Branding

Customer satisfaction is increased:

- Information easily accessible

- Processes less complex

- Transparency increased

Customer loyalty is intensified:

- Digital fitness tracking programs

- Lock-in-effect as more personal data is

stored within the app (e.g. disease

management for chronically ill people)

Cost Reduction

Costs can be reduced in two ways

Reduction of health costs as members‘ awareness

for a healthy lifestyle is increased e.g. through

- Digital fitness tracking programs

- Information on healthy living

- Disease management programs

Reduction of administrative costs through the

reduction of paper (e.g. mobile claim submission)

and call center staff (e.g. self service tools)

00110

10100

10010

€


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Contact details

Munich headquarter

Theresienhoehe 12

80339 Munich

T +49 89 461399 0

F +49 89 461399 777

Darmstadt

Mina-Rees-Strasse 5a

64295 Darmstadt

T +49 6151 800 400 0

F +49 6151 800 400 777

Cologne

Kaiser-Wilhelm-Ring 26

50672 Cologne

T +49 221 995878 0

F +49 221 995878 777 Darmstadt

Cologne

Munich

www.twitter.muecke-sturm.de www.slideshare.muecke-sturm.de

www.muecke-sturm.de www.xing.muecke-sturm.de

Germany

Michael Mücke Managing Partner

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