The 5 main economic advantages for Health Insurance Companies afforded by mHealth apps

“Currently HICs have rather unfocused and small app portfolio’s which do not in most cases seem to be backed up by a goal driven mHealth app strategy.”

These are just some of the findings from our  Health Insurance App Benchmarking Report 2015

mHealth apps promise to deliver 5 economic advantages for health insurance companies including reduced reimbursement payouts, retaining customers, acquiring new customers, generating new revenue streams and saving costs through efficiency gains:

  1. Reduce reimbursement payouts – There is no broader proof that mHealth apps help HICs to reduce payouts, but there are numerous studies, admittedly of diverse quality, that claim that mHealth apps do improve patient outcome, reduce number of doctor’s visits, length of hospital stays and generally improve people’s health. It should not take long before HICs recognize how these potential benefits could have an impact on reducing health care costs and reduced payouts.
  2. Retain members — Most apps fail to retain their users on a broader scale. On average 9%[1] of initial downloaders are using mHealth apps on a monthly basis. Apps will have to become better in ‘locking-in’ their users before they have an impact on member retention. On the other hand, apps that provide real value for the members of a HIC will help to make the member stay. This could be supported by well understood retention tools like loyalty programs and network effects to increase the switching costs of a member (e.g. “points” gained with healthy behavior redeemable via an app, number of installed and used apps and sensors that connects to the HIC services, number of peer patients that a user connects to on an experience sharing platform provided by a HIC).
  3. Acquire new members — Since the beginning of the app ecosystem apps are used to sell devices (e.g. smartphones, scales, wearables) as well as services (e.g. remote monitoring of heart patients, remote diagnosis of skin anomalies, and remote analysis of eye test results). There are also HICs which have launched their health plan offerings around mHealth apps and activity trackers (e.g. Oscar) to enter the market and to push their member acquisition. These initiatives support the hypothesis that HICs can attract new members with a state of the art mobile application offer.
  4. Generate new revenue sources — The mHealth app market will offer significant revenue potentials in the future. In 2017 the market will have grown to a size of $26bn[2]. Today HICs are not competing in that market although they know so much about healthcare, their members and have established member touch points that would allow to create and promote very targeted new services or leverage their member base for third party offers e.g. wearables, remote consultation services.
  5. Save costs through efficiency gains — Mobilizing company’s processes by e.g. providing mobile access to company data or supporting sales representatives with navigation services is proven to increase workforce efficiency. Allowing members to easily integrate into the companies workflows with the help of a mobile app by e.g. making a picture of an invoice and sending it to the claim office or by providing mobile access to personal insurance plans on the go to will have a positive impact on the overall efficiency of a health insurance company.   Out of all major economic benefits areas, HICs have focused most on these benefits as a starting point.

5 Main Promises HICs

However HICs app portfolio’s are currently unfocused and are backed up by a goal driven mHealth app strategies. Currently, providing easy access to membership information and facilitating information exchange between members and HICs is the most common area HICs provide app services for. Furthermore, reference apps, the second biggest category within the app portfolio of HICs only loosely supports one or the other promised advantage of mHealth apps.

HICs can also expect to receive brand value from mHealth app publishing. This has been and will continue to be the reason for publishing the one or the other app. Some companies have managed to gain a lot of initial awareness for their apps, but most of the time their apps did not create enough value for their users because they did not meeting best practice standards. Thus the initial awareness converted neither into users nor increased brand value.

The most prominent example for apps failing to provide enough user value after an initial hype is Carepass by Aetna. The app aggregates data from fitness, nutrition and mood apps into one dashboard, to allow the user to have one view on his health and fitness status. After announcing the mobile version of Carepass app in 2013 at the Mobile World Congress followed by a significant number of mentions in the online and offline media, the app did not attract enough users that regularly looked into the service. The app did not meet the usability standards the user had from their other apps. At the end of 2014, Aetna shut down the service and received bad mentions in the media.

These are just some of the findings from our report, for a more detailed analysis of some of the world’s top health insurance companies and their mHealth app publishing activities check out our new  2015 Health Insurance App Benchmarking report.

Comments are as always welcome.



[1] Average of 30+ company sample

[2] research2guidance 2013


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