The health insurance of the future

The German Federal Statistical Office in Berlin published its 15th coordinated population projection in December 2022. It predicts that the number of people at retirement age will increase by around four million to 20 million people in 2035, followed by a sharp rise in people aged 80 or over in the following decades until the 2050s and 2060s. The number of employed people is projected to fall by 4.8 million over the next 15 years – these two trends combined will pose enormous challenges for health and long-term care insurance.  ‘Something has to change urgently if quality care is to remain affordable’, remarked Florian Reuther, director of the Association of German Private Healthcare Insurers (PKV). ‘More and more people are in need of care, yet fewer and fewer young people are contributing. That is why we have to take action now. Even now, private health and long-term care insurers are forming capital-backed reserves to relieve the younger ones. Politicians must make it possible for more people to take such precautions. This way, we can and must lighten the burden on future generations.’

Private health insurers are more affected by the rising numbers of long-term care cases than statutory health insurance funds. The Association of German Private Healthcare Insurers notes that the mandatory private care insurance community is ageing faster because policyholders from the ‘baby boomer’ generation make up a significantly larger percentage in mandatory private care insurance. It is essential for health insurers to utilise an effective solution with regard to the complex business transactions in mandatory private care insurance – msg.Cura is a complete solution in the form of standard software.

Enacted in May 2021, the German Digital Modernisation of Healthcare and Nursing Act (DVPMG) opens the door to innovative strategies. It paves the way for new digital applications in care, which are designed to help people in need of care stabilise the condition of their health. The act also allows for more ways to expand remote medicine.

However, the crisis has also brought about solutions, such as doctor’s notes via phone; a special solution that is set to remain in place until March 2023. Also known as remote medicine, digital GP appointments became extremely popular. The Patient Data Protection Act (PDSG) of April 2020, i.e., provides the basis for further digital innovations as it governs the structure of electronic patient records and e-prescriptions.

The crisis has reinforced a trend which insurers have been experiencing for a long time already. It has long been impossible for insurers to assert themselves in the health market playing the role of a claim settler – end customers require a complete package, an all-round service provider. Customers expect services such as electronic patient records, which were rolled out in stages in statutory insurance starting in January 2021, yet remain on the starting line when it comes to private health insurance. In August 2022, Allianz Private Krankenversicherung became the first provider of private health insurance to be given the green light to offer electronic patient records by Gematik, Germany’s national agency for digital medicine.

Private health insurers are interested in supplementary insurance policies for people with statutory insurance (e.g. supplementary dental insurance) coupled with the model of occupational health insurance, which could prove to become a new trend. It opens a channel to all employees of a company, making it possible to offer attractive rates which, in turn, from the perspective of the company, improve employee retention and can even be linked up with occupational health management. The particularities, such as collective agreements and mass collection, have to be fully implemented in the technical systems of the health insurers or in employer portals.  Our solution msg.Health Factory covers all of these requirements. It also factors the particularities of financial aid into aid processing and the administration of people eligible for financial aid, members, and employers, as well as federal and state-specific financial aid legislation.

Although the pandemic laid bare weaknesses in the digitalisation of the health sector, it also raised awareness of the solutions to the problems and kick-started legislative projects. It remains challenging for private health insurers to implement all of this, especially in competition with new companies which can operate without the burden of historical policies and align their products and services with what customers today expect in terms of service. Visions of platforms and ecosystems developing on them are increasingly becoming reality. They lessen the technical burden, which offers no additional benefit when it comes to standing out from the competition or creating value, for insurers and state-level financial aid. Centralised policy management and the delivery of all necessary processes can greatly reduce costs for an individual insurer again. This leaves insurers free to distinguish themselves in the market with products and services that offer policyholders tangible added value: better pension products, making it easier to book an appointment at a clinic, simple prescription management, streamlined claims management and a fully developed health record that makes a real difference for all parties involved.

For insurance companies, it is crucial to accomplish seamless end-to-end integration of the brave new world into policy and claim management systems, from input management to the core systems to the point of service, where cutting-edge products and services are made available to the policyholder. The technical backend is vital in terms of quickly and efficiently processing transactions which, thanks to clever process automation (also known as shadow processing), help leave room for complex cases to be handled individually and minimise the process costs during the company’s evolution into a service-oriented provider.