In the health insurance industry, due to the introduction of the Affordable Care Act (ACA), the age of consumer-driven health plan selection is upon us. Developing an understanding of exactly who your members are, what motivates them to remain with your health plan, and how to maintain and grow your medical book of business is critical.  With more choice than ever before, and with individual members personally paying a larger percentage of their own healthcare costs, competition for members among health plans has never been so intense.  You can't simply rely on the long-held notion that says "The more products we sell a customer, the more likely they are to remain our customer."  Instead, you must understand and control the underlying factors.

The more you know about your members, the better you'll be able to serve them, which in turn means you are more likely to earn their loyalty. Persistency modeling provides the pathway to this knowledge.

Ben Hunt-Davis is a former British competitive rower and Olympic champion. After years of disappointing results, his team (Team GB) decided to change its focus and approach things differently. They decided to focus on one simple goal, against which they would measure all future decisions. That goal was in the form of a simple question: "Will it make the boat go faster?"  They faced decisions about a wide range of things such as boat design, training, diet, racing apparel, shoes, or rowing technique. If the answer was "yes," then whatever the team was considering would be accepted and pursued. If the answer was "no," it would be scrapped as non-essential. The result of this new approach was that Team GB won the gold medal for men's 8+ team rowing at the 2000 Sydney Olympics.

A key advantage of persistency modeling, in addition to what it can contribute to business results, is the speed at which it can be deployed. Unlike other strategic initiatives and analytical efforts that can take months or even years to complete, a thorough and actionable persistency modeling analysis can be finished in a matter of weeks.  A properly designed program will:

Health plans today are facing enormous challenges. In the post-ACA business environment, health insurers are under increased pressure to provide superior products and customer service while at the same time managing their operating costs and maintaining profitability. Fortunately, as the health insurance industry has changed, new strategic approaches to understanding, retaining, and building membership and profitability have evolved along with it.  Persistency modeling is an important tool for rapidly unlocking competitive advantage and creating market differentiation in today's dynamic health insurance market.