Humana 2006 Annual Report Download - page 8

6 Annual Report 2006
Leveraging Medicare success to
enhance Commercial growth. As we have
secured new physician and hospital network
arrangements for our expanding Medicare
business across the country, we’ve become better
positioned to expand our Commercial presence
as well. Off-season deployment of our Medicare
sales force for individual Commercial sales and
the growing recognition of Humana’s brand
through our Medicare expansion make it easier
for us to contract with providers as well as to sell
and renew Commercial members.
Becoming a trusted infomediary.
In the last few years we’ve expanded our
role as a trusted infomediary for a variety
of key audiences.
• For providers, we’ve developed Availity (in
conjunction with Blue Cross Blue Shield of
Florida), a highly successful, standardized
online real-time claims interface. All of
Florida’s hospitals and 93 percent of its
physicians have embraced this technology,
which has enormously expanded provider
connectivity and contributed to Humana’s
national reputation as “easiest to do business
with” among doctors. Availity has also
become a value-added consumer benefi t
by facilitating real-time claims adjudication,
payer-based electronic health records and
HSA administration at physician offi ces. Of
special note is our forthcoming expansion of
Availity to Illinois, Texas, Oklahoma and New
Mexico as a result of a new agreement with
HCSC, the Blue Cross plan in those states.
• For employers, we’ve created a
technologically advanced, hospital and
physician cost-and-quality online transparency
project in conjunction with the Business
Healthcare Group of Southeast Wisconsin,
a Milwaukee-based employer coalition. This
ground-breaking initiative takes transparency
to a new level. And it has performed
remarkably well. According to coalition data,
health costs for the coalition’s ASO members
served by Humana declined by 15 percent in
2006 compared to 2005.
• Among many guidance tools developed for
Commercial members, the most noteworthy
is SmartSummary, a more robust version
of SmartSummary Rx. SmartSummary
cumulatively tracks the health services
members used, what those services cost and
what members could do to save money in
the future for all benefi ts covered by the plan.
Our overall consumer knowledge base, built fi rst,
as we mentioned, from engaging consumers in
our Commercial segment, has been enhanced
by what we’ve learned from managing Medicare
as a consumer business. Such cross-integration
of consumer capabilities is at the heart of our
success. One of the key lessons we have learned
from all our efforts in the past half-decade is
the more we meet consumers on their own
terms, the more they view us as a value-added
“guidance partner,” engendering their loyalty
over many years.
Looking Ahead
With future growth in mind, we’d now like to
turn to what we believe is the most compelling
question for leaders in our industry: What will
it take to achieve long-term success in the
emerging new world of health benefi ts? As
context, we would stipulate that our sector has
largely been immune from challenges that have
profoundly affected the rest of the economy –
globalization, competition from outside the
industry and changing consumer preferences.
But that’s about to change. Long-term
cost factors that result primarily from the
demographics of aging, along with baby
boomers’ relentless desire to better themselves
(and their ability to pay for the privilege), will
rapidly bring health care into the mainstream.
And only those companies already making
progress on the 10 imperatives set forth below
will be able to thrive.
1. Join the rest of the economy. We’ve
had the luxury of living in a world where
the anomalies of the third-party payer
system have shielded us from the realities
In growing from a $14 billion
to a $21 billion enterprise and
adding an additional 4.2 million
medical members during 2006,
we transformed ourselves from a
regional competitor to a national
leader now active in all 50 states,
with a strong, well-respected brand.