Could tiered pricing models equip you better to address your Healthcare Needs?

Healthcare is more about working around your funding options for immediate and later medical needs unlike risk cover such as life. Many innovative ways of financing your health related expenses has been evolving over the years. We have doctors offering primary care services for a monthly fee under the subscription/direct-pay model. We also have equated monthly options in certain countries to finance your high cost medical treatments while many offer this service at zero interest rate taking cue from credit card EMI options. We have community based health model where members of that particular community pay for each other’s health care expenses by allocating certain amount on a monthly basis. While physicians, medical devices and communities have been trying to fund directly their patients for medical costs, Insurers are also jumping into the fray with their own subscription model where you can pick and choose health plans that is most suited for your healthcare needs and financial condition. In the future, this move could be envisaged to herald a situation just like your telecom/media and entertainment companies that offer tiered pricing plans based on your usage. Auto insurance has opened their doors for such a usage based insurance cover. Many industries which are consumer oriented likely to move towards such a scenario. Many of our medical costs are reactive and choosing right plan/option is a big conundrum to solve.

Now, we may classify our healthcare needs under existing three level models such as primary care needs, secondary care and tertiary care. Primary care can be offered by your next door physician for your basic healthcare needs such as mild fever or for regular consultations and counselling. Secondary care will be offered by your specialists such as neurologist or orthopedician for your very specific requirements. While brain surgery or heart surgery or to deal with chronic conditions we may consult tertiary care specialists.  We may also include the long term care for chronic conditions under the tertiary care as they need special arrangements and care plans prescribed by specialists.

As many physicians are teaming up to offer subscription/concierge services with any time consultation and personal touch, it may sound better to have some basic medical services covered under this scheme. It is also reported that the cost of the subscription services is also steadily climbing down to make it more affordable. Some sources from public domain indicate that cost of these basic services is also cheaper compared to similar services covered under insurance scheme. It may be prudent to choose your nearby physician who may offer specialized medical consultation and also direct you to right specialist for further health complications.  He may also closely monitor you for preventive services. Payers are also mulling over offering subscription based plans for your different healthcare needs. While Affordable Care Act in US has mandated insurance companies that participate in exchanges to offer different schemes with varying ranges of deductibles, co-payments and co-insurance that may seem akin to subscription plans. But the primary difference is all those plans cover your preventive and primary care services as part of the plan and increasingly cover different health risks. With insurers likely to offer plans at individual levels, it may be reasonable to choose plans that cover your moderate and chronic health conditions that may surface in your future life by paying premiums that cover only for that specific risk.

With digital revolution happening all around, it will impact providers, payers, pharma companies and medical devices to alter their business models to suit to emerging consumer trends. Consumers today are more used to devices, free sharing of information, increased knowledge on spending and increased choice of products. Payers for instance, may offer plans that suit an individual and his family health needs that are differentially and dynamically priced with usage of big data and analytical technologies at the background. Providers may use technology to keep track of their limited patients group, monitor their health conditions using remote monitoring technologies, send reminders over mobiles, video consult over tablet/TV, provide chat support and fix up appointments online. Analytics can also be used to understand the health pattern of this group, develop personalized care plans and negotiate better terms with the prescription players for this group. Strong consumer demands will shape the way they want their health products to be structured and funded by them that will force healthcare players to innovate their business models. If government could support with tax credits such as Health Savings Account in US (HSA whose relevance needs to be seen post Obama Care) for paying for their medical bills from their savings, consumers may further be empowered to choose plans of their choice. Healthcare expenses should be an individual choice and should not be state burden while states should provide policy and infrastructure support.