Aging Baby Boomers Are Pushing Health Plans to Design New Products, Retool Existing Ones

by Lesley Politi on October 23, 2008

Aging Baby Boomers Are Pushing Health Plans to Design New Products, Retool Existing Ones

By Mike Carbine, Managing Editor, (

A rapidly aging population, with its accompanying explosion in chronic conditions, has health plans moving quickly to create new products and tweak many of their existing ones to meet the special financial and health needs of baby boomers and retirees.

The market is already large and will double in size in the coming years. Every seven seconds a boomer, and there are 76 million of them, turns 60. By 2030, almost one of every five Americans — some 72 million people — will be age 65 or older.

But a financial challenge for consumers is an opportunity for any insurer that can develop products that appeal to the pre-Medicare and retiree markets, as well as employers that are dealing with an aging work force. In this article, HPW profiles the strategies being pursued by Aetna Inc. and Blue Cross Blue Shield of Nebraska to tap into both the pre-Medicare (age 50 to 64) and the retiree (65+) markets.

While health plans might take different approaches to these markets, one thing Aetna and the Nebraska Blues agree on is the need to build proactive health and wellness initiatives into almost every product aimed at the 50+ market. And like many plans, both are rethinking their traditional approaches to disease management to position these programs ahead of the chronic disease curve.

Baby boomers might have been more physically active and, in some cases, more health-wise than previous generations. But many are in poorer health than their earlier counterparts. They have high rates of diabetes, hypertension, obesity and other chronic conditions. And the situation will intensify as they age. By 2030, industry observers predict, six of every 10 boomers will be managing more than one chronic condition, a situation that will lead to higher disability rates.

Employers have taken note, says Dennis Wheeler, vice president of product strategy and consumer products for Blue Cross Blue Shield of Nebraska. “The nation’s work force is graying along with the general population, and employers are very interested in keeping [those] employees healthy, productive and on the job.”

Plans Tap Into Pre-Medicare Market

Of particular interest to insurers is the “pre-Medicare” market (i.e., people between the ages of 50 and 64). This cohort, insurers say, is ripe for products that either supplement their existing coverage or provide “bridge” coverage if they leave the work force before becoming Medicare eligible. Medical Mutual of Ohio says its individual market products that feature health savings accounts (HSAs) are especially popular with this group because they want to protect their assets against the cost of a catastrophic illness, although the company’s non-HSA-eligible high-deductible products also are popular.

Aetna is tapping into this market with a suite of products offered through a co-branding arrangement with AARP. Frank McCauley, head of Aetna’s consumer business segment, tells HPW that the AARP Essential Premium Health Insurance package, launched this past January, is designed to meet the needs of the 50+ age group at every life stage. Targeting AARP members (and their families) between the ages of 50 and 64, the product line includes three comprehensive PPO plans for those looking for a more traditional coverage package; two high-deductible plans with HSAs; and two plans focusing on preventive services and hospitalization indemnity.

McCauley says that each product has a different price point and level of benefits tailored to the specific needs of older consumers. And a strong prevention and wellness component is built into each product. “Older consumers know that staying healthy will have an impact on both their quality of life and their financial health.”

PHRs Are Available to Medicare Members

Aetna also targets the 65+ population with Medicare supplemental, Medicare Advantage (MA) and standalone Medicare Part D products. McCauley says that, in keeping with the new focus on prevention, its MA product features several health promotion tools, including a health risk assessment (HRA). “Everyone who enrolls gets an HRA so we can involve them in either a preventive wellness or a disease management program.”

Aetna also is pushing Web-based personal health records (PHRs) among its boomer members. “The 65+ cohort is the fastest-growing segment of Web-site users,” McCauley says. “And they’re consistently accessing information on medical conditions.” Once they do this, Aetna begins pushing back information specific to their health interests, including targeted prevention and wellness strategies. The PHRs were made available to Aetna’s Medicare members this past August.

The Nebraska Blues plan heavily promotes the Blue Distinction Centers for Specialty Care program among its “pre-Medicare” members to help them access the best care possible for several aging-related medical conditions. Blue Distinction is a designation awarded by Blue Cross and Blue Shield companies to medical facilities that demonstrate expertise in delivering high-quality, cost-effective cardiac care, transplants, treatments for complex and rare conditions, and bariatric surgery. Members are encouraged to access these facilities in their local areas or, when no local facility is designated, in other locations. “It’s both an educational tool and a way for members to easily access the care they need for aging-related conditions,” Wheeler says.

Plans Cut Chronic Conditions Off at the Pass

The insurer also is placing a new emphasis on prevention. “Every time we design or deliver a new product, we build pieces into those products that speak to the 50+ group,” says Wheeler. “The result is that more of our products now have preventive benefits, typically with first-dollar coverage.”

For the Nebraska Blues plan, this entails refocusing its disease management efforts around chronic disease early intervention. “We want to be ahead of the game and not wait until someone becomes ill,” Wheeler says. “It’s first-dollar prevention because it focuses on the earliest possible intervention and works to help people manage their health at the earliest stage possible.”

Another strategy: boosting adherence by making it easier for older adults to access services and, especially, medications that will help keep chronic conditions under control. “We know from the data that older adults are more apt to get and take necessary medications when barriers are removed or reduced,” Wheeler says. So many of the insurer’s products now feature zero copayments for generic drugs.


Questions call Politi Insurnace Agents & Brokers


Leave a Comment

    Previous post:

    Next post: