Future of Healthcare #3 - The Tiered Healthcare system
Financial pressure on healthcare systems is nothing new. However, the current combination of recession, inflation, ever increasing costs of testing and treatment and the health burden of aging populations are making publicly funded healthcare systems very difficult to maintain. The upshot of this is that the care that people might need and expect is simply not available in the time frames that they need it in. As a result, people who would normally rely on public healthcare are now put in a position where they are looking to the private sector to cover a specific need in a specific moment.
This introduces new people from different demographics and socio-economic backgrounds into the market for private healthcare solutions and this in turn creates an interesting new challenge and opportunity for the private sector. Where in the past a more polarised (have v have not) insurance-based system was fit for purpose, there is now a need for more thought and innovation in the sector to create affordable packages and options for people from different backgrounds who don’t have the budget or need for full sized insurance products.
This opportunity has led to some interesting innovation that has made the system more accessible, affordable and flexible. In the UK Vitality is a great example where people are empowered to adopt (and verify) healthier lifestyles to reduce premiums. In the USA, Cityblock has developed an offer aimed at people from more disadvantaged and underserved communities that aims to reduce cost of cover by addressing some of the social determinants of acute and longer-term health problems. Alongside this, providers in the UK like Benenden Healthcare are directly addressing the situation that people find themselves in at a practical level, by offering a low-cost entry level option that complements (and tops up) what is available in the strained public sector.
It’s a complex and changing world and one where well-informed innovation will be key to developing an integrated healthcare system that chimes the needs, budgets and attitudes of a wider cross section of customers than ever before.