Health Insurers Tweak Websites, Open Retail Locations For Consumers

Nan Cohen saw the e-mail on June 26: Her daughter Elyssa Wenkert's health insurance coverage under her father's policy was set to expire in four days.

Elyssa turned 18 earlier in the month.

"You don't think of things like what do you do when you don't have insurance coverage until it's upfront and personal," said Cohen of O'Hara.

She called Highmark Inc.'s insurance store in Ross and spoke with customer service rep Lee Conrad. She knew Conrad from a year ago, when she and her husband purchased individual health insurance policies at the Highmark Direct store, which recently had opened.

"I knew we would get coverage for Elyssa, but I was worried about the timing. Could we get the coverage in force before July 1," Cohen said last week. "We came in on Wednesday (June 30). Lee sat down with us and we got a policy."

Cohen is one of more than 25,000 people who have visited Highmark Direct stores since they opened 15 months ago in Ross and in Harrisburg.

"We took a calculated risk in placing stores," said Matt Fidler, Highmark's consumerism and retail marketing director. The state's largest health insurance company wasn't sure there would be enough customer demand to make the stores worth the effort, he said.

But trends in health care insurance dictated the move. Decisions were increasingly were being pushed onto individuals a situation that became even more pronounced during the recession, when millions nationwide who lost their jobs lost employer-provided health care coverage.

Selling health insurance in a retail setting where customers can examine their choices, like they shop for clothes or groceries gets the Highmark brand directly in front of consumers, experts said.

More insurance carriers are beefing up websites, opening retail locations, and even making their written communications more user-friendly. They are preparing to compete for millions of new customers starting in 2014 because of health care reform. Health insurers will be banned from refusing coverage to people with pre-existing conditions or charging them exorbitant rates and for the first time, individuals will be required to have health insurance or face a financial penalty.

Under the new health care reform law signed by President Obama in March, by 2019 about 24 million Americans will obtain health insurance by buying private coverage in regulated marketplaces called exchanges, according to estimates from the Congressional Budget Office.

"Storefronts were bubbling up before health care reform, but with reform, between now and 2014, insurers are trying to grab as much brand loyalty as possible," said Kathleen Stoll, health policy director at Families USA, in Washington.

Stoll said when the health care changes come, insurers believe customers will sign with companies they know rather than those they don't know. But all insurers aren't opening stores.

"We have not opened any retail locations, and I am not aware of any plans to do so," said Walt Cherniak Jr., spokesman for health insurer Aetna Inc.

With 25,000 visitors at two stores in 15 months, Highmark considers them a success, Fidler said. Consumers visit the locations to get insurance questions answered and, in many cases, to purchase individual and small-business health insurance policies. The company won't disclose how many policies have been sold in its stores.

By late September, Highmark will open three new locations in Western Pennsylvania and another Harrisburg-area store. The new Highmark Direct stores will be at 4008 William Penn Highway, Monroeville; in the Lafayette Plaza Shopping Center at 218 Summit Park Drive, North Fayette; and in Norman Center II, 1775 N. Highland Road, Upper St. Clair.

"Person-to-person assistance really works," said Nan Cohen. "On the phone, can you spend six hours asking questions and being placed on hold?"

Highmark's Fidler said store staff "can take 30 to 60 minutes per person to explain the intricacies of health insurance. We're really only limited by the customer."

The Highmark Direct stores have a self-service information areas with computers customers can use, equipment to collect simple health measurements, plus classrooms and meeting rooms where people can ask questions and work with staff on coverage or billing problems. The stores are open Monday through Saturday from 10 a.m. to 7 p.m. and are staffed by Highmark employees who don't work on commission.

"I needed six months of health insurance coverage before I was eligible for Medicare," said Sally Bosserman, of Franklin Park. "Someone told me about the store, so I went down and found the people very helpful. It was just so nice to be able to talk to a face, instead of push this and push that using a telephone."

Consumers Union Senior Health Policy Analyst Steven Findlay said there are pluses and minuses with health insurers selling insurance from storefronts.

"On the downside, bricks-and-mortar locations don't allow consumers to comparison shop, because they generally are selling just one company's products," Findlay said.

"On the upside, Americans continue to have great difficulty in understanding the intricacies of health insurance, and these stores allow customers to come in, sit down and speak with a real person."

Highmark wasn't the first Blue Cross member company to open a health insurance store.

Blue Cross and Blue Shield Florida Inc. in Jacksonville opened its first retail location in 2007 and in January, opened its fourth store. BlueCross BlueShield of South Carolina opened its only retail outlet in January 2009.

"We've had a few thousand customers since the store opened in January 2009, and we consider it to be a success," said Elizabeth Hammond, spokeswoman for BlueCross BlueShield of South Carolina in Columbia.

"About 10 percent are people with existing policies who have questions and are assisted by our people. The rest are primarily individuals looking for individual insurance, and they are served by independent insurance agents who work out of our store."

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