Health New England: Peter F. Straley, President/CEO

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It’s no secret that insurance companies are not loved by everyone. In some cases, this is understandable.

But as Peter F. Straley, president and chief executive officer of Health New England, will tell you, not all insurance companies deserve this rap. There are many out there who want to see their communities get the best health services around, and as a result, these companies make the customer, not the bottom line, their highest priority.

“At HNE, our promise to our customers is to help them to get the most out of their healthcare benefits,” Stralely said. “If there is a problem, no matter what it is, we will help them solve it. It is with this filter in mind that we approach each call.”

If the president came here…

As the healthcare-reform debate raged in 2009, the 280 employees of Health New England, located in Springfield, Mass., were upset. They agreed that the country’s healthcare system needed reform. They felt that the debate brought worthy issues to the forefront. What upset them the most, however, was the way in which insurance companies were being characterized.

As Straley tells it, his employees were insulted that politicians, including President Obama, were inferring that organizations like their own were part of “the big, bad insurance companies.”

Many HNE  associates came to Straley and begged him to write to Mr. Obama, asking him to refrain from making these insinuations.

“We take it very personally that we’re trying to help folks,” Straley said. “I think that if President Obama came here and saw how our organization operates and sat in and listened in on the phone calls, in his next speech, he would say that he has met one insurance company who is doing it right.”

In serving 120,000 members in western Massachusetts, the $400-million per year Health New England is rated as one of the top plans in the country for customer service. And Straley hastens to clarify that this is not an accident. It is a corporate strategy.

“It reflects the people who work here,” he said. “They have a customer-oriented attitude.”

Growth amidst challenges

Perhaps this focus on the customer is why Health New England is expanding at an unprecedented rate.

“We are growing at a time when the economy is challenged,” Straley said. “We’re growing for a number of reasons.”

One of these reasons involves two new product lines that HNE has rolled out over the past few years—the Medicare Advantage Product Line and the Medicaid Managed Care  Product Line.

Medicare Advantage is a product that is offered on a voluntary basis to people who are eligible for traditional Medicare, yet prefer the advantages of a more “managed-care” style approach.  Nationally, roughly a quarter of Medicare beneficiaries choose such a product.

Similarly, the Medicaid Managed Care product is a voluntary offering for those individuals who qualify for state-supported Medicaid coverage, but want a more “managed-care” style approach.  In Massachusetts, the majority of Medicaid beneficiaries are enrolled in a managed-care product.

These lines represent a change in focus for the company. Over the last 25 years, HNE has concentrated on reaching out to the commercial market, but thanks to Medicare Advantage and Medicaid Managed Care, HNE can now include the government end of healthcare in their service lines.

The second reason for HNE’s growth is the healthcare reform that took place in Massachusetts.

“Massachusetts is the epicenter of healthcare reform, and this past year, the administration decided to essentially institute for the first time a rate review of all managed-care plans, and effectively what that did is it more or less froze the market for small employers,” Straley said.

In the early fall, when the rates were unfrozen, companies discovered that people were now more educated and sensitive to rate differences, thanks to the high level of media coverage and political conversation the review had received.

Health New England has historically been a competitively-priced market offering. Although they do not always have the lowest rates in the market, their plan is established, well-known, and perceived to be of high value. Following the review, customers flocked to HNE, causing the company to see its commercial membership grow substantially over the last year.

Then, there are the internal positives. Three years ago, HNE started to lay the groundwork for what has become the Opportunities for Improvement Program, a company-wide initiative that sought to engage all HNE associates in improving their workplace and work processes. This process is based upon pioneering work done by Dr. Alan Robinson from the University of Massachusetts and published in his book “Ideas Are Free.”

“This has been really profound in that departments that have really embraced this are improving their operations, their ability in reporting favorably on their metrics, their customer service, and everything they do on a continuous basis,” Straley said.

Striving to be different

HNE employees pride themselves in putting forth their best effort to help members get “the benefit of their benefit.”

“High-quality health insurance is the single-most important benefit that employees get after their salary. In some cases, people work for benefits more than salary,” Straley said. “It is very expensive. It is very important. We take the attitude that you and your employer, depending on the product, have made a big investment in this, and you ought to actually get the benefit from it.”

When customers call HNE, they are often surprised to discover that a real person is answering the phone. An even bigger surprise is discovering that this person is actually sitting in Springfield, and as Straley emphasized, most of the time, that person grew up in the Springfield area, so they have an idea of local healthcare needs. Eighty percent of the time, customer issues are resolved over the phone during that first call.

“That person’s job is to help you resolve the issue,” Straley said. “Our job is to get from no to yes and to get there with a smile. And you can tell that the people who work here like their jobs. Not only does that come across on the phone, but it is also evident based on the retention of associates in our call center.”

The reform debate

Straley believes that the healthcare-reform debate is primarily a debate about affordability and cost. While he understands the political expediency of blaming insurance companies, he believes that ascribing full blame to them is a mistake.

“We are actually the industry that can drive this change, and we believe our type of plan, which is a provider-sponsored health plan, is uniquely positioned to do this, because this is a challenge that will only be met if three things occur,” he said.

First, there needs to be near-universal high-quality health-insurance coverage. Straley emphatically stated that this insurance has to be high-quality.

“It’s not just some flimsy excuse for insurance,” he said, adding that he believes they have developed such a system in Massachusetts.

Second, Straley said the delivery system has to be redesigned and reengineered. HNE is “embroiled in that right now.” Straley said HNE has a unique role to play since they are on both sides of the equation, being an insurer and being sponsored by a provider.

Finally, the customers have to take responsibility and be accountable for their own health.

“We are not going to bend the cost curve as a nation until we as a nation adopt healthier behaviors and healthier habits,” Straley said. “We all know this intellectually, some people practice it, but most can do better, including myself.”

Straley knows this personally as Hampden County, where HNE is located, has the lowest health status of any county in Massachusetts. Neverthless, as an insurance provider, Straley said the issue always comes back to his doorstep.

“We own that. We are ground zero for the cost debate, and we are 100-percent committed to moderating cost trends, maybe even to reversing them a bit.”

-by Pete Fernbaugh

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{ 1 comment… read it below or add one }

Pam Cline November 18, 2011 at 9:56 am

Great article – I give it a 10. So often people do blame the insurance companies for everything, though they don’t exercise, eat well, or schedule their preventative visits to their PCP. For over 20 years, I have Health New England as my plan, and my calls have been answered 100% of the time by a person @ HNE with no wait time.


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