health insurance
And We're Off 🚀
A deep dive into how Winston Health was conceptualized and the lived experiences that influenced its creation.
Free health plan perks are costing you money. Let's explore how to solve this disturbing trend. 😱
A couple of days ago, I received an email from Sana Benefits and that made me realize there's one tactic used by health plans that isn't talked about enough...free stuff.
While the offer of free health benefits does a decent job of influencing a healthy lifestyle there are still two problems here. Can you name them?
1. Premium Discrimination: Sana members get 25 "free" credits to use per month on ClassPass.
Free fitness classes and massages sound great, but they certainly aren't free. A quick search on ClassPass's website shows the approximate value of 25 credits to be ~ $50/mo.
Sana almost certainly isn't paying full price for their member's 25 credits per month. A 50% discount for the volume of Sana's members would be normal, meaning that we can confidently say that the average Sana member's premium is $25/mo. ($300/year) more than what it would be if Sana didn't offer this "free" benefit. What if a member doesn't take advantage of this perk? People are implicitly paying for a benefit that they may or may not be using...not cool!
2. No Guarantee that Benefit is Used for Health: Sana's email subject explicitly mentions "messages" as included with this "free" benefit. I'll be the first to say that massages feel great, but massage therapy as healthcare is far from settled science. With such unsettled science behind the health benefit of messages, why is Sana promoting and using member premiums to pay for them? Further, in the body of Sana's email notes, "Credits can also be redeemed for free massages, haircuts, and more." A bit of searching on ClassPass's website will show you that credits can also be used for "Manicures, blowouts, lashes, etc." Again, why is a health insurance company raising its members' premiums for non-health-related services?
How could Sana improve their communications, their value proposition, and save their members money?
1) Don't raise everyone's premium for a perk not everyone will use: I don't use ClassPass, but I'm sure it's great. Instead of making forcing people to use ClassPass to recoup the money they've already indirectly spent, reward ClassPass and other fitness service subscribers with money off their premium for the classes they've taken. This gives individuals the freedom to choose services and brands that best align with them while promoting and rewarding healthy behaviors.
2) Only offer rewards for behaviors that offer health benefits: Manicures, blowouts, and lashes all have their place, but it isn't as a perk offered by a health plan. Health plans should strive to enhance their member's whole health and lower costs for members and employers. Activities that fall outside of this core mission shouldn't be highlighted, let alone be offered as a free perk.
This is all a good reminder that what's good for users is often good for business - Help people be their healthiest selves, don't charge them for things they don't want, and give them the flexibility needed for them to achieve their goals.
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