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I need a case study regarding how Oscar Healthcare has developed its pay for value business model by focusing on creating value for its customers and customer experience.
Hello and thank you for using Wonder for your question about Oscar Healthcare.
In short, Oscar Health offers to make health insurance more streamlined through a host of tech-savvy features, easy access to medical assistance, and an emphasis on a positive customer experience.
Please find a summary of our methodology and our results below.
METHODOLOGY
During our research, we looked through academic journals, websites of consulting firms, and trusted media sites to locate a comprehensive case study for Oscar Healthcare's business model.
After a lengthy search, we concluded that no single case study exists for this particular topic. However, we found multiple reputable sources that we can use to compile a brief report on the company.
We will use these sources to summarize Oscar Healthcare's business model and try to highlight points that detail the company's focus on customer experience.
OVERVIEW
During our analysis we identified three major points that we believe summarize the business model of Oscar Health:
— Well-designed, user-friendly platforms with a streamlined customer experience
— Simple and well-communicated service plans
— The Concierge system
It seems that whenever the company comes up in articles, one of these three points is mentioned as being key to their market differentiation.
One article emphasizes their technological prowess, while another one notes that they are, essentially, "a consumer experience company."
We will expand on these key points below.
CREATING VALUE
Cleverism.com has a good summary of Oscar Health, including a short background and snippets of data like market share, investments, business model, etc. It also includes a "Value Proposition" section, which will be our first highlight.
"Oscar Health’s provides value to its customers through its simplified insurance products, the convenience and accessibility of its services, its use of technology, and its flexibility."
"Oscar Health’s key selling point is that it claims to simplify the notoriously complex process of buying health insurance, purporting to offer a no-surprise experience to its customers with easily understood insurance plans."
Oscar Health's website has a long article by the founders themselves that reiterates many of the mission goals found in our other sources:
"We decided to start a healthcare company that would change [the state of American healthcare], using technology and personalized service to build an end-to-end healthcare experience that is designed to be seamless and simple, and one that optimizes for affordability and quality of care. Oscar provides a healthcare experience centered around what consumers want and need — or, as we put it in our earliest days: the kind of healthcare we would want for ourselves."
TECHNOLOGY
According to The Digital Insurer, "Oscar is using technology to simplify the entire health insurance experience in a way that legacy health insurers have been unable to do."
"For example, customers can use Oscar’s app to consult with a doctor at any time and get prescriptions without ever leaving home."
"Another example is the use of Geofencing and geo-locational data to enable Oscar members to choose from a list of available and relevant doctors based on their location."
"They can also keep track of their health history with a timeline and earn financial discounts for staying active with a free Misfit step tracker."
The company also recently launched a tool that utilizes machine learning to provide in-depth patient analytics for physicians.
COSTUMER EXPERIENCE
Besides leveraging technology, an important feature of their service is the easy access to qualified healthcare assistance through their app or website, and the company's 'Concierge' system.
A Concierge team consists of 3 assistants and a nurse who will attend to the customer's needs, be it insurance information, paperwork, appointments, etc. This team is assigned to the patient as long as they remain with the firm.
"Health care can get complicated. That’s why you get a dedicated Concierge team to help you stay on top of your family's health. You’ll talk to the same people every time you call or message."
Finally, the company provides a simple plan structure and various services free of charge. A 4sightHealth article puts it like this:
"Oscar pays for all primary care visits, routine lab tests, and generic drugs. No co-pays. No denials. 24/7 connectivity. User-friendly apps. Rewards for healthy lifestyle choices. What’s not to like? Oscar has attracted 135,000 members in New York State."
An article on FastCompany notes that many of the services on offer might also be available with other firms, Oscar is just better at communicating what it has to offer.
"Many health experts agree that where Oscar excels isn’t in its plan benefit design, but in the way that it markets these offerings to its members. [...] They also do a much better job at marketing ancillary benefits like gym discounts, while other carriers with similar benefits have failed so hard at this."
RESULTS
When discussing the future of the company after the 2016 election, co-founders Mario Schlosser and Josh Kushner highlight a few accomplishments that they attribute to their consumer-oriented business approach:
"Over the past three years, more than 100,000 have purchased our product, without having to grapple with entrenched employer-insurer relationships that have made the health insurance market so stagnant and unresponsive to market demands."
"Our Concierge Teams — a fundamental reimagining of the role a health insurer should play in guiding its members through the healthcare system — have improved upon our already stellar customer service by providing each member with a dedicated team of experts, empowered by comprehensive care management tools and powerful predictive care algorithms."
"We were the first insurer to make tele-visits free for everyone, and our members use them at five times the rate of people insured through their employers."
"Our algorithms identify a physician’s true specialization with four times the precision of the typical insurance company’s doctor finder."
"As a result, our net promoter score is three times the industry average and the most common answer people give when asked why they joined us is because their friends told them about Oscar."
While this is a very subjective assessment by the company, other sources seem to corroborate that, at the very least, they offer something interesting, and they have seen relative growth despite major issues — like the future of Obamacare and the healthcare market in general.
It is also worth mentioning that the company received another round of funding last year, when "Fidelity led a $400 million investment in the tech-savvy insurance start-up. The deal values Oscar at $2.7 billion, according to sources in the know. That’s up roughly $1 billion from September 2015 when Oscar took in $32.5 million from Google Capital at a $1.7 billion valuation."
CONCLUSIONS
To sum it up, Oscar Health's value proposition is to make health insurance more streamlined through a host of tech-savvy features, easy access to medical assistance, and an emphasis on a positive customer experience.
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