Leading Business in the Industry of Providing Health Services Is Humana - Coursework Example

?SID; Module (102KM); (BIS, BIT etc) Sur First Business Information The ability to assist those who need health care has been the main objective of a variety of businesses. One leading business in the industry of providing health services is Humana. This particular corporation has several lines of business, each based on the needs of different lifestyles. These range from senior citizens to self – employed individuals that are in need of specific types of health care. Currently, there are over 6.2 million customers that use this service in 16 states in the United States. This has led to a reputation that is based on the specific types of health care plans and the options available to assist with those who are in need of health care (Humana, 2011). Humana began in the 1960s by providing assistance to those who were living in nursing homes. The beginning in 1961 included two owners, Wendell Cherry and David Jones, deciding to build a nursing home to assist those in need of extra care. Within seven years, the nursing homes had grown to over 40 facilities available for seniors in need of various levels of assistance. By the late 1960s, the need for nursing homes changed, specifically because of the introduction to Medicare and the extra assistance from hospitals. By the 1970s, the focus was to provide extra assistance for living as well as to provide needed resources for those who were in hospitals. This expanded with the acquisition of America Medicorp that was based on adding special care. It wasn’t until 1984 that health plans and insurance were offered to assist a diverse population of individuals. By the 1990s, the company was known for its strong reputation among doctors and patients, as well as the several packages available for diverse needs in health care (Humana, 2011). Today, there are several products and services offered by Humana. The strongest plan is the Medicare option, which began in the 1970s following the ventures in nursing homes. The main health insurance follows this, known as Humana One. This particular brand is known for offering several comprehensive plans for individuals, families, businesses and those who have special needs. This is also divided into alternatives for dental and vision as well as for life and supplemental insurance. Human also offers home delivery for assistance, known as Right Source RX. This is combined with the Humana Pharmacy Solutions, which incorporates the best clinically proven medicines that patients need at all levels. There are also special programs for veterans and military officials, specifically which provides different types of pharmaceuticals and assistance in insurance (Humana, 2011). The growth of Humana in the health care industry has also led to branches in the business for various ventures. A Humana Foundation has been established, specifically which is based on providing health solutions for those that are in need of assistance. The focus is to offer education, training and assistance to build healthy communities. This is a part of the social responsibility that Humana has introduced to various communities. Within this are healthy concepts that are applied, such as the B-Cycle, a community initiative to get more individuals biking to work for better health in the environment and of the individual. This is followed by the Humana Games for Health, used as a way to increase activity in communities while building responses among those that are interested in health. These specific concepts are currently used as the main components of services that Humana is using to give back to the community for building and sustaining health (Humana, 2011). The background of Humana is compliant with the current trends that are associated with the industry sector. Today has several areas that are beginning to grow and offer more to those in health care. New and emerging technologies are providing more health options to individuals in need of assistance. Higher amounts of quality and payment reforms are also being noted. Currently, consumers are interested in lower prices and in avoiding the same amount of care in the past, specifically because of economic changes and the belief in the problems with health care using excess spending outside of the needs that one has. To counteract this, most individuals are trying to find ways to remain healthy outside of the health care industry, while wellness is becoming a main focus of those interested in health care. More important, the changes in lifestyle are leading to changes within the health care system. This has compounded to the new technologies offered as well as infrastructures that are based on new regulations and considerations for those in need of health care (PWC, 2011). The main issues of the industry sector are followed by competitors who are moving into the main trends. Each of the competitors offers similar packages in terms of health insurance care and assistance. The top 10 competitors and the current stock value is seen in chart 1. Chart 1: Top 10 Competitors of Humana Name Stock Value United Health Group 31.3 Wellpoint 21.7 Meco Health Solutions 21.3 Express Scripts 14.8 Fresenius Medical Care 12.1 Aetna 11.1 Quest Diagnostics 9.3 Laboratory Corporation of America Holdings 6.5 Cigna 5.4 DaVita 4.6 Among these top competitors are three that are performing at higher rates than Humana, including Aetna, Cigna, HCSC and Health Net. The recent stock charts can be seen in Graph 1. Graph 1: Competitors of Humana While this chart shows the membership growth, it is congruent with the rise in profit and the amount of demand that consumers are responding to for growth (Donahue, 2009). The products and services that are from the top competitors include similar packages offered by Humana. Aetna offers comprehensive programs for medical, dental, vision and pharmacy plans. There are also extended plans for behavioral health and disability. There is also pet insurance offered and a specialized area that has allowed the company to move into international regions. The company also offers an extensive range of health and wellness plans, including disease management, care management and online health tools (Aetna, 2011). Cigna offers similar programs, including the extensive health coverage and international options. There are also health tools and information areas that are used for those interested in extensive care and interaction with the insurance group. Specialty areas with target markets, such as single mother families and the self – employed are also considered (Cigna, 2011). This is similar to HCSC as well, which incorporates the Blue Care Connection, Lifestyle Management and programs used in conjunction with the health insurance to improve health (HCSC, 2011). Analysis of Humana There are several areas that are stronger in terms of the Humana health care system. Currently, it is the fourth largest provider in the United States and is able to serve all 50 states, best known for the strong Medicare programs and benefits for veterans. This particular application is one that is ahead of the competitors and provides a segmented service to those in need of health insurance. This is direct to consumer advertising that is used effectively within the corporation. The industry is known to move into various regions for sales, specifically with focuses on contacting doctors and physicians for the needed medical insurance and assistance. By creating this relationship with the main consumers, there is the ability to easily connect to those that are interested in the health care. The direct relationships taken to the doctors are then accounted for with patients that are in the industry. As the reforms in health care continue, Humana is able to change effectively with what is needed (Holmer, 2002: pg. 526). Another strength that Humana has is based on catering to the medical consumer. All of the products and services that are provided by Humana are based on the health conscious consumer or those that are in need of assistance. The segmentation that has been built is now developing into helping individuals to have a healthier lifestyle while providing a stronger area of assistance to those who are conscious about their health. The concept of the medical consumer is the main attribute that is kept in mind and which provides the provisioning, specifically which is assisting with changes that are a part of the health care reform currently taking place throughout the United States. As the other corporations and the consumers move toward innovation, Humana is able to meet the needs or move ahead of the other competitors (Applbaum, 2006: pg. 189). While Humana is able to use these specific concepts, it is losing potential because of the lack of expansion taking place. The first area where this is noted is within the marketing mix that is created. The products as well as the promotion of these ideals are the two weaknesses that Humana has in terms of selling products. The competitors noted all have products that are well advertised and available, specifically in terms of providing knowledge about health care and in reaching an international audience. Humana hasn’t expanded into the international audience. Instead, they cater to the 50 states, and are known best in the regions of Florida, Texas and Alabama (Humana, 2011). This is limiting the potential of Humana to move into other regions of the globe that are interested in health care assistance and which are outside of the reform which is taking place in the United States. More important, the activities for bettering health care doesn’t have the correct infrastructure in providing the right types of information and assistance to those interested in receiving the needed assistance with health. When looking at companies such as Aetna, it can be seen that there is a strong development area for assisting with health. This includes management of health, disease prevention and information and training provided to those who want to live a healthier lifestyle. The training and information is the main component with the building of healthy communities as a way to follow this. Humana follows the structure of providing specific activities, such as promoting bicycling to work. This doesn’t create the right type of promotion related to information and understanding the health behind this. The weakness that Humana has is based on understanding the needs of the consumer that would receive health care. More important, there is a lack in noting the behaviors that are associated with individuals and the decision making which follows buying health care and moving into the internal and external factors that influence which health system to incorporate into (Berkowitz, 2011: pg. 126). Unless the product promotion of bettering health is boosted, Humana won’t be able to expand in the same direction as the competitors in terms of offering assistance for better health. The third area where Humana needs to focus on is with the current events and trends that are causing reform. The health care reform in the United States is one of the most well – known issues that is associated with the consumer responses. This is followed by the recession that most expect to continue throughout the United States and lead to other aspects of consumers being hesitant to get the extra services and products available to those in the community. The force of the reform and the economy has led to responses with hospitals and physicians, such as mergers, alignment with value – based bundles and integration of consumer participation in the hospitals. The response of consumers is now based on gaining more knowledge, making secure choices and using technology to maneuver around the unnecessary expenses that are associated with the health care industry (Camden Group, 2010). Changes in consumer behaviors and the external environment are all a threat to Humana and the problems which may arise with the services and products offered. Looking at the reform and the economy are two detrimental factors which can’t be looked at in terms of reform for the group, as it doesn’t have predictions that can be related to growth of the company. However, the hospital changes, such as mergers and value – based bundles, as well as consumer behavior toward gaining more knowledge are two areas where Humana hasn’t expanded upon. Humana can work with the doctor and physician relationships that are merging to move ahead of competitors and to find new, value – based bundles to help doctors. This can be combined with understanding how new technologies are being merged into the businesses, specifically which will provide Humana with different alternatives to merging with the new hospital infrastructures. An area which Humana isn’t tapped into completely is with the consumer demands. The other competitors are doing this more effectively with the comprehensive management plans for health. The value of insurance is continuing to rise, with most consumers looking for knowledge instead of insurance plans to get the assistance needed. This is followed with the technology of the Internet to give insight and assistance related to find answers. Currently, it is noted that the elderly are using most of the health care available in the United States. Preventative measures among others are more popular among those who are health, with 70% of funds for health care going to chronic diseases. It is also known that an average of 23% of those living in the United States know how to take preventative measures to stop chronic diseases (Economy Watch, 2011). Humana is currently not tapping into any of the consumer and external environment trends that are a part of the current consumer mindset. While they are working with the elderly as the primary market and providing insurance for chronic diseases, there isn’t an approach to the consumers who are healthier or who may be facing diseases without knowledge. Humana can tap into different segments of the market that are healthy and interested in other products to help maintain health. Education and training is one area that can be used with the Internet to provide this. This can be expanded by offering more products that are able to boost the lifestyle needs of those in the United States, such as healthy living meals and exercise alternatives. Expanding this area of services can provide Humana with a way to out beat competitors while allowing them to move ahead with the needs for consumers that are facing the reform and who are more cautious of spending. As Humana offers more in terms of products and services for healthier living are more ideals to assist with ways in which the consumers can respond as needed. Recommendations While Humana has created several opportunities in terms of products and services, there are also limitations that are associated with the health market. The competitors against Humana are out beating them in terms of demand, pricing and the ability to keep loyal consumers. This is based on the products first, specifically with offering more options for managing health with preventative methods while considering the international market. This is causing Humana to remain as the fourth largest provider, all which is based on the main establishment of Medicare, chronic disease and helping segmented groups that are in need of specialized health care. For Humana to begin changing and monitoring efforts, there is the need to account for new products and services. The politics and economy in the United States are creating several predictions that are not conducive to Humana. More important, this is leading to consumer changes in demands, specifically in terms of using technology and alternative methods for prevention of disease. Humana can remain competitive by developing new products and services for an international client base and to assist in building healthier lifestyles through information and extra components in terms of prevention of disease. Tapping into this main consumer market can then work as a compliment to the health insurance which is offered and will provide Humana with a different set of individuals who can work with the group for better treatments. The recommendations for Humana moving into the current needs of consumers are one that not only provides compliments in terms of products and services. The changes in health care in terms of medical facilities are also changing. Humana can tap into these while offering partnerships with the facilities to assist clients who are trying to overcome disease or that are working on prevention of specific diseases. Instead of the insurance being the main agenda, Humana can work with cutting the medical costs while moving into educational and training programs to assist those in hospitals. This will work as a compliment to the insurance and will fit with the new technologies and the mergers that are currently taking place. This is specific to the needs of hospitals from the reform and the changes in relations with the consumers. This is also an untapped area by competitors, allowing Humana to gain more customers not only through the insurance, but also by diversifying their programs and products to assist potential customers in a different way. The main focus that Humana can build upon with the competition is to create a sense of cultural competence in terms of health care by becoming more involved with those who are interested in alternative care. This will help to identify the needs of consumers while creating an understanding and response to what the current needs are. More important, it will begin to influence individuals at a wider level to begin changing the way in which health care is looked into. As the cultural competence is formed in terms of disease prevention and basic health initiatives, it will begin to build the confidence with the insurance that is available while stimulating a response from Humana at different levels. The cultural competence will then begin to increase and rise more with the responses to the current trends that are in the external environment (Betancourt, 2005: pg. 499). The needs of Humana are based on moving past the main competitors. Diversifying the products offered, as well as the areas in which promotions occur, can help Humana to move forward with the specific needs and trends. More important, this will provide a different outlook to other trends in terms of politics, economy and the current consumer trends in terms of health care. The need to move into alternative types of products and services with health care will then allow Humana to build more upon what is already offered while building confidence among those that are interested in the basics of health care during this time. References Aetna. (2011). Health and Wellness Programs. Retrieved from: http://www.aetna.com/plans-services-health-insurance/detail/health-wellness-plans/health-and-wellness-programs.html. Applbaum, K. (2006). “Pharmaceutical Marketing and the Invention of the Medical Consumer.” PLOS Medicine 3 (4). Berkowitz, Eric. (2010). Essentials of Health Care Marketing. UK: Jones and Bartlett Learning. Betancourt, Joseph, Alexander Green, Emilio Carrillo, Elyse Park. (2005). “Cultural Competence and Health Care Disparities: Key Perspectives and Trends.” Health Affairs 24 (2). Camden Group. (2010). “The Camden Group Announces Top 10 Healthcare Industry Trends and Challenges for 2010.” The Camden Group. Cigna. (2011). Health for Everyone. Retrieved from: http://www.cigna.com/health_money/single.html. Donahue, Debra. (2009). “Top Plans Experience Enrollment Declines During 1QO9.” Healthcare Business Strategy Retrieved from: http://www.markfarrah.com/healthcarebs.asp?article=65. Economy Watch. (2011). “Health Care Industry Trends.” Retrieved from: http://www.economywatch.com/world-industries/health-care/trends.html. Humana. (2011). Company Profile. Retrieved from: www.humana.com. HCSC. (2011). Company Profile & Initiatives. Retrieved from: http://www.hcsc.com/initiatives/initiatives.html. Holmer, Alan. (2002). “Direct to Consumer Advertising – Strengthening Our Health Care System.” The New England Journal of Medicine (346). PWC. (2011). “Healthcare: Industry Key Issues.” Retrieved from: http://www.pwc.com/gx/en/healthcare/index.jhtml. Read More