Axa Health CEO Heather Smith says the insurer can “see inflation coming down significantly” and has outlined the plan for progressing its new digital platform.
Smith is also pleased the insurer made its “little bit of a reset” when increasing doctors’ fees by 15% and reveals it is exploring more remote or in-home care for patients.
And she remains happy with the Doctor Care Anywhere service after it was downgraded by the Care Quality Commission, saying the issues raised have been “satisfactorily resolved”.
Smith joined as CEO of Axa Health in January from Allianz Insurance where she was managing director of retail.
She tells Health & Protection the first few months have been spent listening and understanding the business, including listening to calls and talking with advisers and hospitals to “immerse back into it”.
“That embedding part was really important upfront, and I kind of enjoyed reconnecting,” she says.
Smith has significant history in the sector having previously led Norwich Union’s (now Aviva) private medical insurance (PMI) and income protection (IP) business as head of sales and marketing.
And her experience in digital transformation throughout her career is also likely to prove essential given the journey she describes Axa Health is on.
Like the rest of the sector, this year has been a busy one for Smith and Axa Health.
As the Health & Protection Individual PMI Report showed, the retail market grew by around 11.5% in 2023 with the corporate membership rising by around 5%, and this continued into 2024.
Smith noted that Axa Health has seen growth in its existing corporates, in the SME sector, particularly at the smallest groups, and with individuals.
Claims inflation ‘coming down significantly’
However, one of the consequences of this membership growth, largely driven by the strain on the NHS, is the rapid surge in claims across the market in terms of cost and frequency, which has pushed premiums higher, significantly so in some cases.
Axa Health is not immune to this.
“Absolutely, we’ve had frequency inflation for sure,” Smith says, before acknowledging that price can only play one role in controlling the heightened activity and that the current approach is neither desirable or sustainable.
“We are an insurance company and at the end of the day pricing risk appropriately and delivering a sensible and fair margin is important,” she says.
“So of course prices have gone up across the board and very much for corporates and brokers; that’s quite evidence-based, there’s nothing being hidden.
“Therefore, everything else we do in our business is important in terms of how we manage efficiency and effectiveness and control costs and deliver a good, sustainable business.
“We don’t want to and you cannot put those sorts of price increases through all the time and have people withstand them, that’s not possible.”
However, there may be light at the end of the tunnel for the sector, as Smith adds, “Thankfully we can see inflation is coming down significantly year-on-year.
“And then there is everything else we’re doing to make ourselves efficient and well run.”
She notes that the purchase of rehabilitation specialist HBSUK was part of this agenda looking at sustainability and growth for the business.
“We did it in terms of speed, access and good quality outcomes, moving more of the health to digital solutions where they make sense and where they can deliver,” she says.
“That muscle, bones and joints pathway we’ve had live now for some months is really delivering high customer service and fast turnaround.”
Digital transformation
Another key development for the business is moving it on to a new technology platform.
The first significant move for this was the launch of the individual Health Plan product last year with new business for that product being placed onto the platform.
The digital development will eventually result in all members and products being served through it and should enable other functionality as well.
“The next year we’ll be doing all of our new business at scale on the platform, including the migration of our existing individual customers and then we’ll look to SME and large corporate in due course,” Smith continues.
She emphasises that replatforming a business, conducting a full scale move from one to place is “not an easy exercise”.
However, she hints at some of the changes that could be introduced as a result to help clear the customer and business wish list that has built up, led by “a lot more self-service”.
This is likely to feature the ability for patients to select and book consultants directly themselves as one of the key developments.
“Our front line staff know what customers want and we have ongoing customer feedback and our proposition development,” Smith explains.
“We’ve got the product owner set up and it’s about now executing on that, for example, the ability to click the link and get the names of the consultants, choose the one you want and book it without touching anything.
“That’s a good example of the types of things people want. They want to go on to member online services, see all the benefits, they want to see the status of their claim, and such.
“It’s these services we are continuing to build out in a sensible way, and it’s going to take us a bit of time to get there, but the funding is there, the program is set up, we’ve got the platform and we’re already on with it, so it’s exciting.”
‘Reset’ doctor relations with 15% fees rise
One of the other main driving features within the market has been relations between medical professionals and insurers, which have been increasingly tense over the last two years with practitioners becoming increasingly outspoken and adversarial in their demands for better pay.
As one of the major players in UK health insurance, Axa Health’s relationships with the medical profession is a critical one and watched with interest by the market.
Earlier this year head of specialist and practitioner strategy Sarah Taylor, spoke about how the insurer had on average increased fees for medical practitioners by around 15% this year.
Smith agrees the medical profession are a “really important part” of the insurer’s work and that “a little bit of a reset” was needed.
“It’s back to the sustainability we talked about; we need to have a sustainable service,” she says.
“We need to have fair contracts and fair fees with people, which is essentially what Sarah referred to, it was time for a little bit of a reset and I’m glad we got that sorted.”
More remote care
The insurer is also looking to expand the use of technology and remote services to care for patients where it can help outcomes and reduce costs.
Remote GP services are an obvious example that have taken off alongside the soaring demand for primary care, but there are other services and treatment approaches being pursued.
“A lot more cancer services are now delivered at home because many chemotherapy treatments are oral, so a nurse can do that for you at home,” Smith explains.
“Again, that’s something we’re focused on with our consultants and hospital partners to bring in more of those services where it makes sense.
“And it’s right for customers because with them staying at home they feel much more comfortable, we see that in the feedback.
“With MRIs and diagnostics too, all the big scanners and all the big kit used to be in hospitals, but now you’ve got specialist centres and that’s completely changing the access and cost,” she adds.
Prevention, wellbeing and engagement
Following that trend of greater primary care need, Axa Health is also looking to put more emphasis and investment on preventative care and wellbeing, working alongside its international arm Axa Global Healthcare.
“Thematically at the global level, we see prevention, wellbeing and all of that as an important strategic pillar,” Smith continues.
“So not only what we are doing here in the UK, but how we work together globally is something else we’re considering.
“We are regularly talking to our clients, I’ve been out and about meeting some of our large corporate clients and our big brokers, and they’re very much hearing that the wellbeing element is helpful because it’s engagement for people.
“It gets them in contact with their cover and their benefits, as well as what it does for them mentally and from a wellbeing perspective.
“But we have to be careful that those benefits are not just there for the sake of it, that there’s a purpose to them, and they play a role in the whole delivery of health.”
Tackling service levels
One of the trickiest problems of the vast and rapidly rising demand in private medical insurance uptake and claims post-pandemic has been maintaining service levels.
The sharp growth in membership and usage hit providers across the market with many reports from intermediaries of long waiting times for them and their customers to get information about claims and other issues.
Smith acknowledges the difficulties across the industry and says Axa Health sought to tackle it with a combination of people and technology.
“You can’t just put people at the problem because customers want digital solutions as well, but for different parts,” she says.
“We did have to recruit more frontline staff and at the same time look at all the technology solutions we could pull in as well.
“People are important in the health business, but members also very much want the convenience of digital services for different parts of the journey; people where it matters and technology where it can support.
“That’s very much been the approach we’ve taken and are continuing to take, we’re by no means done and there’s lots of enhancements we want to bring to those digital services as part of this new platform,” she adds.
Something disconcerting specifically for Axa Health was the downgrading of its remote GP services provider Doctor Care Anywhere by the Care Quality Commission (CQC).
The move came last October before Smith joined, but with the CQC not having returned to re-review the medical provider, the downgrade continues to linger.
Smith however is content with the situation now, with the corrections made and is not contemplating a change of service provider.
“That has all been satisfactorily resolved and to the right level, and they remain our partner,” she says, adding, “fortunately that’s behind us”.
Finally, Smith sums-up her future for the insurer, which have a significant slant on technology development.
“A big part of my job will be maintaining all that is good, which there is much, and then taking us on a number of those transformational changes to ensure we are a modern business fit for the future.
“That’s really where I’ll be focusing a lot of my time and energy,” she concludes.
