Health insurers go online

Buying everything from compact discs to groceries, American consumers have made the Internet a virtual shopping center.

Now there's new merchandise at the mall: health insurance.

Insurers have been slower to offer group products than individual policies online. But several local insurers offer group policies, and one company plans to allow businesses to get rate quotes for group plans in 2001.

Among the local insurers with online products are Highmark Inc., headquartered in Pittsburgh and East Pennsboro Township, Capital Blue Cross and HealthAmerica, both in Susquehanna Township.

The personal nature of health care means that buying health insurance online presents both opportunities and challenges to consumers and businesses who shop online.

"(Buying insurance online) is very convenient, but the consumer should be careful," said Mick Meckler, Capital Blue Cross vice president of information technology. "Privacy and security are issues of great concern."

Capital Blue Cross offers rate quotes for individual insurance products, such as Medigap policies, on its web site, www.capbluecross.com, and hopes to add rate quotes for small group products next year, Meckler said. Capital Blue Cross began offering the online quotes in June, and the site has received about 4,000 hits to date.

To get a rate quote for an individual family on the Capital Blue Cross site, consumers choose one of five product options, enter their family size and Zip code and submit their request. They receive a quote almost immediately. They can then download enrollment forms, which they mail to the company.

Selling group insurance products online is not as common in the industry as individual products, Meckler added.

"Group products are much more complicated, and it's harder to put them into an online format," he said.

However, at Coventry Health Care Inc. in Bethesda, Md., insurance brokers can use the Internet to check rates and enroll individuals in small group plans that have between two and 50 people, according to Harry Fox, the company's vice president for e-business. Coventry is the parent company of HealthAmerica.

Highmark offers a group product sold exclusively online to employers. Employees then use the insurance company's web site, www.highmark.com, to create an insurance policy tailored to their specific needs, said Kim Bellard, Highmark's vice president of indemnity and special products.

"The Internet allows us to give consumers a variety of choices," Bellard said. "We see it as a real tool to become closer to our customers."

Selling products online might be the most obvious way that insurance companies are tapping into the Internet market, but it is only the tip of the iceberg, Fox said. Companies also are using the Internet to allow subscribers to manage their policies, give physicians an easier way to communicate with health plans and provide health care-related information.

For example, Highmark's new NaviNet service allows providers to use the Internet to check the status of claims, review referrals and request authorizations.

The Internet also has improved insurance companies' ability to answer subscribers' inquiries, said Bob Grim, Capital Blue Cross vice president of customer service.

"Customers can use e-mail to contact us at any time of day or night," he said. "We're trying to make dealing with us as simple as possible."

And this strategy appears to be working. While Capital Blue Cross received 208 online inquires in August 1999, the company received 561 inquires this August, Grim added.

Yet, providing personal health information via the Internet is something that many consumers are wary of, said Geoffrey Dunaway, director of the bureau of accident and health for the Pennsylvania Insurance Department.

Before deciding to buy a policy online, a consumer should use another Internet resource: www.insurance.state.pa.us, the department's own web site. There, a consumer can research an insurance company, learn whether the company is licensed to do business in the state, what products it offers and whether there have been any complaints against the company.

A little bit of research can go a long way. If a consumer purchases insurance online from a company that isn't licensed to do business in Pennsylvania, the Insurance Department may be powerless if a problem arises, Dunaway explained. HealthAmerica recognizes consumers' fears and makes sure that all information transmitted online is encrypted, Fox said.

"It's like a Fort Knox over the Internet," he said.

At Capital Blue Cross, one employee's job is to try to break into the company's site and plug any security gaps before they compromise subscribers' privacy, Meckler said.

Although Internet privacy is a hot topic, the paper-based world isn't perfect either, Dunaway said.

"When you think about it, privacy and security is just as tenuous in the paper-based world as it is in the online world," he said.