Direct and to the Point   Nathan Conz

Highmark is the latest health insurance carrier to launch retail stores, aiming to leverage the value of face-to-face customer interactions.

Like Blue Cross Blue Shield (BCBS) of Florida before it, and followed by BCBS of South Carolina shortly afterward, Pittsburgh-based Highmark Blue Cross Blue Shield recently announced plans to open two retail stores in Pennsylvania targeted at customers in the individual, senior and small-business insurance markets.

The retail stores, branded as "Highmark Direct" and slated to open in late March, are the product of an industry that is becoming increasingly consumer-driven, says the insurer's VP of consumerism and retail marketing, Steven Nelson. "With healthcare becoming more consumer-driven, we've been researching, studying and building strategic plans to create better ways to engage the consumer," relates Nelson, who notes that the retail stores represent one of the first such plans to be enacted.

In addition to selling insurance plans to customers in the individual, senior and small-business markets, Highmark will utilize the two retail spaces - one in Mechanicsburg, the other in Ross Township - for informational and educational seminars about its products and programs, according to Nelson. The insurer worked closely with Big Red Rooster, a Columbus, Ohio-based retail design firm, on the development of the Highmark Direct stores, he reports.

Breaking Down Barriers

BCBS of Florida launched a similar retail store in February 2007 and opened a second location in early 2008. In mid-January 2009 BCBS of South Carolina announced that it too would open a retail storefront. In all three cases, carrier executives have identified the value of face-to-face interactions - as customers navigate the often confusing world of health insurance intricacies and acronyms - as a key part of the retail stores' value proposition.

"It's that one-on-one engagement - that's obviously a big opportunity for us," Nelson explains. "[Purchasing insurance] is a very daunting experience: What is the terminology? What products are good for me? How much is it going to cost me, and can I afford it? With the perceptions that health insurance has in the [market], we need to break down a lot of those barriers."

With such value placed on face-to-face interactions, Nelson points out, technology is not a large part of the initial impression consumers receive when they first enter a Highmark Direct store. Carrier employees' first objective, he notes, is to leave all informational materials behind and engage the customers in a dialogue. Many subsequent steps, however, will make heavy use of Highmark's systems, particularly those accessible via the Web, Nelson says.

For example, Highmark currently is developing a new splash page for its customer-facing Web portal that will act as a retail store-specific gateway between customers and the insurer's Web portal. "We really wanted to establish a different type of starting point into our Web site that was more around what the stores' look and feel was," Nelson describes. "It's a [different] face to our Web site, so that when people come into the stores, we can help them navigate our Web site based on the targeted audience - individuals, seniors or small groups."

How purchases are finalized within the retail stores will vary on a case-by-case basis, depending on a variety of factors, such as whether access to state systems or medical underwriting is required, Nelson explains. He estimates that Highmark has mapped out more than 25 transactions that could take place at the retail stores.

According to Nelson, the carrier did consult with colleagues at BCBS of Florida when developing the Highmark Direct stores. He characterizes the Jacksonville, Fla.-based insurer's input as helpful but, because of the difference between the Pennsylvania and Florida markets, Nelson says, it was not groundbreaking. He declines to share the specifics of those conversations.

With the stores set to open in the first quarter of 2009, Highmark expects its knowledge of the retail insurance space to develop over time, and the company will look to evolve the process, Nelson says. "Technology and retail move quickly, and in addressing consumers' needs in the insurance market, I envision us moving very quickly to adjust and change what the transaction process is," he relates. "You don't walk into an insurance store and walk out with a bag of gifts - you don't buy something right off the shelf. So there's a need to truly evolve the retail space that we have with technology."

Copyright © 2009 United Business Media LLC. All rights reserved. Highmark is the latest health insurance carrier to launch retail stores, aiming to leverage the value of face-to-face customer interactions.