This month we speak to Moray MacLennan of Ping An Health. Moray has a strong background in incentive driven wellness and the convergence of MedTech with digital insurance. Based in Shanghai since 2014, Moray has worked with Discovery and Ping An Health as a senior consultant. Recently Moray facilitated the transfer of expertise from the Discovery Group companies in South Africa, UK and USA to Ping An Health in China and is currently studying at Oxford Said business school.
- In the face of increasing competition in the Chinese insurance industry, how does Ping An plan to compete with i) Baidu, Alibaba, and Tencent (BAT) and ii) Western insurers who will be more able to compete as regulations around M&A continue to relax?
Ping An, and by extension Discovery’s strength comes from its core risk management competencies.
Internet incumbents have great distribution channels but they don’t have deep risk management expertise. For example, health insurance in China is immature and the BAT could struggle to establish sustainable insurance companies that can manage risk well over the long term, especially in the life and health segment.
Additionally, Ping An Group has both online and offline distribution. For example, 1.2m agents drive Ping An’s life insurance business and cross sell many other Ping An products, including specialist health insurance. This offline capability, in addition to dedicated apps that support agents will continue to differentiate Ping An from both the BAT and Western entrants.
- Which will have a bigger impact on the insurance industry, blockchain or AI?.
Blockchain is quite smart and can be utilised to give lots of people access to authenticated data points. The timestamp, the immutable record, the lack of human interference can link disparate health data whilst ultimate control remains in the patient’s hands through the distributed ledger as opposed to one insurer or hospital, which has obvious benefits in a patient centred healthcare model.
The challenge for blockchain within health insurance stems from increasing consumer hesitancy to share private health data. For an insurer, being given access to an electronic health document detailing a potential client’s entire healthcare history, would be beneficial, but its difficult for an insurer to get access to that data.
One exmaple of innovation in this space is ‘medrec’, an MIT spin out venture that looks promising, but it’s still early days.
AI has enormous potential for predictive analytics but currently the data collected from sensors, IoT and online is very messy, difficult to pool and parse.
Clearly, AI driven analytics applied to radiology reports and x-rays is yielding higher accuracy than radiographers. When one considers applying natural language processing to doctor patient consultations and other data sources, the potential for AI healthcare could be groundbreaking.
- What are the key trends in digital health insurance?
3.1) Chronic disease management apps
When considering any new technological trend, it’s important to remember that technology alone is not enough. Digital health insurers need to account for behavioural economics, psychological insights and human-centred design in order to achieve mass adoption and consistent engagement. Additionally the need to include other touch points and healthcare professionals is required. Pure diagnostic and assessment alone is not enough.
For example, for diabetics, a 1% point drop in a diabetes patients’ monthly A1C blood test can significantly reduce diabetes related complications or risk of seizure. There are already several apps that help diabetics to administer accurate insulin doses and even administer insulin extra-venously, that is clearly use case and a key trend.
3.2) DNA profiling
It’s early days for DNA profiling. Specifically, a DNA profile matched against some sort of pattern recognition is still relatively untested. Collecting and parsing raw genetic data in order to formulate a reliable health outlook and identify potential health risks is still unreliable. However, the marriage of DNA profiling and advanced analytics is showing promise in targeted drug therapies and is another important trend.
From a physical activity perspective, wearables have a clear proposition and especially for health insurers who are trying to incentivise physical fitness and engagement with products.
However, there is a ‘so what’ element to wearables. I’m waiting for the next iteration of these devices. Could your Apple Watch notice anomalies and tell you you’re exhibiting symptoms of X or Y? Then it becomes more interesting.
– Wearables are at 1.0.
– The more that these devices take the onus off the person to do something, and turn it into background activity, the more successful they’ll be. Then you’re starting behavioural change, which is the ultimate goal.
- The notion of an ecosystem seems especially relevant in China (Ping An Good Doctor or China Life retirement homes). Why do you think we don’t see the ‘ecosystem’ phenomenon in the West?
In the West, the healthcare environment is mature and developed, entrenched parties in each segment of the value chain (hospitals, insurers, distribution) make it hard for any one company to take an ecosystem approach. However, in China, private heath care is still a blank canvass. This provides an opportunity for those that are aggressive enough to establish a presence across the value chain.
Additionally, the platform approach is the norm in China – Tencent, Alibaba, Baidu all built their brands with an underlying platform. So it makes sense that this approach will also be taken in the health sector too, a platform of health centered offerings where consumers can connect with a relevant service providers as they need to. Ideally, this will also enable online to offline activities.
Ultimately, if an insurer can own the patient journey end to end including interfacing between public and private systems, you can achieve greater efficiency, better risk management, quality monitoring, and much more. This all encompassing approach actually makes more sense for patients, providers, insurers and society as a whole.