Fighting through his first winter in the Big Apple, Cigna Corp.’s new market president Scott Evelyn wonders a little why he took a job in New York doing the same thing he did in warm, sunny Florida.
But of course he came north last summer for the same reason many people do: Opportunity. With the health insurance industry undergoing unprecedented upheaval as the Affordable Care Act is implemented, smaller insurers such as Cigna see a chance to expand market share.
As a company that’s historically focused on large employers who aren’t (directly) affected by most of the law, Cigna (NYSE: CI) is less exposed to the uncertainty. The company’s hoping it’s a good time to convince major New York corporations to give Cigna, a niche player compared to insurance giants Empire BlueCross BlueShield and UnitedHealthCare, a second look.
Cigna appointed Evelyn to his position in September, after four years in the same role for Florida and the Caribbean markets. I spoke with my fellow New York newcomer on Thursday. Here’s a few of the high points:
How is New York different from your past markets?“It’s a larger market, with a lot of large employers, and a lot of rich benefits here. That’s the one thing I’ve really seen in my four or five months in the marketplace. The benefits and plan designs are much more rich, and there are more people covered under the plans. So we have a higher cost of living, but that’s one benefit most consumers really don’t understand. The benefits here cost less.”
Is the goal, then, for Cigna to convince clients that you can still manage costs without doing something more dramatic, like sending employees to an exchange?“Most of our employers today, they’re not looking at the exchange platform as an alternative yet. When you look at the employers that are really reviewing the exchanges, it’s the smaller size, it’s five, 10 or 15 (employees), under 100 for sure. But (big companies) are looking at the exchanges, the concept. How do I offer benefits differently to employees today? Would it give me more flexibly in terms of multiple offerings? Should I push that responsibility to my workers, instead of giving you a health plan, give you the choice to choose a health plan? …For Cigna, that’s not as concerning based on the population we serve today, but it is, in the future, it’s going to be more real.
Insurance is becoming a consumer product, even though it’s been traditionally sold to a company, which then makes the product available. What’s that transition mean for Cigna?“It’s interesting. Today, we’re actually selling to employers with an individual in mind. We know that space is going to shift over time. It’s on us to ask, how do we get to a technology platform that’s more centered on the individual than you traditionally find in health care, because tomorrow, that’s how it’s going to be sold. That’s been our ramp up. Tomorrow may be five years away. But tomorrow, I don’t think, is 20 years away.”
Cigna is now evaluating whether to begin selling individual insurance policies in New York and New Jersey.
Date: Feb 10, 2014