Daniel Lebish changed the focus of his healthcare insurance company to meet a need the industry missed. Amanda Barber reports.

Although most healthcare providers worry about the double-digit increase in healthcare costs that have occurred since 2002, Daniel Lebish, president and CEO of HM Insurance Group, sees this trend as a benefit. In the past few years, the company changed its name and repositioned its focus to what Lebish believes is a growing need in the healthcare industry.

“Our product lines focus on supplemental health insurance products,” said Lebish. “We call them health risk solutions products because they focus on identifying and filling gaps in health risk coverage for employers, employees, and other insurance companies and healthcare providers.”

HM Insurance Group recently added a line of HMO reinsurance through the acquisition of Miami-based Risk Based Solutions. But the increased focus on self-insured employers and the introduction of the HM Care Advantage product, focused on uninsured workers, put the company in the position Lebish wanted it to be.

Changing focus
HM Insurance Group underwent many changes in a short period of time. The company changed its name, and, at the same time, dropped two lines of coverage, group life and group disability insurance. Diane Lewis, HM Insurance Group’s director of marketing and product development, said balancing these changes and promoting the company’s new vision was a delicate process.

“We concentrated on our face-to-face efforts to explain our position and tell our story,” said Lewis. “Changing our name and selling those two lines of business back-to-back could have been perceived as a negative. To manage that perception, we maintained an open and conversational position about what was happening.”

Because HM Insurance Group did not have a history of distributing or administering limited benefit medical plans, the company partnered with Indianapolis-based Key Benefit Administrators (KBA). Lebish said working with his sales force, surveying his company’s brokers for market need, and then partnering with KBA made the transition into a different market seamless. “We don’t offer all things to all people. These steps allowed us to move our resources and stay focused.”

Lebish said most limited benefit medical plans are snubbed because they do not cover all healthcare costs. When the company’s market research and product development team found that 90% of employee claims are less than $5,000 to $10,000 a year and that an estimated 26 million employed workers are uninsured, Lebish knew the need outweighed the industry perception.

“These people are working part-time or are working for small organizations that can’t afford to provide them whole first-dollar health coverage,” he said. “Often they don’t need full coverage; they need basic coverage. We saw a gap there as well as a market opportunity.”

Implementing change
Limited benefit medical coverage is the fastest growing segment in the health insurance industry. Although there is no shortage of competition, Lebish and his team worked with KBA to develop online software that gives brokers and employers a wider variety of plan options. The software was rolled out with HM Care Advantage in July.

The Web-based benefit design software module allows each employer to develop a plan based on employee need and ability to pay. Although the software is not geared specifically for employees, it does allow an employer to choose what is covered. “Employers can decide if they want, for example, more of an inpatient or a wellness and preventive care focus,” said Lebish. “As they are building the plan, they can see how the price changes.”

Although other companies have designed software similar to that of HM Insurance Group, those companies tend to be limited to 12 possible plans. HM Care Advantage software has a wide variety of choices and can develop thousands of possible plans, depending on company size and location.

The software also allows employers to offer up to three different choices of healthcare coverage to their employees. Although it is still too soon to full appreciate an increase in business since the development of the limited medical benefit coverage and the implementing software, Lebish said there is definitely a demand.

“Smaller associations and agencies across the country come to us asking for help. We are already the among the largest carriers for stop-loss coverage in the country, but we think we can be a top five carrier and market leader in all of our products,” he said.

HM Insurance Group employs close to 500 and has revenues reaching $600 million. As a medium-sized company, Lebish knows his company’s limitations. “Maybe we can’t compete in IT or capital, but we know we can compete in the quality of our employees,” he said.

Last year, Lebish’s team implemented a cultural philosophy called PACE, which stands for passionate, accountable, collaborative, and ethical employees. The program is a quality-control tool for recruitment, retention, and performance, and each employee, from the president to the receptionist, is expected to adhere to it.

“One underpinning to our strategy is the idea of being an organization that exhibits PACE,” said Lebish. “The second piece is understanding that strategy and execution are equally important. By staying focused and having a core product that fits within the umbrella of filling healthcare risk gaps, our strategy fits our execution, and our execution fits our strategy.”