Once a luxury, health insurance is now a fundamental need. Rather, in several countries health insurance is a necessity for every citizen. Providing minimum health cover, for sure, is a daunting task for governments; at the same time the growth pace of the health insurance market is rather commendable. Procurement analysts at Technavio believe that the use of mHealth applications is a major driver in the global health insurance market. Procurement leaders are focusing on the upcoming markets in the Middle East and Africa to expand their base, as markets in North America and Europe have already reached a mature stage, it is the region of Middle East and Africa which is the major focus of procurement leaders.
Major procurement challenges in the health insurance sector
So, what can be the possible difficulties for procurement teams in expanding their reach in the unexplored markets? Our market intelligence reports show that, buyers prefer products which have a simple payment model along with an easy claim process. The major hurdle experienced by service providers are:
- Stringent regulatory policies
- High cost of treatment
- Intense competition from regional players
- Slow growth in the mature markets
When analyzed from the global perspective, one realizes that the regulatory landscape is hardly investment friendly for the service providers. The situation becomes even more difficult for global players who operate through their subsidiaries in different regions. Also, when it comes to the treatment of traumatic diseases, most insurers are heavily dependent on the service providers. This in turn hinders the expansion programs of the insurance providers.
Another major area of challenge for the expansion of health insurance market is the stiff competition from regional players. Especially in the APAC and MEA region, the local insurance providers easily integrate the community care with the local associations. This gives them an edge over the international service providers.
Is there any safe solution for procurement managers?
Experts in supplier relationship management believe the changes in reimbursement structures and administrative costs, is sure to provide the much-needed boost to the health insurance market. Procurement managers are diligently working towards strategies wherein the administrative costs can be cut down and premium charges can be revised. Transparency is yet another area, which is the focus of procurement specialists.
In a bid to give utmost priority to the buyers, it can be said that the insurance providers are not leaving any stone unturned to reach out to the masses. Health insurance providers are trying their best to build a bonding which goes beyond reimbursement of the medical expenses. And, it is this strategy which perhaps will do the magic for category managers in the health insurance sector.
Good health and availability of the right medical help is something every government in working towards. The best solution perhaps lies in providing congenial environment for service providers to expand their base. At the same time placing right number of tabs needs to be placed so that the health insurance products are easily available to everyone.
To get an in-depth analysis on the procurement process involved in the health insurance industry
