On Tuesday September 12th, Apple unveiled their latest line of products. One of their products, the Apple Watch, made waves across mainstream media due to newly added cellular capabilities. This means phone calls can be made and received through the watch. Can you say ‘Beam me up, Scotty”? At this point, you may be wondering what does this have to do with the health insurance industry?

The post conference media coverage largely focused on the watch’s new cellular feature. However, there’s another set of features of the Apple Watch that didn’t garner as much press; Apple’s heart rate monitoring capabilities. According to a study from the University of California, San Francisco, the Apple Watch can detect an abnormal heart beat with 97% accuracy. Starting to see the connection? But, to understand it fully we’ll take a look back at 2016.

AETNA AND APPLE – WHAT’S THE STORY?

In 2016 Apple won the support of the insurance giant, Aetna; largely due to the potential of Apple’s heart rate monitoring feature.   For the first time in history, an insurance carrier subsidized Apple Watch purchases in order to promote wellness, manage care, and manage use of medications.

Aetna included specific apps on the watch for their customers that were for reminding users when to take their medication, when to order refills, and other healthcare management purposes. The apps also provided insurance information and were linked to Apple Wallet so customers could make payments.

Fast forward to August 2017; Aetna and Apple met to discuss the next steps of their partnership. A small group of digital health influencers, chief medical officers from various health systems, and a select group of Aetna employees attended the meeting; Apple presided over the discussions. According to meeting attendee Mandi Bishop, they discussed data privacy, cost, and future capabilities for solving chronic illness.

For the Apple Watch to make a significant impact on health insurers it has to be beneficial for people who suffer from, costly, chronic illness. This means the watch can’t just appeal to young, fitness conscious millennials. It also has to appeal to the older generation. This is where the future of healthcare and, by extension the future of the health insurance industry, comes into focus.

THE FUTURE OF HEALTHCARE 

Apple has already begun taking steps in this direction. The tech giant released a bluetooth app for the watch that allows wearers to sync the device with a glucose sensor. Apple’s heart rate monitoring feature has also been updated, and studies indicate that eventually the device may be able to predict a heart attack weeks in advance. This opens the door for a future where this small, wearable device can collect important health information and even alert providers about a serious health event.

With Aetna pushing sales of the Apple Watch to their customers, they are essentially promoting a healthier lifestyle that will eventually help reduce costly claims. In the future, the device may be able to alert Aetna when they need to prepare for a major claim.

With Apple’s heart rate monitoring feature for the Apple Watch 3 getting updated even further, it lays the foundation for the future of the healthcare industry and, by extension, the health insurance industry. Given that the partnership between Apple and Aetna is evolving even further, it’s apparent that health monitoring technology in everyday items has made its first small step into the insurance industry. According to the cofounder of String Field Theory, Theoretical Physicist Michio Kaku, this may be commonplace in as little as 10 years.    

In one prediction Kaku details that DNA chips could be inserted into bathroom mirrors ”. You blow on the bathroom mirror. It analyzes your saliva droplets, looking for the P53 gene.” A broken P53 gene has been implicated in 50% of all common cancers, he explained.”Your bathroom mirror will tell you if you have lung cancer. So the whole process, of computerizing your bathroom could change the way we deliver medical care”.

This sort of technology will have major implications on how insurance carriers operate and, in turn, how you as a broker do business. Apple and Aetna have taken the first steps to shaking up the future of insurance.

THE FUTURE OF INSURANCE 

In the auto or homeowner insurance industry, discounts are provided if owners have an alarm system installed, and any other similar elements that reduce risk for making a claim.  Apple and Aetna seemingly have similar plans for the heart monitoring system of the Apple Watch.

One of the first insurance companies to capitalize on this was Vitality. They too jumped on the bandwagon Aetna wheeled out and offered customers of their health and life insurance policies a discount on the Apple Watch. The device works with Vitality’s tracking systems and monitors how healthily active their customers are. This then can result in lower premiums for their clients.

It’s becoming more apparent that a major disruption to the health insurance industry is looming, and these are first steps. Connected devices, new payment systems, and technology in general create new opportunities for companies and services to completely shift the market. As America moves to mandatory policies that promote healthy living, like the Affordable Care Act, such device connected solutions may also one day become mandatory.

If that day comes, employers will search the market for device connected insurance plans as a means to provide mandatory employee health benefits at lower premiums, and they will promote healthier lifestyles to their employees by having them wear these devices. We already see similar patterns from employers. According to a report from the Society for Human Resource Management, more than two-thirds of U.S. employers offer wellness programs as part of their employee benefits package. One day, including health plans that offer discounts on trendy smart devices like an Apple Watch would have incredible value for companies trying to recruit new talent, or retain employees. Aetna’s interest in Apple’s heart rate monitoring feature is just the first step of a long term vision for the future landscape of healthcare and insurance. 

GOOGLE ALERTS FOR THE HEALTH INSURANCE INDUSTRY

In our insurance agency thought leadership strategies post a few weeks ago we outlined the importance of forecasting the future needs of your clients. Given the potential significant influence this may have on the health insurance industry, we recommend that brokers set up Google Alerts  for Apple or Aetna to monitor the ongoing relationship between the two corporate giants. This will help you and your agency stay one step ahead of the game in an ever evolving industry.