Social media: ROI for health plans?


According to the research firm Gartner, Inc., information technology is subject to a five-phase acceptance cycle: a Technology Trigger, Peak of Inflated Expectations, Trough of Disillusionment, Slope of Enlightenment, and Plateau of Productivity. Even zealous advocates of social media marketing (SMM) admit their craft is currently stuck in the disillusionment phase.

According to the research firm Gartner, Inc., information technology is subject to a five-phase acceptance cycle: a Technology Trigger, Peak of Inflated Expectations, Trough of Disillusionment, Slope of Enlightenment, and Plateau of Productivity. Even zealous advocates of social media marketing (SMM) admit their craft is currently stuck in the disillusionment phase.

The Pew Research Internet Project finds that up to 74% of Internet users now use social networking sites. Results from Duke University’s respected CMO Survey show that social media, which currently represents 9.4% of the average.

U.S. corporation’s marketing budgets, will increase to 21.4% in the next five years. However, the 351 marketing leaders who responded to the CMO Survey overwhelmingly report that proof of performance lags spending, with only 15% of marketers reporting that their companies can show the impact of social media using quantitative approaches.

A HootSuite Social Business Benchmark survey similarly finds that, although 88% of business organizations believe social media has a place in their operations, only 40% have found a way to use it to improve their bottom line (see chart). Clearly, the survey results “point to a disconnect,” observes Christine Moorman, director of the CMO Survey.


Social media marketing can also be expensive. A survey published by online social media consultant Mack Collier finds that an outsourced program for all channels can cost anywhere from $3,000 to $20,000 per month, and the industry averaged between $4,000 to $7,000 monthly. Marketing executives cannot be blamed for expecting a demonstrable return on that investment.

Health insurers generally have proven to be late adopters of social media technology, but over the past year, that has begun to change, and all of the nation’s top health plans are now are undertaking at least some SMM. Still, like their counterparts in other industries, they might have trouble making a solid case for its use.

SMM advocates say the key lies in developing a better understanding of what social media marketing can do.

NEXT: Social media outreach


Social media outreach

SMM consultants who spoke with Managed Healthcare Executive emphasize that social media is not a direct sales tool or transaction engine. Direct solicitations for purchase of a product or service conveyed through a social media posting will not produce the same response as an offer made by direct mail, telephone or even e-mail. That is because social media is intended to foster personal relationships. Direct solicitations for business, or information overtly intended to influence purchasing decisions, will seem out of place.

For that reason, the effectiveness of social media cannot be measured in traditional terms such as volume of response. Few social media users will be inclined to ‘Like’, ‘Follow’ or ‘Connect’ with insurance companies or to “Share” or “Re-Tweet” messages from them unless they perceive the value of such messages.

Instead, SMM practitioners urge use of social media outreach to build brand awareness and develop relationships that will result in new referrals and improved customer retention over time. For most businesses, that means engaging target audiences on subjects of mutual interest. For a health insurance plan, it might mean posts on improving health or assistance following a catastrophic event.

“Health plans should think of their Internet presence holistically. Their website and social media platforms aren’t silos, but rather an opportunity to integrate their communications with their customers. Different platforms should be an opportunity to connect with segments of the consumers they serve, but the messages should be the same,” says Sally Poblete, founder and chief executive officer of Wellthie, a New York-based company that offers software to help consumers understand health insurance options.

NEXT: Social media monitoring


Social media monitoring

At the most basic level, social media monitoring can play an important role in customer service. Plan members might post concerns or complaints about insurance plans on social media before calling the company. Careful monitoring of social media can enable insurance plans to identify dissatisfied consumers quickly and immediately interact with them online to address issues. It also affords plans an opportunity to counter unfavorable social media comments directly in a constructive fashion.

Quickly responding to dissatisfied consumers through social media can provide an impressive demonstration of a health plan’s commitment to its members. Because it can potentially help identify problems well before a customer might begin thinking about changing plans, it could also be an important element in member retention.

“Social media can be a way to connect with consumers having trouble with their benefits maximize these channels to get their problems solved and make them feel cared for,” says Poblete. “Responding to complaints through social media platforms is a great way to earn trust-not just with the consumer experiencing a problem, but also with others who see their posts and tweets.”

Social media monitoring also can help insurance executives spot and correct systemic problems within their organizations more quickly. An uptick in negative social media comments could reveal a problem with public perception of an insurance company, dissatisfaction with specific plans, policies or coverage determinations, or operating problems such as billing errors or an unresponsive call center. Effective social media monitoring can help to address such problems before they result in substantial member attrition or emerge as popular topics of conversation among consumers.

NEXT: Improving health


Improving health

Beyond marketing functions, healthcare policy experts widely believe social media could play a role in reducing expenses for public and private insurance plans by encouraging healthy lifestyles and thus improving care outcomes. Many see it as a potentially effective way to enhance provider-patient communications and encourage appropriate utilization of services, compliance with care regimes, or preventive care.

Social media is also being investigated as a means of facilitating communications among providers in coordinated care settings, as well as gauging patient satisfaction with care. lists some 121 studies on the use of social media to address a diverse range of health issues including early childhood care, depression, smoking cessation and predisposition to genetic disease.

The Centers of Medicare and Medicaid Services (CMS) already encourages the use of social media to promote better care outcomes under initiatives such as the Electronic Health Records Incentive Program. United Healthcare, WellPoint, Kaiser Permanente and Humana all have begun offering information on wellness or healthy lifestyles through social media.


Regulatory concerns

Insurers should be mindful that use of social media by health insurance plans can pose regulatory challenges. Communications could in some cases include personal health information or personally identifiable information covered under the federal Health Insurance Portability and Accountability Act privacy and security rules, or under state privacy laws.

The U.S. Department of Health and Human Services’ white paper, The Use of Social Media In Insurance, reviews insurance company and producer uses of social media and regulatory and compliance uses, and provides guidance for those issues.

Three companion publications from the National Association of Insurance Commissioners, Electronic Commerce and Regulation Issue Paper, Market Regulation Handbook, and Marketing Insurance Over the Internet, are also available. Access them at

In addition, CMS has issued guidelines for the use of social media in marketing Medicare Advantage and Part D drug plans, available at

Bob Pieper is a freelance healthcare writer based in St. Louis.

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