Hartford Business Journal

www.HartfordBusiness.com July 13, 2015 • Hartford Business Journal 15 from page 1 our primary growth market," said Jason Madrak, Connecticut vice president for Harvard Pilgrim, which began selling health plans in the state in 2014. "Our cus- tomers tend to like what they see." Larger health insurance companies have long-dominated Connecticut's market, which has been considered relatively competitive in recent years. Seven major insurers sell health plans in the state, but Anthem Blue Cross and Blue Shield by far owns the biggest market share with 1.1 million members, according to Hartford Business Journal's Book of Lists. UnitedHealth- care has the second largest market share with 470,000 members. The current merger frenzy that has begun to take hold, however, will give the larger companies several marketplace advantages. Consolidation, for example, reduces competi- tion, giving larger insurers greater negotiat- ing power with customers and health provid- ers. They also can use their scale to cut costs and add new products and services. Aetna's proposed $37 billion purchase of Humana will give the Hartford insurer a larger footprint in the Medicare Advantage market. Humana doesn't sell individual or small group health plans in the state, but it does peddle dental and supplemental Medicare policies. If Anthem and Cigna join forces — they've been negotiating a potential merger for months — it will further strengthen Anthem's stranglehold in Connecticut. That has state insurance regulators tak- ing notice. Connecticut Insurance Department spokes- woman Donna Tommelleo said her agency will review any merger or acquisition of a Con- necticut insurance company to deter- mine if it will substan- tially reduce competition in the state or create a monopoly. The Federal Trade Commission and U.S. Department of Justice Antitrust Division will also review if the deals have an anti-competi- tive effect, she said. Finding an edge But being small and nimble will have its advantages, too, Madrak said. The key for small- er insurers to survive and even thrive is to be more responsive to customers' needs and wants, executives say. That's why Harvard Pilgrim uses a "peo- ple and presence" approach, putting its Con- necticut sales force on the ground to provide enrollees more personalized service. That also establishes stronger relationships with doctors and hospitals, he said. "You will see a real difference between our ability to reach out to people and get responses quickly," Madrak said. One key way Harvard Pilgrim and another new Connecticut insurer — Wallingford-based HealthyCT — differentiate themselves is through their not-for-profit business model. Since neither company has to pay or sat- isfy shareholders their profits are reinvested in the company to add new programs and services or stabilize and possibly lower insur- ance premiums. "HealthyCT wouldn't be here — or have more than 30,000 members — if our physician founders, our employees and our members didn't think there was a need, and a place for, an alternative to the big insurance companies," said HealthyCT CEO Ken Lalime. "We'd like to think this would still be the case if the 'bigs' are ultimately allowed to get bigger." HealthyCT also sees its local approach as an advantage, because it makes all of its medical and behavioral health decisions in Connecticut. HealthyCT is sponsored by physicians and, unlike larger companies, offers one net- work of providers for all its members, Lalime said. The company's physician background enables it to incorporate more policies with input from providers and members that help with convenience, such as allowing patients to purchase 90-day prescriptions from a local pharmacy instead of mail-order. Lalime said HealthyCT will wait until after the dust settles to see how the major consolidations impact the market, but the company still is focused on growing its Con- necticut market share. Harvard Pilgrim has operations in Mas- sachusetts, Maine and New Hampshire, but its primary opportunity for revenue growth remains in Connecticut, despite the large insurer mergers, Madrak said. The company's goal is to sign up 13,000 new members a year, Madrak said. During its first year in Connecticut, Harvard Pilgrim was focused on the commercial market. The company soon plans to expand into the indi- vidual and Medicare markets, opening up new pools of business and enabling the company to steepen its growth curve, Madrak said. "As we see these transactions between companies like Aetna and Humana … Har- vard Pilgrim remains extremely committed to New England and growing in Connecticut," Madrak said. n Small insurers tout not-for-profit mission Largest Connecticut health insurance companies (Ranked by Connecticut enrollment in May 2015) Rank Company Total Conn. enrollment 2014 direct written premiums Top CT executive Year licensed in Conn. 1 Anthem Blue Cross and Blue Shield 108 Leigus Road Wallingford, CT 06492 800-922-4670 www.anthem.com 1,116,212 (1) $1,800,000,000 Jill Rubin Hummel 1936 2 UnitedHealthcare (2) 185 Asylum St. Hartford, CT 06103 800-899-7658 www.uhc.com 470,000 DND Stephen Farrell 1993 3 ConnectiCare Inc. 175 Scott Swamp Road Farmington, CT 06032 860-674-5757 www.connecticare.com 326,250 $1,500,000,000 Michael Wise 1981 4 Aetna Inc. 151 Farmington Ave. Hartford, CT 06156 860-273-0123 www.aetna.com 35,079 $95,838,036 Mark T. Bertolini 1853 5 HealthyCT 35 Thorpe Ave. Wallingford, CT 06492 855-458-4928 www.healthyct.org 30,000 DND Ken Lalime 2013 6 Harvard Pilgrim Health Care 93 Worcester St. Wellesley, MA 02481 888-333-4742 or 617-509-1000 www.harvardpilgrim.org 8,000 DND Eric H. Schultz 2014 Source: Individual companies and their websites, state Department of Insurance. Several companies did not respond to the survey or chose not to participate including Celtic Insurance Co., Cigna, Trustmark Cos., and Time Insurance Co. (DBA Assurant Health). (1) As of April 2015. (2) Oxford and Golden Rule health insurance companies are brands under the UnitedHealthcare umbrella. —Compiled by Roger Magnus. THE LIST To view the full list, please visit HartfordBusiness.com HealthyCT CEO Ken Lalime says the insurer's local approach gives it a competitive edge. Jason Madrak, Connecticut vice president, Harvard Pilgrim Health Care P H O T O | C O N T R I B U T E D

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