Balancing cost reduction with enhanced member experience
Every smart company knows one thing: creating real value isn’t about doing one thing well, it’s about getting multiple priorities to move in the same direction. Healthcare payers are now facing that challenge. You’ve got to reduce costs, but you can’t erode trust or tank the member experience in the process. If you’re serious about long-term viability, both need to improve, together.
Forrester made this clear in their latest report. They’re urging payers to take an intentional, three-pronged approach. Focus on improving the member experience, reinforcing consumer trust, and lowering healthcare costs. That’s your growth engine. Ignore any of the three, and you’re flying with a missing wing.
You need to invest, especially in digital capabilities, value-based care structures, and benefit redesigns that serve real people. Done correctly, these investments offset costs and drive long-term gains.
Enhancing member experience through personalization and streamlined processes
If customers don’t trust you or don’t like using your platform, they leave. It’s that simple. In healthcare, the stakes are higher and the systems more complex. Improving the member experience isn’t about fluff, it’s operational. It’s interface design. It’s how quickly someone gets help and how understandable the help actually is.
Forrester says member experience starts with trust and relevance. And you earn both by getting personal. Not just targeting demographics, but using real stories from real members to show you understand their lives. This hits harder than polished advertisements.
Tech plays a huge role here. Large call centers don’t scale well when query complexity increases. But AI does. Smart, well-trained AI can instantly summarize previous interactions and maintain context. This directly improves first-contact resolution, the thing members care about most when they contact their insurer. Faster, smarter, simpler.
77% of providers say insurers create unnecessary barriers to care. Only 20% say policies actually align with patient-centered care.
Streamlining administrative bloat, like excessive authorizations, and investing in tools that make workflows cleaner for both patients and doctors is essential. Cut the friction. Make it easier for people to get care. That’s the fastest path to a better experience and deeper trust.
The executive challenge? Experience isn’t a layer on top, it’s embedded in your operations. Don’t patch it. Fix the foundation.
Strengthening cybersecurity to safeguard trust and digital initiatives
Security is not optional. If you’re building anything digital in healthcare, and you’re not integrating cybersecurity into every key decision, then you’re doing it wrong. The healthcare sector knows this better than most, especially after the Change Healthcare cyberattack in 2024. That was more than a technical glitch. It undermined trust at a critical level.
As we digitize more services and expand member access points, we’re also expanding our attack surface. Forrester’s message is clear: cyber risk scales with digital growth. Ignore that, and you risk the whole enterprise. The right approach? Make cybersecurity part of the system from day one. Not a separate feature, not an afterthought. Adopt Zero Trust eXtended architecture. This model assumes nothing is safe by default, not even internal users. It’s disciplined, and it works.
You need to get people up to speed too. This isn’t just about firewalls, it’s about culture. Invest in broad-based tech literacy inside your organization. Train your teams consistently. Keep protocols updated. If it’s not second nature, it’s a weak spot.
And there’s one more consideration. Everyone’s racing to use AI, but very few are thinking clearly about what that means for risk. Whether you build it internally or buy it from someone else, AI has the same vulnerabilities: biased inputs, data exposure, hallucinated outputs. You need a consistent framework for evaluating AI before it goes near your operations. That’s not optional, it’s leadership.
Partnering with digital health firms to deliver targeted outcomes
Digital health isn’t on the fringe anymore, it’s filling essential gaps. The smartest payers know it’s time to stop treating digital health companies like side projects. The new reality is: strategic partnerships here can unlock serious value, if you prioritize where it counts.
According to Forrester, two categories stand out: musculoskeletal and cardiovascular conditions. They represent high-cost populations. They’re also areas where digital tools have already shown the ability to improve outcomes and reduce costs. So why aren’t more plans scaling these solutions? Coverage limitations, loose integration, and conservative procurement strategies have all slowed progress.
That opens a window. Health plans in 2025 should focus on identifying digital health firms that already have validated impact, data-led, results-driven. Don’t just roll out apps for the sake of digital transformation. Target high-use conditions and deploy tools with clinical backing.
There’s also a demographic shift happening that’s worth noting, tech-savvy seniors are steadily growing as a market segment. These members are more likely to use digital tools if the experience is smooth and the value is clear. Engage them early. Drive adoption with outcomes, not just promotional efforts.
The executive move? Digital health isn’t just a feature, it’s capacity. It’s reach. It’s measured in reduced ER visits, lower long-term costs, better patient adherence. Pick strong partners. Set clear performance metrics. Make them accountable. And scale fast.
Leveraging Value-Based care to enhance member outcomes and cost efficiency
Healthcare has been talking about value-based care for over a decade, but most of the industry is still stuck in pilot mode. The potential here is massive, but that’s only true if payers stop hesitating and go all in. According to Forrester, the opportunity isn’t just to lower costs; it’s to improve clinical outcomes and deliver better member experiences at the same time.
Right now, value-based care feels stalled. Many providers don’t fully buy in, largely because data sharing is limited and incentives aren’t clearly defined. Payers need to fix that. Make collaboration not just possible, but frictionless. When providers know how they’re being measured and compensated, and they have access to timely data, the whole system performs better.
Member alignment is just as critical. A major issue is that consumers don’t actually understand what value-based care means. That’s a communication failure. Health plans need to clearly define how these models benefit the member directly, not in theory, but in outcomes they can see: better preventive care, fewer unnecessary appointments, clearer care pathways.
One more layer: the competition isn’t standing still. Direct primary care providers and other employer-contracted entities are moving fast. If you’re managing a traditional health plan and you’re not innovating here, you’re inviting employers to cut you out of the equation.
Innovating benefits to address healthcare affordability
Affordability isn’t just a policy issue anymore, it’s a business risk. Members are increasingly aware of their healthcare costs, and they expect their health plans to do something about it. Premiums, deductibles, prescription expenses, they all influence whether people stay with your plan or look elsewhere. If you’re serious about retention and performance, then innovating your benefits package isn’t optional.
What Forrester recommends is simple: create flexibility. Give members more control. Offer add-ons like expanded drug coverage, primary care with no cost-sharing, or digital health tool access built into the plan. These aren’t giveaways, they’re smart investments. They drive real satisfaction and lower unexpected costs that can derail outcomes.
Education plays a bigger role than most executives realize. Many members don’t know how to leverage HSAs or FSAs. They don’t understand how to navigate their options or compare plan choices effectively. That’s not their failure, it’s yours if you don’t fix it. Invest in transparency tools, real-time cost comparisons, and basic financial literacy on how to manage out-of-pocket costs. Help people make smarter decisions, and they will trust your brand more.
An effective strategy also requires better navigation support, something most plans still underdeliver. When members need help, they shouldn’t hit dead ends. They should be able to connect with someone, or something, that points them to the right care, at the right price, fast.
Stop pushing generic plans. Members want personalization, predictability, and control. Give them those elements, and your cost structure will improve as member outcomes do too.
Strategically integrating primary care services
The market conditions are shifting. If regulatory environments loosen, particularly under a second Trump administration, you’re looking at a surge in vertical integration opportunities. Health plans can acquire or partner with primary care networks at a scale not previously feasible. That expansion is operationally smart, but it’s only valuable if it’s executed correctly.
Forrester’s report makes a clear recommendation: before jumping into deals, have a real integration framework in place. That includes aligning both business models and operational systems to deliver coordinated care. Start by inventorying your internal workflows and technology stacks. Merge without clarity and you’ll create costly redundancies. Integrate deliberately and you’ll produce streamlined operations that improve member outcomes and control cost growth.
Affordability still matters. Consumers are already stretched, stacking provider ownership on top of administrative complexity creates risk, not value. If you’re adding primary care clinics to your ecosystem, make sure it results in lower costs, not price inflation. Waiving cost-sharing on primary services is one actionable way to do it. Done right, it removes access barriers and drives utilization in the right direction.
On the provider side, burnout and shortages remain serious challenges. Health plans must reduce the load, not increase it. That means using tools like generative AI to minimize repetitive administrative tasks, freeing physicians to focus on clinical responsibilities. But even technology won’t solve culture. You need ongoing partnership with provider organizations to create more inclusive, less bureaucratic environments. No alignment, no retention.
Executive takeaway: Growth through integration only works if it reduces friction, simplifies access, and builds a culture that retains talent.
Reforming PBMs for greater transparency and affordability
Prescription drugs remain one of the most visible, and painful, cost drivers in healthcare. If members can’t afford their medications, everything else in the system breaks. That’s why Pharmacy Benefit Managers (PBMs) need to evolve from opaque pricing bodies into engines of transparency and access. It’s not just good policy, it’s a business imperative.
According to Forrester, the most effective PBMs moving forward will deliver real-time drug cost data, clarify formulary designs, and expose financial ties with manufacturers. These aren’t just transparency checkboxes, they build trust. They also allow members to make informed decisions at the point of care, which improves adherence and lowers long-term costs.
Pharmacies also need to be repositioned. Members engage with pharmacists more frequently than with primary care doctors. That creates an enormous opportunity to use pharmacy touchpoints for education, benefit navigation, and support. If PBMs are smart, they’ll reinforce this role by offering tools that go beyond just pricing, ones that guide behavior, improve outcomes, and strengthen plan relationships.
New players in the space are accelerating this shift. Amazon Pharmacy, Mark Cuban’s Cost Plus Drug Company, and Hims & Hers are already reshaping the prescription drug landscape with simpler pricing structures and direct-to-consumer convenience. Partnering with these disruptors, or at least architecting plans that match their clarity, should be on your radar.
The bottom line
If you’re running a health plan, the expectations on your desk aren’t softening. Costs need to go down. Member experience needs to go up. And the tech stack has to scale without opening your systems to unnecessary risk. None of that happens by accident. It happens when leadership gets serious about integrating outcomes, trust, and data into a single operating philosophy.
What Forrester lays out isn’t abstract strategy, it’s the blueprint. Invest in what works. Cut what doesn’t. Prioritize tools that reduce friction for both members and providers. And make transparency, across benefits, pricing, security, and performance, a core value, not a press release.
The market is compressing. Consumers want precision. Employers want value. And competitors aren’t waiting. You’ve got the opportunity to lead by tightening up operations around experience, affordability, and scalable care. The only question is whether you move early or play catch-up.
