Three years after Haven Healthcare came in to disrupt the American health care system, the companies behind the effort are bringing down the curtain and going their separate ways. What happened? And what have we learned?
Haven was born under auspicious circumstances. A joint effort between Amazon, Berkshire Hathaway, and JP Morgan, it was created as a means for three titanic companies to pool their capabilities and insights to "provide U.S. employees and their families with simplified, high-quality, and transparent health care at a reasonable cost."
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Less than three years later, Haven disbanded.
Dozens of think-pieces have speculated about why this slam-dunk disruptor failed to bring about the tectonic shift that was both promised and feared by industry analysts. I'm not here to pile on. And I won't point out all of Haven's flaws. Instead, as a benefits industry veteran, I want to share the four underlying barriers I believe proved too challenging for even the most seasoned, not to mention well-funded, professionals to overcome.
Leadership changes lead to a lack of clarity
From its beginnings, Haven was plagued by turnover at the top. First, COO Jack Stoddard stepped down in 2019 after only a few months on the job. Then, the company's CEO, Atul Gawande, left his position in May 2020. The churn of leadership hamstrung the company, preventing front-line employees from understanding and delivering on its mission.
This turnover –- and the stops and starts it undoubtedly caused –- may have also been due to a lack of clarity or consensus about Haven's operational strategy and how they should pursue the company's overall goals. Lack of clarity can frustrate companies in the most straightforward of industries, and health care isn't exactly known for its straightforwardness. Plus, while innovative startups are exciting, in my experience, most people don't want much excitement in their health care plan. But what they do seek is clarity; tools, resources, and access to people – whether virtual or in-person – who can help them make informed, educated health care decisions. Clarity helps ensure the health care journey is one of ongoing engagement and not marked by ineffective stops and starts.
Geography highlighted widespread population needs
Creating customized plans is commonly part of the benefits business model, but it's not for the faint of heart. It takes considerable effort and experience to design plans that meet the populations' needs for communities all over the country.
Unfortunately for Haven, right out of the gate they were faced with large populations spread out across the country in small clusters. None of them were big enough to wield the clout required to force price changes from providers, but they all still needed their own plans. The key takeaway here is that for a holistic benefits plan to be successful, it must take into account the needs of users at multiple, less centralized locations and geographically-dispersed populations, plus be able to align with where they fall on the health spectrum, from healthy to chronically ill. It must also consider those who are actively disengaged from the health care system as well as those who are ready to take action. Tough, I know. Like I said, it's not for the faint of heart.
The toughest competition came from inside the company
Oddly enough, Haven's most significant competition may have come from within its own company. Not long after Haven launched, Amazon got into the pharmacy industry with the purchase of PillPack, an online pharmacy. They then raised the heat by announcing plans to start shipping prescriptions to members with Amazon Prime subscriptions. Earlier, I noted the need for consensus and alignment within the company, and here's another example of how it was sorely lacking. I recognize that consensus and alignment are tall orders, but I believe they can be accomplished by changing one's mindset. I began my career with Ernst & Young in St. Louis and learned early on to treat colleagues like my clients. It's something I've carried with me to this day that has helped me keep the focus on the best way to deliver strategically aligned results. Regardless of one's role within the organization, we're all in it together.
COVID-19 and 2020 didn't help
In future history books, 2020 is likely to get its own chapter. It was a year unlike any other, particularly because of COVID-19. And while we cannot say for sure, the pandemic's financial and operational stresses may have dealt the final blow to Haven.
I know it's not entirely fair to fault Haven for not withstanding a once-in-a-century catastrophe, especially given the company's newness. But during these moments, consumers need the assurance their coverage provides. While very few companies can say they've been around for the long haul, those who make it need a clearly-articulated vision for how to get there.
What the health care industry (still) needs
Our health care system can always be improved. In particular, we need to improve access, provide more mental health care options, and find new ways to control costs without compromising quality of care or service. Regardless of Haven's final chapter, we should all applaud them for trying to tackle that complexity and move the industry forward.
Shea Welch is Vice President, Product & Marketing Strategy at Trustmark Health Benefits.
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