Rethinking how it acquires information technologies seems to be giving one insurer an edge, letting it eke out a "trifecta" of lower costs, fewer unhappy customers, and increased revenue.
Whereas many payers opt for battle tested hardware and software products, Aetna broke new ground when it became literally the first customer to buy email authentication software from a startup.
That move was part of a broader transformation that the insurance company's chief information security officer Jim Routh described as "a complete shift in thinking about purchasing products."
The old "no one gets fired for buying IBM" mentality of poring through analyst reports, considering market share numbers, then opting for name-brand IT is perhaps a safer tactic to buying products and services -- but the risk inherent to Aetna's more modern post-Internet bubble approach can have big payoffs.
Lest that appear to be the sort of risk that big companies such as Aetna can more easily afford to take than small and mid-size medical practices, consider the upsides Routh is looking at: less expensive and more innovative products.
First mover advantage It's a well-trodden cliché in the IT world: First mover. And there is some evidence that philosophy is gaining purchase as healthcare continues its widespread industrialization, albeit perhaps slowly.
"There is a correlation between the early adoption of new technologies and better business outcomes." So begins a Harvard Business Review Analytic Services report, sponsored by Verizon. "IT Pioneers -- companies that believe strongly in the benefits of adopting new technologies and that pursue first-mover advantage -- are more likely to lead in both revenue and market position. They adapt more easily to new ways of doing business and are transforming all aspects of their businesses faster than other companies."
HBR breaks the business world into 3 distinct IT types: Those aforementioned Pioneers, the "Followers" and then the "Cautious."
Of the 672 participants, HBR explained that 11 percent identified as working in healthcare and a chart depicting how many of each type reside in healthcare showed a reasonably even split among all three.
That translates to roughly one-third gunning for that first-mover advantage, while another third follow behind once they can learn about pioneers' experience with new IT products. And the cautious simply opt for proven technologies.
Other market segments -- most notably IT vendors but also consulting and energy -- boast higher concentrations of Pioneers.
"By far the most intriguing finding in the research is the correlation between the early adoption of new technology and company performance. Pioneers are growing faster than other companies and beating their counterparts," the study authors wrote. "Twenty percent have experienced more than 30 percent growth, twice that of Followers and more than three times that of the Cautious. Firms that identified themselves as cautious were the most likely to report no growth."
Trifecta rewards Every week Routh and his team at Aetna invest approximately 90 minutes looking at new technology.
"We don't make our bets blindly," Routh said, adding that one of the big criteria Aetna uses for choosing startups is their ability to attract top tech talent.
Technology costs, of course, are another. When Routh started at Aetna, after serving as JP Morgan Chase's global head of applications, mobile and Internet security, among other places, the insurance giant was paying $3 million a year for host-based intrusion detection.
So he found a new vendor for 3-4 percent of that cost. Parlaying that move with a little luck, when that vendor was swallowed by another, Aetna gained the acquirer's white-listing technology as well.
And that e-mail authentication startup Routh was the first to bet on?
It now blocks some 10 million phishing emails a year -- which Routh described as "a trifecta" in that it reduces risks to consumers, cuts operating costs because Aetna is not dealing with customers unhappy about phishing attacks, and increases revenue.
There's one more winning element:
"If the spammers are not making money from spamming Aetna consumers, which consumers are they going to spam next?" Routh joked among competitors and peers at the HIMSS Media and Healthcare IT News Privacy and Security Forum during mid-September in Boston. "I'll help you: Not me. Your problem just got bigger."