NASHVILLE, Tenn.—The insurance industry has always had an uphill battle earning the public’s goodwill due to its unique role as a large, private gatekeeper of healthcare funds. But health insurers have also done themselves few favors in winning over members during recent years, a trajectory Robert Wood Johnson Foundation Senior Policy Officer Katherine Hempstead urged payer leaders to reverse.
Speaking in the Thursday keynote of the 2025 Fierce Health Payer Summit, exactly one year after the killing of UnitedHealthCare CEO Brian Thompson, Hempstead acknowledged that health insurers have weathered exceptional levels of vitriol over the last several months. She told attendees that the shifting policy landscape and consumer demand for expanded access offers clear opportunities for payers to blunt the criticism—but, first, they’ll need to take a hard look at their own unpopular practices.
“I’m talking to a lot of insurers here—so I mean this in the nicest way—but I think there’s been a lot of self-inflicted damage to the customer relationship with some very well-reported stories about things like post-acute care decision algorithms, or batch processing of prior auth requests, or home visits and upcoding, or ghost networks and Medicaid,” Hempstead said at the event.
“These are all things that—I’m sure there could be another side to them—but these are all things that don’t land well and, I think, really confirm and sort of double-down people’s preexisting suspicions about insurers being interested in their bottom line versus the well-being of their policy holder," she said.
Health insurance, she admitted, has found itself in a “hard market.” Care costs continue to rise due to trends only somewhat under plans’ control, such as increasing drug costs or overutilization, and other pressures that require policy intervention to address. And, while the old mantra of “no margin, no mission” has some truth, she suggested that lately there’s been “more margin than mission” within the industry and a dearth of long-term thinking.
“Okay, you’re in a hole. Stop digging,” Hempstead said. “See what you can do to reduce friction and pain for your customers.”
One such area, and an area where many of the largest payers are already taking steps forward, is simplifying prior authorization, she said. Pricey GLP-1 drugs for weight loss represent another area where insurers are “setting up just incredible hoops for people to jump through” even as estimates from the life insurance industry suggest full deployment of the treatments could reduce mortality by 8.8% in 20 years.
“Wouldn’t it really make sense for everyone to get on board with that and try to make that happen?” she said. “Instead, we see a lot of companies are dropping, a lot of companies are making things really hard, and they’re not ever talking about those population health benefits. I know that everyone in insurance knows that our system has bad incentives, create bad incentives to do the right thing and has a very short-term focus. … It would be awesome to have a little bit of support for some sort of longer-term thinking, from a population health perspective.”
Hempstead acknowledged that her advice isn’t “what McKinsey would tell you” but would help payers repair their damaged relationships with members while addressing many of their unmet demands. The individual markets, despite staring down the barrel of premium spikes, could be a good avenue for such outreach and innovative offerings, “because they’re choosing you—which is also true of Medicare Advantage and, to a certain extent, in Medicaid,” she said.
What’s more, she said the current direction of health policymaking, particularly around preventive care, has “served up on a platter” the chance for private sector insurers to take the reins and position themselves as thought leaders. Insurers could take on that mantle by designing benefits to include vaccines or preventive screenings that find themselves no longer recommended by federal bodies, and through advocacy for cost-effective coverage expansions.
“I think it won’t be long before we’re having some more serious conversations about … where we can maybe spend less money and cover more people,” Hempstead said. “Wouldn’t we all really be better off if we could do that? … That is a conversation that I hope insurance leaders can participate in, because I think they have a lot to offer and they would have a lot to gain if we had a better system.”