consumerism: strategies to meet new market demands and … · 2017-02-17 · loyalty vs....

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Consumerism: Strategies to Meet New Market Demands and

Rising Expectations

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Speaker Introduction

Douglas Ivan Thompson, MBA, FHIMSS

Senior Research Director

The Advisory Board

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Conflict of Interest

Douglas Ivan Thompson, MBA, FHIMSS

I receive a salary from The Advisory Board

Other divisions of The Advisory Board sell software products that address consumer needs.

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Agenda

• The Times They Are A-Changing – What’s New

• The Business Case for Consumerism in Healthcare

• Four Imperatives for Consumer Success – Lessons from Amazon

• Meeting the New Performance Standard – How IT Can Help

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Learning Objectives

• Describe the behavioral and health care patterns of passive and active

healthcare consumers

• Address how expectations differ by patient archetypes

• Discuss a business case for competing on the basis of consumer experience

• Share strategic imperatives to establish a consumer-focused value

proposition, set a high standard of transparency and increase consumer

loyalty, including the consumers point of view

• Highlight new and established technologies required to support these

strategic imperatives

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Benefits of Using IT to Meet Consumer Needs

Increase

Consumer

Loyalty

By delivering excellent

service that exceeds

patient expectations

Improve

Patient

Engagement

Through better

information, service,

and responsiveness

The Times They Are A-Changing

The doctor-patient relationship has evolved since Marcus Welby, M.D.

The Old Reality

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Now you

listen to me!

New Consumer Expectations

Three forces are driving increased healthcare consumerism

More Skin

in the Game

High-deductible health

plans, increasing co-

payments, employers

dropping coverage

More Choices

for Care Delivery

Standalone ambulatory

care centers, retail clinics,

concierge medicine, etc.

Increased

Transparency

Improved information

about cost, quality,

convenience of

individual providers

Source: Advisory Board research and analysis.

Loyalty vs. Satisfaction

Patient satisfaction is a low bar to clear, and doesn’t guarantee loyalty

Why Doesn’t Patient

Satisfaction = Loyalty?

• Patient satisfaction is gained

when expectations are met for a

given transaction or encounter

• Patients generally have low

expectations of provider service

levels—satisfaction is far from

“delight”

• Many patients don’t perceive a

real difference between their

health care providers

• So it doesn’t take much to

convince a patient to switch

providers?

Source: Advisory Board research and analysis.

A Tale of Two Consumers

A new type of healthcare consumer is emerging

Traditional Consumer

65+ the Most Promising to Be Loyal

of 65+ respondents

definitely staying with

their current PCP

70% 21%Avoiding travel was 21%

more important to

consumers ages 65+1

• I’m loyal to my long-time PCP

• I pick specialists and hospitals

based on my PCP’s referral

and my payer’s coverage

• I trust the doctor to decide the

best care for me

• Medical professionals are

responsible for my health

• Medicine is a mystery to me

• I change doctors based on

convenience and price

• I do my own research on-line

• I pick providers based on

convenience, price and service

• I make my own care decisions

• I am responsible for my health

• I am educated about my

conditions and treatments

1. Compared to millennials when deciding where to get surgery.

2. Hospital Outpatient Department and inpatient payments. Source: Advisory Board research and analysis.

New Consumer

Consumer Archetypes

Different types of consumers want different things from their providers

PwC’s “Experience Segments”

Full-Service Frank

Gen X and Y (18-49),

income $50 - $75K,

both genders, lives in

suburb of major city.

Top wants: hassle-

free issue resolution,

good website

content.

On-the-Go

Gina Gen X (33-

49), income

>$100K, mostly

female, lives in

medium/

metropolitan

city. Top wants:

accurate claims

payment.

Traditional Tom

Retirees (66+),

income $25 - $50K

and >$150K, mostly

male, lives in small

city or town. Top

wants: extensive

provider network,

accurate billing.

Brand-Aware

Brenda Boomer

(>50), income

>$100K, mostly

female, lives in

suburb of medium-

sized city. Top

wants: accurate

claims payment,

extensive provider

network.

Budget Brad

Boomer (>50),

income <$50K,

both genders,

lives in suburb of

major city. Top

wants: accurate

claims payment,

extensive

provider network.

Sources: Experience Radar 2012, PwC; art credit: Doug Thompson.

Market Postures

Different types of consumers require different value propositions

Community Pillar

Purchasing Ease

Simplify health care

purchase and use of care

Bargain-Basement Pricing

Win ultra price-sensitive consumer

through rock-bottom pricing

Solutions-Focused

Defend premium price through

product and service

enhancements

Blue Chip Quality

Showcase reputation, clinical

outcomes to win most complex

business

Status Quo New Consumer-Oriented Value Propositions

• Most systems act as the

community pillar today

• Strategy capitalizes on

existing familial connections

and a long-standing history in

market

• Consumers typically see the

community pillar as the default

option, selecting a provider on

preexisting use and trust

Source: Advisory Board research and analysis.

What Would You Build?

Disconnect Between Historical Investments and Patient Problems

Source: Advisory Board research and analysis.

A New Delivery System

Starting from scratch provides opportunity to re-imagine system

Beginning with Patient-Centric

Primary Care Offerings

Clinics without

waiting rooms

Same-day, walk-

in appointments

E-visit

availability

Key Features of Kansas City Locations

Portal access to visit

notes, lab results

On-site healthy

cooking demos

Access to life

coaches

Adding Key Specialties to the

Service Mix Over Time

GI1

Cardiology

Women’s

Services

• Clinicians are mix of former St. Joseph

practitioners and new hires

• Salaried model for two years, then transitioned

to RVU2-based model with quality incentives

Establishing a Consistent Physician Culture

1) GI = Gastroenterology; 2) RVU = Relative value unit.

Orthopedics

Dermatology

Pain

Management

Source: Advisory Board research and analysis.

Traditional Providers Also Responding

Geisinger CEO: We want to be Uber, not Blockbuster

"If we can get that Amazon connect-

ion to people we have the chance to

be the next Uber. If we don’t, I think

we become Blockbuster."

David Feinberg, Geisinger CEO, MD

Case in Brief

• Physician-led integrated health system based out

of Pennsylvania

• Geisinger gives money-back guarantees to

dissatisfied patients

• The patients decide how much they get back—no

questions asked

• In six months just 74 patients asked for their

money back, totaling about $80,000

• 50% of nearby Shamokin city residents are

diabetic and 30% don’t know where their next

meal is coming from

• When diabetic patients order insulin from a

Geisinger pharmacy, they also get a week’s worth

of tasty, diabetic-safe food delivered

Source: Advisory Board research and analysis.

Loyalty - The Ultimate Consumer Goal

Experience key to driving repeat business

Source: Advisory Board research and analysis.

The Business Case for Loyalty

Opportunity for repeat business overshadows value-based purchasing

Source: Advisory Board research and analysis.

Earth’s Most Customer-Centric Company

Amazon’s focus remains unchanged

Source: Advisory Board research and analysis.

How They Do It

Four imperatives drive Amazon’s success

Source: Advisory Board research and analysis.

Playbook for a Consumer-Focused Health System

How IT can help meet the new performance standard

Source: Advisory Board research and analysis.

1. Embed and Customize Provider Search

All roads lead back to your health system

Source: Advisory Board research and analysis.

Embedded Where?

Start with Google and WebMD and go from there

Source: Advisory Board research and analysis.

How WebMD Wins Big in the

Consumer Space

High-Ranking SEO3 Results

Trusted Information Source

Streamlined Online Experience

9/10

Health Searches

Lead to WebMD

The WebMD Audience is Highly Engaged…

9.8Average number

of minutes spent

on WebMD2

10Average number of

pages viewed per

visitor to WebMD

2015 Search Share by Provider

Google

2015 Ad Revenue by Search Engine

Google

Provider Search in WebMD

Providers shown based on search terms

Source: Advisory Board research and analysis.

The Rich Getting Richer

Spotlight initiative expands WedMD value to providers

Source: Advisory Board research and analysis.

Customize Local Provider Search

Differentiate based on coordination, integration, depth of knowledge

Source: Advisory Board research and analysis.

Pardee Select Customizes Provider Search

Online dating comes to healthcare!

Source: Advisory Board research and analysis.

2. Automate Price Estimates

Lack of information loses patients even if your price is cheaper

Source: Advisory Board research and analysis.

Pricing Information Consumers Want

Estimates growing more common, guarantees desired but unusual

Source: Advisory Board research and analysis.

It’s Harder Than It Looks

Requirements complex for out-of-pocket payment estimation

Source: Advisory Board research and analysis.

Sample VendorsOffer a Wide Range of Functionality,

Including Turn-Key Solutions

Clear IQ™

Payment Navigation Compass™

EMR vendors

SurePayHealth™

3. Expose Digital Self-Scheduling Platform

Let patients buy healthcare when they are ready

Source: Advisory Board research and analysis.

Realistic Future Vision

Integrated search, price estimation and scheduling

Source: Advisory Board research and analysis.

4. Continue to Advance Virtual Care

Technology improving patient access, convenience

Source: Advisory Board research and analysis.

5. Enable Hospital Way-Finding

Beacons keep patients from getting lost in the hospital

Source: Advisory Board research and analysis.

Key Takeaways

Improve patient access for greater convenience

Source: Advisory Board research and analysis.

6. Standardize Processes

Geisinger standardizing care delivery…and now the patient experience

Source: Advisory Board research and analysis.

IT Infrastructure for a Reliable Experience

EMR, BI, BPM/workflow, CRM, point applications

Source: Advisory Board research and analysis.

7. Report Quality from a Consumer Perspective

Assess whether the consumer’s problem was solved

Source: Advisory Board research and analysis.

Key Takeaways

Commit to process reliability through automation and measurement

Source: Advisory Board research and analysis.

8. Upgrade Cost Accounting System

Needs for cost data growing with consumerism

Source: Advisory Board research and analysis.

What Should You Charge?

New market postures require new information

Source: Advisory Board research and analysis.

One of These Things Is Not Like the Others

Activity-based costing the gold standard – for now

Source: Advisory Board research and analysis.

Key Takeaways

Cost accounting a key to affordability

Source: Advisory Board research and analysis.

Building a Longitudinal Relationship

Develop services, capabilities that drive loyalty to the health system

Source: Advisory Board research and analysis.

9. Gather and Use Real-Time Patient Feedback

Serve patients better, fix problems before they leave the hospital

Source: Advisory Board research and analysis.

A Call Button In Every Patient’s Hand

App Offers Instant Opportunity for Feedback and Recovery

Source: Advisory Board research and analysis.

Acute Care Patient Portals

Real-time patient feedback just one capability

Source: Advisory Board research and analysis.

Staff Operated Feedback Systems

Support service recovery and systematic process improvement

Source: Advisory Board research and analysis. *Pseudonym

Participating In The Conversation

Social media monitoring brings new opportunities…and risks

Source: Advisory Board research and analysis.

10. Integrate Portal Capabilities With Apps

Loyalty drives portal use, not the other way ‘round

Source: Advisory Board research and analysis.

Kaiser Integrates Portals and Apps

Multiple data inputs, multiple user options

Source: Advisory Board research and analysis.

11. Boost Retention With Loyalty Programs

Healthcare payers and providers learning from other industries

Source: Advisory Board research and analysis.

12. Improve the Billing and Payment Experience

The last impression is the lasting impression

Source: Advisory Board research and analysis.

Moving to Patient-Centered Billing

St. Luke’s overhauls billing and payment process

Source: Advisory Board research and analysis.

Key Takeaways

Focus on making it easier to stay, and harder to leave

Source: Advisory Board research and analysis.

Source: Advisory Board research and analysis.

Playbook for a Consumer-Focused Health System

How IT can help meet the new performance standard

Source: Advisory Board research and analysis.

Playbook for a Consumer-Focused Health System

How IT can help meet the new performance standard

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Benefits of Using IT to Meet Consumer Needs

Increase

Consumer

Loyalty

By delivering excellent

service that exceeds

patient expectations

Improve

Patient

Engagement

Through better

information, service,

and responsiveness

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Questions

• Contact: Douglas Ivan Thompson – thompsod@advisory.com

• Please complete the online session evaluation