Healthcare Must Catch Retail\'s Wave

According Triple Tree Research, consumer-driven care is comprised of three waves. The first fizzled out for the most part; the second is happening right now, and it’s promising; the third will be a game changer for payers and providers who are prepared.

The first wave of consumer-driven healthcare involved the uneven deployment of Health Savings Accounts (HSAs) and other similar payment methods to cover out-of-pocket expenses directly – combined with high-deductible health plans protecting consumers from catastrophic medical expenses. 

The second wave is about “engagement.” With sites like WebMD available to empower healthcare consumers, and providers such as the Mayo Clinic starting to leverage social networks to engage the public, healthcare consumers are better educated and empowering themselves to shop for healthcare services more effectively. 

The third wave will be a fully retail industry providing healthcare consumers with a complete “customer experience” not unlike Ritz-Carlton, Amazon, Zappos, Starbucks and other service-industry leaders. By now most of us have reserved a hotel room, rented a car or ordered a pizza from a business that not only records and maintains our preferences, but uses that data to help us navigate the buying experience, addressing our specific needs and building loyalty. 

While the third wave hasn’t yet arrived, we’ve heard some rumblings: According to media reports, a founding architect of the revolutionary car service Uber plans to unveil a mobile-based on-demand healthcare startup that would bring back house calls. 

Personalizing healthcare delivery is more complex than personalizing pizza delivery, which explains why healthcare lags behind retail and hospitality in ensuring an optimal customer experience. But healthcare personalization is picking up steam, and as with other trends, the first movers will see the biggest gains.

To catch the third wave, payers and providers must learn how to engage with patients. Here’s a key: In a J.D. Power survey, more than 80% of patients said that quality of care is the most important criterion they use in selecting a hospital; 77% indicated that they definitely or probably would use hospital patient satisfaction ratings from a third party to aid them in future hospital selection decisions; and 66% said that high levels of patient satisfaction would be among the top three issues influencing their selection. Retailers collect and analyze this data, and they use it to improve the customer experience. 

Perhaps payers and providers should embrace a concept long familiar to the retail world – IDIC:

·      Identify customers as unique individuals

·      Differentiate by needs

·      Interact earlier

·      Customize offerings and communications

Think about how other industries use technology to create a positive customer experience. When cars approach 60,000 miles, the console screen prompts the owner to schedule a service appointment. Not only that, but the car sends diagnostic data directly to the service department, a preferred car rental is ready when the owner arrives, the paperwork is ready to sign and the car owner is back on the road in minutes. When you have an experience like that, regardless of whether it’s at a mechanic or a medical facility, you’re likely to say good things.

One way you can get to know your customers in advance of the third wave is to track social media the way consumer product manufacturers such as Dell and Gatorade do: They monitor what people are saying about them on Facebook and other social networking sites in real time, capturing and responding to consumer questions, complaints and requests.

Why is healthcare so far behind hotels, airlines, bookstores, automobiles and basically other industries that differentiates customers and delivers personalized experiences? Because many hospitals have more red tape, more regulations, more channels, a tougher screening process, HIPAA laws and other complexities. But make no mistake about it: The second wave of healthcare – transparency and engagement – is here. The third wave – a full-out retail experience – is on its way.

Ron Wince is president and general manager of the Peppers & Rogers Group, a consulting firm focused on customer experience and engagement issues.