Can healthcare be Uber-ized?

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Uber's foray into healthcare, on the heels of its rapid ascension in the taxi industry, should cause healthcare executives to question the very nature of a healthcare organization and what makes it successful.

Recently, the online transportation service Uber delivered something besides people: flu shots.

Announcing a goal of "bringing house calls back," Uber launched UberHEALTH with a one-day program to deliver free flu shots to customers in New York, Boston, and Washington, D.C. An Uber spokesperson said demand was overwhelming. Uber's foray into healthcare, on the heels of its rapid ascension in the taxi industry, should cause healthcare executives to question the very nature of a healthcare organization and what makes it successful.

Uber is nothing like a traditional healthcare company. It does not employ clinicians or own healthcare facilities. However, by this measure, Uber is also not a taxi company, nor is Airbnb a hotel company. Yet Uber and Airbnb are currently the most influential companies in these industries. They occupy that position without owning taxis or running hotels. For these companies, influence comes from leveraging technology to establish powerful connections with consumers that create an experience light years ahead of any associated with a legacy company.

Consider the experience of a traditional taxi customer compared to that of an Uber customer. A traditional taxi customer stands outside to wait for a taxi, with no foreknowledge of when that cab will arrive. When the cab does appear, it may be anything from a new model to a rattletrap, and the driver may or may not drive safely, accept credit cards or even be familiar with the customer's destination.

In contrast, an Uber customer requests a car on a smartphone with the Uber app. Using the app's GPS, the customer tracks progress of the car to the pickup location and therefore can wait inside until the car arrives. The cars are clean, the drivers know how to get to the destination, and the transaction is handled online with no cash changing hands.

All that is good, but what happens when the ride concludes may be even better. Riders rate the drivers, and Uber takes anything below a top rating very seriously. A limo driver told me that a friend who drives for Uber was called on the carpet when he received a rating below the four-star level. A colleague told me about a time she gave an Uber driver a three-star rating. The next day, she received a call from Uber inquiring about her experience. She explained that the driver struggled to find the destination. Because Uber trips all are tracked with GPS and stored in the cloud, Uber was able to review her specific trip and confirm that the driver didn’t take a direct route. Uber apologized, refunded the cost of the ride and gave her a gift certificate.

As Americans become accustomed to this level of quality and convenience, they will expect it in all of their customer experiences. Companies that deliver a superior experience will be the industry leaders, and the foundation of that experience is connectivity. Traditionally, industry-leading companies have excelled in product development, service delivery and content knowledge. Today, companies that have a dominant connectivity position are showing they can be industry leaders by driving a diverse set of products and services through that connectivity.

Healthcare will not be exempt. Very soon, leading healthcare companies may not have the best clinical outcomes; they may not even own hospitals or employ physicians. Rather, they may be companies that leverage connectivity to drive services to customers in a highly convenient and engaging way.

This movement is well underway, with nontraditional competitors applying technology and customer-service expertise to target market share of traditional healthcare organizations. Today, there are an estimated 97,000 healthcare apps, including ones that diagnose conditions, help you make physician appointments based on your symptoms, and facilitate video chats with doctors. Wal-Mart, which recently opened several primary care clinics and a service to compare health insurance plans, said, "Our goal is to be the number one healthcare provider in the industry." Walgreens' goals include delivering "comprehensive care for its customers by leveraging its community presence in all 50 states" and providing a "differentiated experience that competitors can’t easily match." Google is offering online chats with doctors in partnership with healthcare organizations such as startup One Medical Group, whose business model is based on reinventing the traditional doctor-patient relationship. And now we can add UberHEALTH to this list.

In this environment, traditional healthcare organizations are challenged to meld their core patient care services with sophisticated connectivity to create a high level of patient engagement across the continuum of care. Achieving this lofty goal will require a full-court press from hospitals for two key reasons. First, traditional healthcare organizations face a steep learning curve to reach Uber-like levels of customer connectedness. They will likely need to look outside their organizations for talent or partners to help achieve their goals. Second, hospitals are now competing not with the hospital across town, but with Walgreens, a company whose loyalty program has more than 100 million members; Google, a company that handles more than 40,000 Internet searches per second; and now perhaps Uber, a company whose revenues are doubling every six months. Yet, traditional healthcare organizations have one important advantage: close and in many cases long-term relationships with patients. The challenge now is to bring those relationships into an Internet-connected world.

Kenneth Kaufman is Chair, Kaufman Hall, and can be reached at kkaufman@kaufmanhall.com.

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