The healthcare marketplace never stands still for long. But of late, consumer behaviors have shifted faster than anyone could have anticipated.
Over the last decade, the rise of digital services has stoked an appetite for convenience that many health systems struggle to satisfy. For these consumers, healthcare can feel like a legacy industry in an increasingly digital world.
Joe Ness, COO of OHSU Healthcare, and Preston Gee, VP of strategic marketing at CHRISTUS Health, believe this should change. Health systems should adapt to digital consumerism if they want to have any hope of hanging on to their customers.
Here’s what that consumer behavior looks like, and what health systems can do to buck the trend.
Healthcare consumer behaviors
NRC Health’s research supports Ness’s and Gee’s conclusion. The 2018 NRC Health Market Insights survey, drawing answers from over 300,000 consumer households, makes it clear that patients prize convenience—and are willing to stray outside the traditional healthcare system to find it.
Retail and telehealth on the rise
If there’s a sign of the times for modern healthcare consumption, it’s surely the retail clinic.
Fast, convenient, and (relatively) affordable, they’re emblematic of much of what modern consumers want from their healthcare providers.
They’re also ubiquitous: there’s one within a ten-minute drive for more than 30% of the U.S. population. That makes them an urgent competitive threat to traditional healthcare systems. Their wide availability, in fact, has caused primary-care office visits to decline by 18% from 2012 to 2016, and kept hospital volumes virtually flat for five years.
“We need to be more aware that our customers have lots of options,” Gee says.
Non-traditional providers win customers by offering convenience and speed—virtues not always found in the traditional hospital or clinic setting.
The same forces explain the rapid growth of telehealth as well. Telehealth bypasses even the slight inconvenience of the ten-minute drive, bringing clinicians directly to consumers.
Unsurprisingly, telehealth’s popularity is surging: 60% of employers offer some form of digital healthcare appointments to employees, and Kaiser Permanente reports that 50% of its 2016 patient visits were conducted online through a telehealth platform.
Ness points out that not every health system is ready to offer telehealth to patients. “Telehealth is a major part of evolving our service,” he says. “But it’s going to be a slow trickle to get providers to adopt it—not a big bang.”
Health systems may be well served to hasten provider buy-in.
Deferring care still a problem
When they’re making healthcare decisions, convenience looms large in consumers’ minds. But another factor is even more important: affordability.
Concerns like insurance-network coverage and out-of-pocket costs are guiding lights for patients navigating healthcare. High costs frequently divert them from providers they’d otherwise prefer.
“Even if they like a doctor,” Ness says, “they’ll leave if their insurance plan changes. They just can’t justify paying the out-of-network costs.”
An intimidating price tag can even cause consumers to stay away from providers altogether. NRC Health’s Market Insights data has found that, in both 2017 and 2018, 22.7% of patients have delayed “necessary medical treatment,” citing the fact that they are unable to pay for services.
When patients defer care, it’s to the detriment of everyone. Untreated health conditions frequently become worse with time, leading to unnecessary suffering, more costly interventions and ultimately, worse outcomes.
“The biggest issue of our time is care costs,” Gee says. “There’s a rising chorus of consumers saying that we’re paying way too much for care.”
Unfortunately, health systems have only limited options for resolving the problem of costs. Thin margins and high operating costs leave them little room to maneuver.
What healthcare systems should do
This does not mean, though, that healthcare organizations are helpless. Ness and Gee recommend three tactics that will not only improve how patients contend with the costs of their care, but also help preempt the competitive threat of retail clinics.
1. Bring transparency to billing
For now, the high costs of healthcare are an almost unsolvable problem. It will take tremendous changes to the entire industry to bring prices into line with what consumers are able to bear. Until those changes happen, healthcare bills are likely to remain high.
But they needn’t be unclear or confusing. Transparency in billing shows respect for patients’ preferences and empowers them to make informed decisions about their care.
“It’s time to stop using the cloak of complexity as a reason for not being more price-transparent,” Gee says. “Once we do, I’m optimistic that it will help bring big changes to the market.”
2. Borrow tactics from retail clinics
Retail clinics enjoy a strong advantage in the marketplace—but not an insurmountable one. Traditional providers can win back market share by integrating the solutions that retail clinics bring to consumers.
“‘We’ll meet you where you are’ needs to become an operational priority,” says Gee. “We need to be more flexible with hours and navigability.”
Ness agrees. He argues that what patients really like about retail clinics is their ease and accessibility. “Patients want to be able to schedule an appointment online, for this afternoon. If we give them the digital infrastructure to do that, and if we improve throughput enough to give them the appointment slots, we’ll be much more competitive.”
3. Deliver what retail clinics can’t
That’s not to say that traditional providers should up-end their entire service model. On the contrary, health systems have two powerful advantages that they should press.
The first is continuity. Retail clinics often fall short in communicating with other providers or meaningfully using visit data to personalize care. This is an opportunity for traditional providers to shine.
“Making care a continuous relationship is very important,” says Gee. “Being more communicative and having a better overall understanding of the patient is how a provider stands out.”
The second advantage is humanity. “Healthcare is a people business,” Ness says. “There’s no substitute for that.”
Accordingly, he argues that organizations should tirelessly devote themselves to maximizing the time that clinicians have to spend with patients. The more time clinicians have to talk, the stronger their relationships will be with patients.
“Find systems to support frontline staff. Give them the time and the opportunity to connect,” Ness says.
Still more to learn
Making that connection is a fundamental part of NRC Health’s work. Consumer intelligence is key to sparking meaningful relationships between provider and consumer—and there’s much more intelligence on offer in NRC Health’s 2019 Healthcare Consumer Report.
The full report is available here, and it’s packed with more data-driven insights and expert recommendations. In it, you’ll find:
- Why consumers struggle to invest confidence in healthcare providers
- The single most dominant complaint about care experiences
- Why 31% of consumers prefer to keep their distance from their providers
…and much more.
If you want to learn what your customers said in 2018—and you want to use that information to prepare for the year ahead—click here for the full report.