The impact of consumerism on healthcare has been studied and debated for decades. As far back as the 1970s, the RAND Corporation was randomly tinkering with health insurance deductibles and then analyzing the results. The push for health savings account (HSA) expansion in the early 21st century and the significant overhaul of the individual insurance market by the Affordable Care Act this decade have kept the problem of quality, affordable healthcare center stage.
What have we learned about consumers and healthcare in recent years?
Consumers expect the same things from healthcare and non-healthcare companies
A 2015 McKinsey survey found that consumers hold healthcare companies to the same standards as any other business. Their expectations regarding “great customer service” and “making life easier” were identical across healthcare and non-healthcare companies. Consumer demand for “delivering on expectations” was slightly higher for healthcare, while requirements around “offering great value” were lower by three percentage points.
“You see the pattern in every other industry: people are much more discerning about the value of what they buy,” said Dr. Rod Hochman, president and CEO of Providence St. Joseph Health. “Why should healthcare be immune?”
Loyalty is under fire
The doctor/patient relationship is not the anchor it once was. A survey that the enrollment system developer Connecture carried out found that 71 percent of consumers would at least consider a plan that required changing providers if it meant saving money.
Providence St. Joseph Health is addressing new challenges to loyalty the way successful organizations in other industries do: by focusing on the customer’s end-to-end experience after he or she commits time, money and trust. “Our cancer centers are chosen for reasons that have nothing to do with treatment, because that’s the same everywhere,” Hochman said. “But [patients] know they’ll be able to work with the same nurse throughout, they’ll receive care for their families, and they’ll be introduced to alternative treatments. It’s a consumer-oriented choice.”
A growing majority of healthcare consumers are comfortable with independence
Health insurance was traditionally a brokered, intermediated commodity. That’s rapidly changing. Survey data from Connecture shows that the share of consumers willing to shop for health insurance online “with little to no assistance” jumped from 37 percent in 2012 to 56 percent in 2017. Forty-nine percent seek out reviews from fellow consumers to guide their decisions. And the number of eligible high-deductible health plan participants who have HSAs more than doubled from 2017 to 2018, according to benefit manager Benefitfocus.
Consumers are looking for convenient care — and healthcare companies must respond
According to Convenient Care Association data, there are over 2,300 healthcare clinics in retail pharmacies today, and the group expects that figure to grow to 3,000 by 2020. These offices are typically staffed by a nurse practitioner or physician assistant, and they’re diverting emergency and urgent care clinic visits to retail and neighborhood settings. This signals a broader trend toward breaking up big-box hospital campuses. As an example, Providence has launched ExpressCare in partnership with Walgreens, which allows consumers to digitally schedule same day appointments in a Providence clinic within a Walgreens close to them, initiate a video telehealth visit on demand, or even summon a Providence caregiver to her home — like Lyft for health care.
“A decade from now, hospitals could be little more than operating rooms where you do complex procedures with a whole team of dedicated people,” explained Dr. Amy Compton-Phillips, chief clinical officer and executive vice president for Providence St. Joseph Health. “Virtually everything else could be taken care of somewhere else, in places with a much smaller footprint, at the same quality and at a lower cost.”
Wearable and artificial intelligence tools are personalizing healthcare
Personal choices have a huge impact on health outcomes. The World Health Organization estimates that there are still 1 billion smokers, 6 million of which die annually due to tobacco-related ailments. Personal choices are so significant that research has shown that an overall feeling of control over one’s life can measurably improve health.
Fortunately, almost every healthcare consumer has a personalized healthcare coach in his or her pocket. Given near-universal smartphone ownership and the existence of millions of wearable devices and smart AI agents like Alexa, people can already get trusted insights about everything from sleep management and menstrual cycles to better mental health and medication management. Over time, this will increase demand for personalized, timely information from healthcare providers — and make form letters and long delays seem even more out-of-touch with consumer priorities.
One example of this new personalized care is Providence’s simple, powerful Circle app, which Providence’s Digital team devised to help mothers through the challenges of pregnancy and parenthood. The app is a one-stop, handheld guide to everything from breastfeeding to teenager interactions, and offers a consolidated view of all family appointments with healthcare providers.
“My team is responsible for creating a better customer experience using technology and then engaging consumers between episodes of care,” said Aaron Martin, Providence St. Joseph Health’s chief digital officer, about the Digital Innovation group he leads. “You’re going to see a lot more of that activity going forward from health systems.”
There’s a gap between supply and demand for price transparency
According to an Accenture survey, 91 percent of consumers want clear out-of-pocket healthcare cost information, but most say they aren’t getting it.
The pharmacy benefit world has had a gold standard for over a decade: The federal government offers a plan finder for 42 million Medicare Part D patients. It ranks dozens of plans by total annual cost, accounting for the drugs the patient takes, the retail pharmacies the patient prefers, and available mail order options. But the broader industry has yet to follow suit.
There is no comparable cost estimator available for the larger consumer audience. Current federal regulations require Summary of Benefits and Coverage documents to list expected costs for just three scenarios: a pregnancy resulting in healthy birth, Type 2 diabetes care, and emergency room treatment and follow-up care for a simple fracture.
“We’re of the belief that we’re going to get to pricing transparency, and we will see it first in ambulatory care,” Hochman said. “And people are looking at things, other than cost, that are really important to them, like convenience.”
There’s no going back
Consumer demands cut across geography and demographics, and they’re payer-agnostic. “All of our patients — whether on Medicare, Medicaid, private insurance, or a high-deductible plan — are becoming better consumers,” Hochman noted. “Consumerism is here to stay.”