Becker's Hospital Review

31 Executive Briefing Sponsored by: The Real Reason Loyalty Lacks in Healthcare By Brian Wynne, Vice President and General Manager, NRC Health H ealthcare systems have long been relatively successful at attracting and retaining customers with the "if you build it, they will come" mentality — or perhaps more accurately, "if you build it, they must come." Yet with the meteoric rise of healthcare consumerism within the past few years, most people have an unprecedented number of choices of provider and care options, including opting out of care altogether. As a result, creating loyalists in today's health- care industry is nearly impossible without the right insight into the wants, needs and expectations of those whom we in the healthcare industry hope to serve. The Demand for a Personalized Experience Consumers are scrutinizing the quality and cost of their health- care, and they're more apt and able to look elsewhere when their providers don't measure up to their expectations. Ac- cording to a report by Accenture, 7 percent of customers have switched healthcare providers due to a subpar experience, which could add up to more than $100 million in lost annual revenue per hospital. This number will climb. The value equation in healthcare is al- ready out of balance. Higher out-of-pocket expenditures for ex- tremely personal — and in many cases life-changing — encoun- ters bring with them extremely high expectations for service and care delivery; in fact, a recent study by NRC Health found that 82.3 percent of consumers said hospitals and healthcare systems should consistently meet or exceed their expectations. When these expectations are unmet, the "switch economy," pre- viously seen in all other consumer-driven industries, develops. Since both the risks and the costs of healthcare are high, con- sumers insist that healthcare systems with which they engage understand their preferences and offer experiences to satisfy their needs — perhaps even delight them. Consumers demand that their healthcare be designed and delivered in the same way that other industries they consume and experience are, like retail, hospitality and consumer electronics. Still, few healthcare executives I know would say their services offer an experience akin to that of a luxury hotel or boutique spa. Although we know that high cost means high expectation, there is still hesitance in healthcare to base design on models proven to work in other consumer-driven industries. Why? Because most healthcare systems lack a comprehensive understanding of who their customers are, what they need and how they want to access care. As a result, those systems are un- able to consistently provide personalized and coordinated care experiences throughout their consumers' healthcare journeys — and when the experience doesn't meet the expectation, loyalty becomes an unrealistic and unattainable goal. Customer Confusion = Lost Opportunities The more frequently consumers visit their healthcare provid- ers, the more frustrated they become. According to a report by Prophet and GE Healthcare Camden Group, 81 percent of cus- tomers are unsatisfied with their healthcare experience. What's more, 75 percent of those who frequently use health- care services three or more times a year — and 48 percent of all other healthcare consumers — say they're frustrated. For people to fully engage with their healthcare, it's imperative that they understand the process, their coverage and what to expect from their providers. Research shows that when consumers first embark on a health- care journey, confusion is the primary emotion felt. The reasons for this are intuitive: out-of-pocket costs are a mystery, con- sumer reviews of care providers remain strangely elusive, ex- periences are inconsistent from one care provider or facility to another, hospital consolidations are increasing each year, and consumers are unsure of inter-hospital relationships and affilia- tions. And yet, so few organizations ask their customers, "How can we make your experience less confusing?" or, "How can we reduce the frustration you feel?" A $100-Million Blind Spot According to the U.S. Census Bureau, the average lifetime val- ue of an individual healthcare consumer is $1.4 million or $4.3 million for a family of four. With this much potential spend at stake, the value equation comes under scrutiny. As mentioned earlier, when the cost of a service outweighs the experience it delivers, it sets the stage for consumers to become switchers. Not only are consumers finding new providers in these cases, they're increasingly seeking care from non-traditional care pro- viders, such as chain pharmacies offering primary care and test- ing services, borderless digital e-visit providers and alternative medicine and holistic-healing practitioners. Healthcare systems need to make a deliberate commitment to offer high-quality, Most healthcare systems lack a comprehensive understanding of who their customers are, what they need and how they want to access care.

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