Practice Management News

Preparing Providers for the Healthcare Consumerism Shift

Developing a customer-focused healthcare consumerism strategy is key to boosting patient experiences and healthcare revenue cycles.

Providers should develop a customer-focused healthcare consumerism strategy to respond to emerging trends, a Deloitte expert explained

Source: Thinkstock

By Jacqueline LaPointe

- With a couple of swipes and clicks, patients are driving the shift to healthcare consumerism in the palm of their hands. But many healthcare organizations are not finding it as easy to align their care delivery and patient collection strategies with the new trend in healthcare.

David Betts, Deloitte Principal Source: Deloitte

To learn more about healthcare consumerism, many healthcare providers packed their bags and made their way to sunny Florida to attend HIMSS17. As one of the hot topics at this year’s conference, sessions covered everything from collecting patient financial responsibility, developing stronger patient-provider relationships, and unpacking what healthcare consumerism really means.

But one expert at Deloitte’s booth on the exhibit floor stated that redesigning care delivery strategies to respond to healthcare consumerism could be as simple as imagining a visit through a patient’s eyes.

“As we think about healthcare delivery, the key message is that we live in an experience, self-service economy,” David Betts, a Principal at Deloitte, told RevCycleIntelligence.com. “We’ve been very hesitant in the healthcare space to move towards that in some respects because we have taken a very evidence-based, risk-adverse approach to delivering care.”

“At this point, we need to recognize that the experts in what we should be doing are showing up at our front doors every day. Those are the customers,” he continued. “If we engage them in co-designing the solutions, we’ll get better financial performance, higher engagement with staff, and a better customer experience.”

READ MORE: Key Ways to Boost Collection of Patient Financial Responsibility

In a one-on-one interview, Betts shared what is driving the shift to healthcare consumerism, how healthcare organizations can respond, and why developing a more consumer-centric approach is key to boosting financial performance.

Expenditures, electronics, and engagement push on healthcare consumerism

As healthcare consumerism takes hold of the industry, patients are no longer just considered a walking condition to the provider, Betts explained. Instead, providers should be viewing patients as customers such as a retail organization might.

He identified three major reasons why patients are turning more into customers, which included higher out-of-pocket spending, more accessible healthcare information, and family healthcare engagement.

First, since the Affordable Care Act (ACA) was passed about seven years ago, healthcare consumers have seen a rise in spending. With more health plans available on ACA health insurance exchanges in a range of monthly prices, consumers increasingly turned to high-deductible health plans as lower-cost options.

READ MORE: How a Small Hospital Increased Patient Collections by 300%

CMS reported in February 2016 that 90 percent of the 12.7 million consumers on the exchanges enrolled in a high-deductible health plan during the 2016 open enrollment period.

Consequently, almost three-quarters of providers said that they saw a rise in patient financial responsibility, an InstaMed survey showed in June 2016.

“Healthcare customers now have more skin in the game,” Betts said. “They are paying more out-of-pocket and as result, they are behaving as customers are want to do. They shop for their healthcare just like you shop for anything that you buy, like a car or any other major purchase.”

With more financial accountability, many patients are viewing healthcare purchases as if they were at a store and not a hospital.

“They are looking at attributes like cost of care, what their out-of-pocket expenses are going to be, referrals from friends and family, online information, and the levels of the services and interactions they are going to get,” he stated. “Their expectations are what you would expect to have at a coffee shop that you go to or any of the retail businesses that you frequent. Their expectations are set by those companies.”

READ MORE: High Patient Experience Ratings Up Revenue Cycle Management

Second, the rise of the information highway and smartphones also spurred healthcare consumerism, Betts indicated.

“The second thing is that we have a lot more information about what we can learn on our own,” he said. “We effectively have all of the knowledge of humanity in the palm of our hands and customers are bringing that when they are looking for healthcare services. They are coming way more informed about what they are looking for and that challenges the health system to respond.”

While popular websites like WebMD allow customers to speculate their conditions and bring that to their providers, the internet also permits customers to shop around for the best healthcare value. Therefore, providers may need to have competitive pricing or services to retain patients.

Third, healthcare consumers are becoming more engaged with their care because many are not just responsible for their own healthcare, Betts stated. From aging parents to young children, many customers are having to manage the care for other family members.

The healthcare industry, in general, has also felt the pressure from more customers. CMS leaders have expressed concerns that the aging Baby Boomer population, in particular, has strained the Medicare program in terms of care access and costs.

As individuals and the government take on more responsibility for the aging and younger populations, the level of patient engagement is likely to increase as well as the push to find more affordable, competitive healthcare services.

Building more humanity into the healthcare experience

Sprawled across Deloitte’s booth were the words engage, transform, and reimagine. This is where Betts suggested that healthcare organizations start with aligning care with healthcare consumerism.

“What we’re really saying is we need to reimagine the experience from the inside out, walk in the patient’s shoes, and use human-centered design to truly think about what that experience should be,” he said.

By viewing care delivery through the patient’s point-of-view, healthcare organizations can start to see the opportunities for improving the customer experience.

“That’s where we identify some of that low-hanging fruit, which are oftentimes wait times and the physical environment within which care is delivered,” Betts pointed out. “When you look at that from a patient’s perspective, think about your own experience in healthcare. How do we build more humanity into it?”

Healthcare organizations should also focus on setting customer expectations for care, especially in terms of financial responsibility. Some organizations may perceive financial discussions as dissatisfying to the patient, but billing them later without setting expectations could be worse for patient collections and retention.

“We are sometimes over-sensitive to the financial components of care,” Betts elaborated. “We need to be much more straightforward and set expectations and deliver on them.”

Many healthcare organizations have taken similar advice and given patient financial responsibility scripts to front desk staff. For example, a frontline employee can be straightforward by explaining what a patient’s deductible and co-pay are projected to total and asking how the customer would like to pay.

“That can be scripted certainly and that’s there to help the staff to be successful,” he continued. “But it’s critically important to set expectations for the customer, too.”

Ensuring that customers have realistic, clear expectations about their healthcare experience can help providers and other staff live up to the image customers are anticipating. Healthcare organizations do not want to encounter a situation like when a restaurant’s photo of a meal on their menu looks better than the actual thing. Chances are customers are not going to come back and they might tell their acquaintances about the disappointing experience.

Fostering a positive patient experience is only the first hurdle, though. Excellent patient experiences should also be repeatable and consistent across the encounter, Betts added.

“We often engage with clients where they have pockets of greatness, but it’s not consistently applied across the experience,” he said. “We look at how we can help leverage best practices to bring that together and bring more consistency because that’s what you and I expect when we go to the hospital or to a provider.”

In addition, healthcare organizations should implement more self-service technology in response to healthcare consumerism, Betts recommended.

From airport kiosks to walking around HIMSS17, customers are looking more to self-service portals and the doctor’s office is no different.

“That’s where we see some of the digital opportunities,” said Betts. “We’ve become very comfortable with self-service. We’re a bit of a self-service economy. Healthcare is kind of that last batch to adopt it.”

But installing self-service technology at a healthcare organization should be more than just allowing the patient to check-in by skipping the front desk, he added. Self-service solutions should encompass scheduling, registration, patient medical billing, patient collections, and access to educational materials.

Some self-service technology may sound like sophisticated patient portals, but Betts explained that patient portal capabilities are limited compared to self-service options.

“Patient portals were a key component of meeting meaningful use measures,” he continued. “But the requirements of that were relatively limited, such as if I could get a certain number of patients to log in and read their results.”

“With respect to self-service, patient portals, in contrast, were more often designed by the health system to achieve their objectives with meeting meaningful use, whereas the tools I’m describing are designed from the patient’s perspective to enable the patient to meet their needs. It’s a very different design model. Therefore, you end up with different capabilities.”

While the two technologies are separate, they should work together to make a more “end-to-end seamless digital experience,” he stated. Healthcare organizations may even want to consider adding their telehealth options to the digital experience.

Evaluating the healthcare experience

To understand if a more retail-oriented approach to healthcare improves the patient experience, healthcare organizations should use a range of measures to test their strategy, including standardized staff engagement and revenue cycle measures.

“There are some standardized metrics that everybody is using like HCAHPS [Hospital Consumer Assessment of Healthcare Providers and Systems] and patient satisfaction scores,” Betts elaborated. “But I would suggest that patient satisfaction is a combination of metrics. It as a balance score card. So, satisfaction is one, such as what the patients are saying about the experience, and the engagement level of employees and caregivers is another.”

Developing a healthcare consumerism strategy involves giving all individuals attached to the patient experience the tools to succeed. With self-service tools and setting clearer expectations, providers are working to give patients the appropriate tools, but they also need to provide their staff with more resources.

Boosting staff engagement with the healthcare consumerism model should help to improve the patient experience because staff will be more involved with a personalized patient encounter. The American Hospital Association (AHA) suggested in April 2016 that healthcare organizations focus on developing a more “friendly and approachable” environment as well as encouraging positivity with provider-patient interactions.

Additionally, healthcare organizations can look to their financial performance to understand if their patient experience is improving. Betts pointed to results from a July 2016 Deloitte study that found top performance on patient-reported experience scores correlated to higher profitability.

Hospitals that earned “excellent” HCAHPS patient ratings from 2008 to 2014 had average net margins of 4.7 percent. In contrast, low-performing hospitals had just a 1.8 percent net margin.

“The underlying findings of that are that if we deliver a good experience, it results in better financial performance,” he said. “But it’s a little bit of a chicken and an egg situation in some respects. We can’t say causation, but correlation is pretty strong. So, that’s one way you can measure if you’re achieving your objectives.”

Regular evaluations are key to improving the patient experience, but healthcare organizations should also be responding to emerging healthcare consumerism trends. The key to implementing a healthcare consumerism strategy is thinking more like retail organization.

“The healthcare experience actually begins before patients have a healthcare need,” Betts concluded. “It really begins at that front door where every other retail organization is focused on, attracting customers.”