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Must-Address Healthcare Consumerism Trends for Hospital Administrators

Diverse group of healthcare providers

Regardless of which side of the aisle you land on in the healthcare reform debate, there are two, clear, unifying points:

  1. The American healthcare system could not survive the way it was headed.
  2. Healthcare consumerism is here to stay.

Even in the midst of a tumultuous reform environment, the majority of us share these two views. We know that many healthcare organizations were falling into crippling debt. We know that our healthcare resources were being stretched thin. And we know that insurers, providers, government and payers alike were not happy with the way the system was operating.

Reform — in some form, whatever the end product may turn out to be — was necessary. So, today, let's take a look at some of the most important healthcare consumer issues hospital administrators should be paying attention to as that reform proceeds and as healthcare consumerism fully blooms.

The clamorous demand for pricing transparency.

We know that the Age of Transparency is upon us. Consumers use the Internet to their advantage: They shop and compare values online. They trade tips and offer purchase advice to each other in forums and on social media platforms. They rate their purchase experiences.

Consumers are now conditioned to the point that they expect to be able to leverage the exchange of information when shopping goods or services in any industry. And in a time when providers, third-party payors and the government are placing more of the healthcare cost burden onto patient-consumers' shoulders, it's accordingly natural that those consumers would demand transparent, up-front pricing.

Do truly ill people want to spend time shopping for healthcare? No, probably not. And, in fact, patients finding themselves in truly emergent situations can’t shop healthcare.

But what about that ambulatory healthcare that isn't rendered to the truly ill or to patients in mortal peril? What about care that is rendered to people who are seeking a faster remedy either to a self-limiting disease, to a non-life-threatening injury or to a nagging chronic problem?

As Frost, et al., argued on HealthAffairs Blog, "less than 7 percent of our healthcare spending is actually paid by consumers on shoppable services."

But the lack of pricing transparency even on that 7% of care can still be a trust shaker

Budget-conscious consumers will want to shop elective surgeries. They'll want to shop primary care and urgent minor care services. They'll want to shop mental health services. They'll want to shop follow-on care line, such as PT, OT, nutrition coaching or wellness coaching. And if they can find transparent pricing information about that small slice of healthcare that is shoppable, it can be a trust builder. In that regard, one could think of ambulatory care in terms of a loss leader — it builds consumer trust in your overall pricing and gets business in the door.

Some experienced healthcare professionals seem to be perplexed by such consumer rationalism. Healthcare consumers are expected to understand the benefits of coordination of care within a single hospital system, not to be influenced by pop media reports or arbitrary quality listings and to be at least a bit more sophisticated than they are.

But healthcare consumers, by and large, aren’t sophisticated: They don’t always make the most rational care decisions, because healthcare is an emotional subject.  They don’t understand the intricacies of care management, and they are influenced by reports and quality measures that seem to present straightforward rankings.

"There is no doubt that we have entered the era of healthcare consumerism," Paddy Padmanabhan wrote for CIO. "However, it is in early stages, with the average healthcare consumer still unaware of the changes in the environment and the increasing range of choices available."

Part of an administrator’s job, then, within the industry, is to educate consumers on how to make better choices for their care and to show them what good care choices look like. That's not going to happen in the initial stages of the healthcare system's move toward healthcare consumerism. It's a longer process than that.

For now, it's pragmatic to understand that the average American consumer would probably shop healthcare the way he or she would shop for a car. And the industry needs to build the structures that allow consumers to do so before beginning to work on the long game — building consumers' trust and knowledge.

Healthcare consumers and their desire for education.

Would you trust a salesman to sell you the right car if he didn't seem to listen to your concerns, if you couldn't understand the technical jargon he used to describe the ownership benefits of a given make or model, and you didn't understand your need for the car to begin with?

Why, then, do doctors expect patient consumers to trust them? Healthcare consumers assume technical excellence in physicians until proven wrong; trust is built upon relationships, excellent communication and bedside manner. To a regular Joe or Jane healthcare consumer, trying to make a care decision in the face of physician pressure is akin to being pressured into making a purchase on the used car lot. It's really no wonder so many patients and their family members turn to WebMD for information — they don't want to be taken in the deal.

The reality is that we need to develop a system that distributes information freely and advises wisely. Providers need to stop talking past healthcare consumers, to stop talking to them and start talking with them, to find out what they actually know, what they think they know and what they have dead wrong.

Then, physicians — and, indeed, entire health systems — need to take a more altruistic and measured approach to educating their consumer base. Consumers need to be taught not only the whats and whys of their healthcare, but the nuances, too. It's the difference between providing a rote education and a rhetorical education. In short, providers need to help consumers develop better healthcare critical thinking skills.

Convenience and politeness are revenue drivers.

There may come a day when even specialists won't be able to keep 9-to-5 hours. We know that convenient hours and location are primary deciding factors for many healthcare consumers — over and above perceived quality of care and perceived value.

For some consumers, it really is all about where they can be seen the fastest. There is a strong incentive, then, for hospital systems to decentralize their service lines, expand footprints into suburban and rural locations and staff around-the-clock. That might result in a shift toward smaller tertiary medical centers, more freestanding secondary clinics and more community hospitals.

Providers must also pay more careful attention to the way that their organizations, as a whole, address patients. Doctors and nurses can no longer get away with talking down to patients, with grumbling or cajoling, or with spending minimal time answering questions — even if the medical decisions they make are consistently sound and correct. All communications — from appointment reminders to educational materials to bills —  received by a patient must be clear and straightforward.

In a consumer-driven industry, the customer's perception of the transaction is the ultimate determinant of a concern's success. And hospitals, practices and clinics are now — more than ever — commercial concerns.

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