The great healthcare experiment; will consumers buy on value or price?

It’s the great healthcare experiment really when you stop and think about it.  Today, thousands of individuals are going to public and in some cases private exchanges to purchase health insurance for themselves and families. Different levels of plans, varied coverage’s, deductibles and copays with open or limited networks, drug benefits etc.

So the healthcare consumer is now making the grand choice. Will they choose value by what they perceive based on experience, relationship and no real outcomes data to make a rational decision to keep the doctors and hospitals in their network? Or, will the healthcare consumer now shopper for care, decide to choose by price and consider value as a given among all providers.

There probably at this point no definitive answer to the question. The signs are all around that healthcare is evolving to a semi-retail market.  And the decision now facing healthcare consumers of choosing healthcare via insurance by value or price will only accelerate change.

When an individual is facing a decision with multiple price options, they will exhibit consumeristic behaviors and shop on price when all else is perceived as equal.  And healthcare for all intent purposes, is the ultimate (and pardon my use of a sports analogy, just can’t help myself) example of league parity in the minds of consumers.   Seen one doctor, seen one hospital, and seen them all.  For years healthcare providers have offered up platitudes of world class care, best doctors, high tech, Centers of Excellence and so on, that value is totally undifferentiated. In the absence of information, markets like nature abhor a vacuum. Price fills the void.

Now that the barn door is open and no getting the horse back in, what can a healthcare provider do? No simple answer this time around. Healthcare consumerism is a new phenomenon in healthcare. To adjust to that seismic shift, the healthcare provider regardless of type will now need to get serious about brand, outcomes, value, experience and price.  Total transparency really.

Oh and one other thing, the conversation with the healthcare consumer and newly insured is going to have to change from just stating that we are the best, to here’s why we are the best and what you are the best at.  Can’t be great at everything and the healthcare consumer already knows.

This is going to be a struggle for most healthcare providers.  It will be as much about changing internally as externally.  Going from being in control of the process, to being subjected to the needs and wants of consumers on a value, quality and price basis is not an easy transition.  Some will make and others will fail.  That’s life. That’s the nature of markets.

Take a look at the marketing strategy and organizational readiness as well as the consultants that you hire. Are they telling you here is your best customer go forth and fill the beds, or are they preparing you to be a responsive healthcare consumer-centric organization in how you approach the market and win the confidence and dollars of the new healthcare consumer?

It’s the great experiment; healthcare choice purchased on value or price. Something tells me that price will win the day. The horses are out of the barn.

Michael J. Krivich, MHA, FACHE, PCM, is an internationally followed healthcare marketing blogger with over 5,000 monthly pages views read in over 52 countries worldwide on Healthcare Marketing Matters. These views are my own. He is founder of the michael J group, a Fellow, American College of Healthcare Executivesand a Professional Certified Marketer, American Marketing Association.  Like us on facebook at the michael J group, and connect with me on LinkedIn and Twitter.

How are you improving market share and revenue in healthcare?

As healthcare evolves into a consumer-centric, semi-retail market with you existing in a multitude of reimbursement schemes each nuanced for a different market segment, have you  identified from a marketing perspective immediate actions to  improve your market position and revenue generation?  This isn't about massive advertising campaigns, gimmicks, wellness programs, etc. It’s more about getting the basics right, understanding who pays for what and how, the needs of your healthcare consumers, as well as driving demand, managing demand and moving demand to the right locations. In some circumstances it may even mean de-marketing certain services.

This is a difficult question to answer given the focus and preoccupation with hospitals and health systems, with EMR, readmissions, cost reduction, quality improvement, etc., but at the very least, it does not mean that marketing leadership cannot make a difference in their organizations, lead change and make a meaningful, measureable difference.

So very quickly, here are seven ways to improve your market position and generate revenue.

1.  Brand and competitive position.

Consumers and patients are ready for convenient technology-enabled access to care. Healthcare providers that are capable of identifying their needs and how they want their healthcare needs meet though technology focused on them, will gain new patients and the next-generation of physicians.  It's not a crime to use text messaging to send people information or confirmations about appointments, health reminders, or use QR codes to link to specific education or health offers.

 2. Engage existing customers and patients.

An individual is only a patient 1/3rd of the time they come in contact with you.  That is during the diagnosis, treatment and recovery phase.  Pre and post this, they are a consumer not a patient.  So why then is it the only time you meaningfully engage them is during the period when they are a patient?  Doesn't make a lot of sense really. Consumer and patient engagement is about all of the time, not just some of the time.  Engaging the individual on a continuous basis builds loyalty and return use or repurchase behavior.

3. Engage the physicians.

No matter the payment model you will still need a physicians or physician extenders order to get anything done in a healthcare setting. That means engaging physicians in meaningful ways, using the methods, technology and systems that will make their life easier, improve their productivity and protect or increase their income. An effective and efficient physician has more to do with the impact of cost and quality in your organization then you control.

4. Focus on the physician experience.

How hard is it for a physician or physician extender to practice medicine in your organization?  Have you looked at the hassle factor that physicians encounter when they try to get things done in your care setting?  Understand how the physician experiences your organization at every touch-point they encounter you. Understand their experiences overall from beginning to end, not just in an isolated segment. Fix what is broken, keep what is working. The more satisfying the experience, the better you will do financially.

5. Focus on the consumer/patient experience.

A healthcare provider's ability to deliver an experience that sets it apart in the eyes of its patients and potential patients from its competitors - traditional and non-traditional - serves to increase their spending and loyalty to the brand. You need to actively manage the customer experience in total by understanding the customer's point of view.  That is, all touch points internally and externally that a customer/patient comes in contact with which in turn creates the experience. Exceptional experience means gains in market share, brand awareness, and revenue.

6. Embrace retail healthcare.

Traditional ways of delivering healthcare will go by the wayside in many cases.  Price convenience, access and outcomes are the drivers in retail healthcare.  Find the need, understand the consumer’s behavior drivers, design offering around the consumer not you in a convenient location and price it appropriately. If you can't compete in this way, your market position, share and revenue will erode.

 7. Turn to social media and networks to engage, manage the experience and drive adherence.

 

As healthcare continues the evolution to a healthcare consumer dominated semi-retail environment, social networking is a healthcare marketing channel that is underutilized and underperforms today, but holds great potential to improve engagement, experience and adherence. And that takes healthcare marketing leadership, executive vision and meaningful action.

 
Seven step to market and revenue growth in an evolving healthcare market place. Not an impossible task, but one that does require focus. In the ends it's all about:

 

Michael J. Krivich, MHA, FACHE, PCM, is an internationally followed healthcare marketing blogger with over 5,000 monthly pages views read in over 52 countries worldwide on Healthcare Marketing Matters. These views are my own. He is founder of the michael J group, a Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association.  Like us on facebook at the michael J group, and connect with me on LinkedIn, Twitter, and Pheed

Can hospitals adapt to the new market drivers of price, outcomes and experience?

Over the past week there has been a great discussion going on in LinkedIn in the Modern Healthcare discussion group based on a recent blog post in HMM. So for the benefit of everyone here are the questions I was asked, and my response.

Why do I think price is important to the healthcare consumer?

It really centers on whether or not you believe that healthcare, especially hospitals, are moving into a market that is becoming consumer-centric and dominated. Now dominated in our sense is that the healthcare consumer is becoming more actively involved in the treatment decision making process, and the price/cost side through a variety of mechanisms, whether that is higher co-pays, participating in exchanges, working for an employer that has moved to defend contribution and telling them to figure it out, etc. In the end it results in a greater awareness of the choices they make because it hits them in the pocket.

Some people will pay a higher price because they believe that higher price means higher quality. Other will not, and some will fall in-between depending on that needs to be done within their own value system and financial state.

Can experience and outcomes trump price as market drivers?

I would generally agree that experience and outcomes have the potential to trump price, but only in an environment where the experience and outcomes are understood by the healthcare consumer. Hospitals overall, not all mind you, but overall, haven’t defined and executed on a consistent experience, and haven’t communicated meaningful information on outcomes. So until some takes the lead in their market and takes those steps, it will be difficult for experience and outcomes to trump price. Silence in this case is deadly. Once a hospital takes that position in the market, and we all know that sooner or later a hospital will in a competitive market, and then the others will be at an extreme disadvantage to some healthcare consumer segments in the market.

Quality is not an issue here. For years we have been telling everyone that we have high quality as providers. The problem with that message is that it is undifferentiated in the market, hence the public’s perception that all hospitals are of equal quality. So in the absence of true outcomes of quality data, price and out-of-pocket expense becomes the market equalizer.

We cannot define quality as an award logo from a third-party organization which is another common practice. With no context to set the content in, it is meaningless to the healthcare consumer, especially when a hospital or health system uses it, and then loses it, and continues to say and use it from a previous time period. I mean really, did anyone ever think maybe the healthcare consumer would ask why don’t you have that quality award this year? Quality award logos on ads and materials causes more harm than good if there is no context or content around the award.

Are hospitals hiring marketing talent other healthcare industries?

On the issue of marketing talent in hospitals, I find anecdotally from those in pharma, med device and other health channels that have moved to the hospital marketing side, find it extremely difficult and frustrating to work in marketing in hospitals. More often than not these individuals have a great deal of experience, talent and a level of understanding of marketing, and executing on the marketing vision that few hospitals possess at any level of the organization. Many hospitals in their search still look for marketing talent focused on purely hospital marketing experience. Except in rare cases, that results in a continuation of bad marketing practice and reinforces the “make things look pretty notion” of marketing in some hospitals.

Unless hospitals start to figure out what they don’t know about marketing in a consumer-centric environment, and there is a lot they don’t know or have the experience having never worked in that type of environment, they are in for some real shocks beyond what they are already experiencing. In the end they need these marketers from other healthcare segments that can lead and guide marketing change. Only hospitals can recognize and can make that change before it’s too late.

Michael J. Krivich, MHA, FACHE, PCM, is an internationally followed healthcare marketing blogger with over 5,000 monthly pages views read in over 52 countries worldwide on Healthcare Marketing Matters. These views are my own. He is founder of the michael J group, a Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association. Like us on facebook at the michael J group, and connect with me on LinkedIn, Twitter, and Pheed.

Will you be the first to market healthcare consumers along price, outcomes and experience?

Your price information is out there. Your outcomes information is out as well. And you already have developed by word-of-mouth either a positive or negative patient experience reputation. Whether you like it or not, the horses are out of the barn and it’s too late to corral, get them back into the barn, and pretend like it never happened.

As the hospital segment of the healthcare industry evolves to a more consumer centric model along the three dimensions of price, outcome, and experience, will you use that publicly available data to differentiate yourself to potentially establish market dominance along those brand dimensions that you excel?

This is not a frivolous marketing question. This is about how you are going to be competing in the near future. The healthcare brands of hospitals and health systems will come to be defined by these attributes.

And don’t think that the industry is so unified that no one will make that first attempt to define their market vies a vie their competitors along these three attributes. It is just a question of time before a hospital or system regardless of tax status claims a leading market position. Then what are you going to do?

If one were to diagram what it will look like to the healthcare consumer who will have some fair amount of control in the decision making process, it could look like this:

And the sweet spot is where all three intersect. But that being said, you could take one of several positions in the marketplace. You could decide to be the LDRP of healthcare. You could decide that price and experience are your brand position, and that matches to your healthcare consumer’s needs. Maybe its price and outcomes, price and experience, or experience and outcomes defines your hospital or system brand position.

But to take any kind of position in the healthcare market place without the market research to understand the healthcare consumer, their needs, and decision making process in an evolving market is not wise. No more guessing. No more thinking that you know what the healthcare consumer is thinking.

Healthcare markets for hospitals and health system are heading to a place where they have never been, namely a consumer-centric model boarding on retail. And as more people have a higher cost stake in the game as their costs continue to grow, consumeristic choice behaviors will take place whether you like it or not.

So here are your choices. You fight the losing battle against price and outcome transparency wasting significant energy and resources to stop a wave washing over the healthcare industry like a tsunami. Wait until one of your competitors takes one or all of these brand positioning options away from you. Hide from all of it hoping that it will all go away. Or, figure out what the best fit is for you that you can deliver on day-in and day-out to claim that brand position with the newly minted healthcare consumer.

Because you know as well as I do, that someone will do this despite all the wailing, howling of outrage, and head in the sand approaches to change going on in the healthcare industry. And by then it will be too late for you.

Michael J. Krivich, MHA, FACHE, PCM, is an internationally followed healthcare marketing blogger with over 5,000 monthly pages views read in over 52 countries worldwide on Healthcare Marketing Matters. These views are my own. He is founder of the michael J group, a Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association. Like us on facebook at the michael J group, and connect with me on LinkedIn, Twitter, and Pheed.

How can you quickly improve healthcare market position and generate revenue?

Have you ever taken a step back and from a strategic standpoint looking at what you can do to nearly immediately improves your market position and revenue generation? This isn't about massive advertising campaigns, gimmicks, wellness programs, etc. Its more about getting the basics right. The blocking and tackling that you need to do now, to prepare for risk and value-based payment models. If you can't get it right in fee-for-service model, then how do you expect to get it right in a risk model?

So very quickly here are six ways to improve your market position and generate revenue.

1. Brand and competitive position.

Consumers and patients are ready for convenient technology-enabled access to care. Healthcare providers that are capable of identifying their needs and how they want their healthcare needs meet though technology focused on them, will gain new patients and the next-generation of physicians. It's not a crime to use text messaging to send people information or confirmations about appointments, health reminders, or use QR codes to link to specific education or health offers.

2. Engage existing customers and patients.

An individual is only a patient 1/3rd of the time they come in contact with you. That is during the diagnosis, treatment and recovery phase. Pre and post this, they are a consumer not a patient. So why then is it the only time you meaningfully engage them is during the period when they are a patient? Doesn't make a lot of sense really. Consumer and patient engagement is about all of the time, not just some of the time. Engaging the individual on a continuous basis builds loyalty and return use or repurchase behavior.

3. Engage the physicians.

No matter the payment model you will still need a physicians or physician extenders order to get anything done in a healthcare setting. That means engaging physicians in meaningful ways, using the methods, technology and systems that will make their life easier, improve their productivity and protect or increase their income. An effective and efficient physician has more to do with the impact of cost and quality in your organization then you may have considered in the past.

4. Focus on the physician experience.

How hard is it for a physician or physician extender to practice medicine in your organization. Have you looked at the hassle factor that physicians encounter when they try to get things done in your care setting? Understand how the physician experiences your organization at every touch-point they encounter you. Understand their experiences overall from beginning to end, not just in an isolated segment. Fix what is broken, keep what is working. The more satisfying the experience, the better you will do financially.

5. Focus on the consumer/patient experience.

A healthcare provider's ability to deliver an experience that sets it apart in the eyes of its patients and potential patients from its competitors - traditional and non-traditional - serves to increase their spending and loyalty to the brand. You need to actively manage the customer experience in total by understanding the customer's point of view. That is, all touch points internally and externally that a customer/patient comes in contact with which in turn creates the experience. Exceptional experience means gains in market share, brand awareness, and revenue.

6. Embrace retail healthcare.

It's not going away as some may still think. There is a reason why Walgreens just purchased a health plan with millions of potential customers coming online for insurance and medical care in 2014. Traditional ways of delivering healthcare will go by the wayside in many cases. Price convenience, access are the drivers in retail healthcare. Find the need, understand the consumers behavior drivers, design offering around the consumer not you in a convenient location and price it appropriately. End of story. If you can't compete in this way, your market position, share and revenue will erode.

Six steps. Not so easy, or not so hard. Just takes courage and leadership.

Michael Krivich is an internationally followed healthcare marketing blogger with over 4,000 monthly pages views in over 52 countries worldwide. He is founder of the michael J group, a healthcare marketing consultancy dedicated to creating value through strategic marketing for hospitals and health system regardless of payment mechanism, either fee-for-service or value-based to increase market-share, revenue , brand and demonstrate actual return on marketing investment. Michael is a Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association.

Will price competition change healthcare marketing?

The game is changing. Rapidly.

Game changer. That's what I call Aetna's introduction to its members, of its easy-to-use, out-of-pocket payment estimator. Simple really, know the cost of a test, visit or procedure; know what it will cost you. But it doesn't stop there, it allows the healthcare consumer to compare the cost across multiple network providers. You can compare costs across 10 different hospitals and doctors.

WellPoint through its AIM subsidiary has shown where it was possible to incentivize physicians and plan members, to shop for radiology services and choose the lowest cost provider. It's reducing healthcare costs; while maintaining quality.

United HealthCare, though its Innovation Center , is empowering its clients and 70 million members across a broad array of data driven products and services, for the healthcare consumer to better understand their healthcare utilization, and make cost effective choices.

And these are just a couple of the price and cost decision-making information tools that the healthcare consumer is starting to receive. Nothing like having higher out-of-pocket expenses, coupled with the ability to obtain pricing information, combined with the ability to estimate your own costs to get healthcare consumers to pay attention. Shopping for care and it's not mystery shopping..

Member co-pays and deductibles are rising. Employers moving to defined contributions. Millions of individuals potentially coming online with health insurance in 2014. Healthcare consumers are facing the economic reality that they now have some "skin-in-the-game". Can you really think of any better way to control healthcare costs by introducing a level of price competition and providing information which really up until now, was essentiality unattainable?

Forget the quality argument.

Just because you charge more doesn't mean you have higher quality. The healthcare consumer already assumes quality. And they assume that it is equal across multiple providers. Saying you have high quality when you are unable to differentiate yourself in the market, because you won't use outcomes data, is a claim that falls on deaf ears. It's a given. It's the business you are in.

So now , pricing begins to rear its head in the healthcare consumer's decision-making process. And when all other things are equal, in the mind of the consumers, price wins. Quality is assumed. Caring is assumed. It's what you do.

Your marketing needs to change.

Most healthcare organizations aka hospitals, have never really had to deal with the pricing equation on a competitive basis. For insurance, medical device, pharma and other suppliers to healthcare, price competition has been a requirement in their markets since the beginning of time.

Now, doctors, hospitals, and others will need to change their marketing operations and begin to deal on price. Your brand takes on new meaning when price and choice become a critical component in the healthcare consumer decision-making process. High price, undifferentiated quality, won't sell.

Competing on price vs. claims of quality requires a different set of marketing skills than what you have traditionally found in most healthcare marketing operations. It requires more than a communications skill set, or senior leadership thinking that they know how to market.

Change is never easy, especially old attitudes towards the value of, and need for, healthcare marketing.

Repeat after me: Brand, Value, Price.

Michael Krivich is an internationally followed healthcare marketing blogger with over 4,000 monthly pages views in over 52 countries worldwide. He is founder of the michael J group, a healthcare marketing consultancy dedicated to creating value through strategic marketing for hospitals and health system regardless of payment mechanism, either fee-for-service or value-based to increase market-share, revenue , brand and demonstrate actual return on marketing investment. Michael is a Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association.

Where is the patient experience and satisfaction in your healthcare marketing?

Patient experience and satisfaction is no longer a nice too have, but a got to have in healthcare. Difficult to achieve and tough to beat once you have it, experience and satisfaction with your medical products, clinical services and processes regardless of the vertical, be it specialty pharmacy, medical device, pharma, hospitals, doctors etc., will drive revenue. Revenue from the standpoint of Pay-for-Performance (P4P) programs and volume from consumers aka patients, selecting you in a very commoditized and provider undifferentiated healthcare market place. As you create your networks, Accountable Care Organizations (ACOs), Medical Homes (MHs) and other yet undefined organizations, you have the opportunity to "get it right" this time.

The healthcare consumer of today, will view your services as: value= f(cost, quality, satisfaction) as compared to the near past where value= f(cost, quality). Value here is the defining moment and is a function of cost, quality and satisfaction with you.

Why is it important?

High levels of experience and satisfaction are a powerful differentiator on your market.

Done correctly, your experience improvement and satisfaction program becomes the ongoing Voice of the Customer (VoC) program to drive real organizational change.

It is a strategic and tactical edge for your brand and your marketing communication efforts.

Think customer evangelization.

Think of the power of a high-quality experience and exemplary satisfaction, and what that can do for your marketing campaigns. What it can do in your effort to differentiate.

The choice is yours. The marketing implications, strategies and tactics are clear. Lead or be left behind.

Are You Engaged in Disruptive Healthcare Marketing?

This is not about guerilla marketing. I am writing about engaging in what I call Disruptive Healthcare Marketing (DHM). DHM is a process that moves you from looking like a "me too" in your healthcare marketing, to forcing competitors into changing their game, reacting to you.

If for the sake of argument, you can agree that there is little meaningful differentiation, healthcare is becoming a commodity, price competition is beginning, and the healthcare consumer is becoming more empowered and taking control, then why would you continue to market the same old ways and play follow the leader in your industry vertical? Isn't that the definition of insanity? Doing the same thing over and over again and expecting a different result.

Disruption is occurring across healthcare on a daily basis and well into the foreseeable future. So why isn't healthcare marketing keeping pace?

Much healthcare marketing is like Lemmings in a herd, falling over the cliff because everybody else is. If your marketing is so effective, then why do executives, especially in hospitals, talk of being in survival mode? Sounds like what you have been doing isn't working.

Disruptive Healthcare Marketing is contrarian in nature.

That's right, DHM is contrarian in nature, because you don't follow the leader and change a few things in an effort to look different, with the same essential message. It's about finding those meaningful points of differentiation that your consumer is looking for that will resonate. You ask the hard questions. You do the grunt work. You challenge conventional thinking. You challenge the culture and beliefs of the organization. You look at why someone is taking a particular strategy path, and understand why they aren't doing something else. You lead. It's about going in a different sustainable directions that builds volume, revenue and market share.

Everyone is chasing the same healthcare consumer and looking the same in the process.

Really, is your customer/patient satisfaction that much different from your competitors? Are your hi-tech medical devices so amazing that healthcare consumers and purchasers will flock to your doors? Can your valet service "out customer experience" the healthcare provider on the other side of town? Can your specialty pharmacy clinical sales tell you, without a 50 slide deck, in 25 words or less, how you are better than a competitor? Can you do a presentation to an insurer that that's not 80 slides of, all about you?

Are you saying to your marketing department, look what they did?

If yes is the answer to any of the questions, then you are not engaged in Disruptive Healthcare Marketing.

A Disruptive Healthcare Marketing model can look like this:

Disruptive Healthcare Marketing utilizes marketing in a strategically focused plan, to provide meaningful differentiation, positions you as the leader and create a brand story with lasting marketplace presence. It is highly integrated, sustainable and focused. DHM changes the organization. It will make you uncomfortable. But then, if you're not uncomfortable, then you really aren't changing.

Insert any audience in the center of the model and you have Disruptive Healthcare Marketing. Integrated, coordinated and not based on what your competition is doing, but upon you, your brand and your differentiable, sustainable message points.

Change or be changed. You decide.

You can continue the conversation with me on:
LinkedIn: http://www.linkedin.com/in/krivich0707
Twitter: http://www.twitter.com/mkrivich
Web site: http://www.themichaeljgroup.com

For more information, or to discuss your strategic healthcare marketing, customer experience management, marketing/sales integration or start-up needs, you can learn more at my web site the michael J group; email- :michael@themichaeljgroup.com or phone by calling me at 815-293-1471.

Is Meaningful Differentiation Lacking in Healthcare Marketing?

The other day, I was reading my local community newspaper, the Herald-News and a national publication, The Wall Street Journal. Yes, I am kind of old fashion that way, reading a newspaper where you actually have to touch and turn a page, and move your head to read a story. In both papers, I saw several healthcare advertisements and a placed story.

Normally, one would probably would scan the ads or the story, make a fast determination of usefulness, and move on. Especially, if you don't need that particular service or clinical capability at the time. The placed story led with "A spa like atmosphere". Really.

But when looking at all the placements, I asked myself, what were the distinguishing differentiation characteristics, that separated everyone? What was the brand promise? What were the key messages? And most importantly, what, as a healthcare consumer, did you expect me to do?

Sadly, I could not find any clear and unambiguous differentiation.

This is not a challenge to be overcome, to be politically correct. It's a marketing problem. Period.

And it goes on in markets all across the U.S.A. on a daily basis.

What it reflects, is an old way of doing business. In a dynamic and rapidly changing healthcare market, where the consumer, is beginning to assert more control over the decision-making process, healthcare providers need to begin paying more attention to what they are, and are not saying. Just saying we provide quality care, have the best physicians, treat you with the latest high-tech toys, or provide an exclusive hotel-like experience doesn't work.

Those messages do not differentiate you. Everybody is saying the same thing.

The healthcare consumer of today, is looking for meaningful information upon which to make a reasonable and rational decision.

They are looking for answers to such questions as:

Why should I choose you?

What makes your doctors different, from the physicians in the other hospital, office or clinic down the street, who by the way, practice medicine in your hospital, and as your physicians do, admit to that hospital too?

How are your high-tech diagnostic and treatment tools, so outstandingly different from the ones in other settings. How do they make an outcome difference?

Do you really think that I care that you have a "spa like setting", big screen HD TVs, or internet access and will use that information to make one of the most important decisions in my life?

There are no easy answers.

The answers do require, that healthcare leadership and many marketing departments, begin to admit, and recognize, that the old way of healthcare marketing doesn't work anymore. Your brand messaging and advertisements, direct mail, web site, social media efforts etc., will have to become clearer. Much more clear on the benefits of, and reasons for, choosing you. That means treating the new healthcare consumer not as an idiot, but as a partner in the decision-making process. It means becoming transparent and open about outcomes. It means educating the healthcare consumer, about what the value is of an award is and what that award means to them.

It means changing attitudes toward, and practice of, marketing in your organization. Understanding that the old ways of healthcare marketing just don't work anymore.

To the major health system, that ran the cardiovascular ad in the Wall Street Journal, placing the Thompson Reuters Top 100 logo for excellence in that service-line, pay attention. The date on the logo of the award is 2008. It's 2011.

Since that award is bestowed annually and it's two years old, do you think that maybe the consumer, is asking what happened the last two years that you didn't receive the award?

Never let a consumer think of, or ask a question you don't want to answer.

Repeat after me: Brand. Price. Value. Differentiation.

You can continue the conversation with me on:

LinkedIn: http://www.linkedin.com/in/krivich0707

Twitter: http://www.twitter.com/mkrivich

Web site: http://www.themichaeljgroup.com

For more information, or to discuss your strategic healthcare marketing, customer experience management, marketing/sales integration or start-up needs, you can learn more at my web site the michael J group; email- michael@themichaeljgroup.com; or phone by calling me at 815-293-1471.

Are You Ready for Healthcare Price Competition?

The game is changing. Rapidly.

That's what I call Aetna's introduction to its members, of its easy-to-use, out-of-pocket payment estimator. Simple really, know the cost of a test, visit or procedure; know what it will cost you. But it doesn't stop there, it allows the healthcare consumer to compare the cost across multiple network providers. You can compare costs across 10 different hospitals and doctors.

WellPoint through its AIM subsidiary has shown where it was possible to incentivize physicians and plan members, to shop for radiology services and choose the lowest cost provider. It's reducing healthcare costs; while maintaining quality.

United HealthCare, though its Innovation Center , is empowering its clients and 70 million members across a broad array of data driven products and services, for the healthcare consumer to better understand their healthcare utilization, and make cost effective choices.

And these are just a couple of the price and cost decision-making information that the healthcare consumer is starting to receive. (I receive no remuneration from mentioning these three companies. As a matter fact, they didn't even know I did this.) How long do you think it will be, before everyone else plays follow- the-leader?

As I have written in the past, healthcare is rapidly changing from a provider-dominated and controlled model, to a consumer-dominated and controlled model. And these changes are further evidence of the change. Nothing like having higher out-of-pocket expenses, coupled with the ability to obtain pricing information, then combined with the ability to estimate your own costs, to get healthcare consumers to pay attention. Shopping for care.

Member co-pays and deductibles are rising. Healthcare consumers are facing the economic reality that they now have some "skin-in-the-game". Can you really think of any better way to control healthcare costs and introduce a level of price competition, by providing information which really up until now, was essentiality unattainable?

Forget the quality argument.

Just because you charge more doesn't mean you have higher quality. The healthcare consumer already assumes quality. And they assume that it is equal across multiple providers. Saying you have high quality when you are unable to differentiate yourself in the market, because you won't use outcomes data, is a claim that falls on deaf ears. It's a given. It's the business you are in.

Pricing begins to rear its head in the healthcare consumer's decision-making process. And when all other things are equal, in the mind of the consumers, price wins. Quality is assumed. Caring is assumed. It's what you do.

Your marketing needs to change. Now.

Most healthcare organizations that are consumer facing, have never really had to deal with the pricing equation on a competitive basis. For insurance, medical device, pharma and other suppliers to healthcare, price competition has been a requirement in their markets since the beginning of time.

Now, doctors, hospitals, and others will need to change their marketing operations and begin to deal on price. Your brand and brand reputation, takes on new meaning, when price and choice become a critical component in the healthcare consumer decision-making process. High price, undifferentiated quality, won't cut it anymore.

Competing on price vs. claims of quality, requires a different set of marketing skills than what you have traditionally found in most healthcare marketing operations. It requires more than a communications skill set, or senior leadership thinking that they know how to market. This is a game changer, and if marketing is not at the senior management table now and involved across the organization, then you are already in deeper trouble than you think.

Change is never easy. Eespecially old attitudes towards the value of, and need for, healthcare marketing. With an industry changing as rapidly as healthcare. With price competition now entering the equation. I prefer to think that a potential golden age of healthcare marketing is upon us. One where the old attitudes are going away. Highly trained, experienced and professional marketing people will take their place at the senior management table. And in the process, healthcare becomes more accountable to the consumer in ways never imagined.

Repeat after me: Brand, Price, Value.

Exciting times we live in. Game on.

You can continue the conversation with me on:

LinkedIn: http://www.linkedin.com/in/krivich0707

Twitter: http://www.twitter.com/mkrivich

Web site: http://www.themichaeljgroup.com/

For more information, or to discuss your strategic healthcare marketing, customer experience management, marketing/sales integration or start-up needs, you can learn more at my web site the michael J group; email- michael@themichaeljgroup.com; or phone by calling me at 815-293-1471.

Consumer Satisfaction in Healthcare Marketing

The dynamic has changed.

With the advent of HCAPHS and the Affordable Care Act (ACA) consumer satisfaction is no longer a nice too have but a got to have in healthcare. Difficult to achieve and tough to beat once you have it, consumer satisfaction with your medical services, regardless of the monikers we place on them, will drive volume and revenue. Revenue for the standpoint of Pay-for-Performance (P4P) programs and volume from consumers selecting you in a very "commoditized" and provider undifferentiated healthcare market place. As you create your networks, Accountable Care Organizations (ACOs), Medical Homes (MHs) and other yet undefined organizations, you have the opportunity to "get it right" this time.

For the past 10 years, I have been writing and working within healthcare organizations to improve satisfaction. Ten years ago, I had the opportunity to coauthor a book with Ralph Bell, PhD., on satisfaction entitled- How to Use Patient Satisfaction Data to Improve Healthcare Quality, American Quality Society, Quality Press www.asq.org/quality-press . This past weekend I received a notice that the publication run worldwide is 843 copies to date and counting. The books relevancy today is even more so than it was when first written given the changes in healthcare in the U. S.

The healthcare consumer of today will view your services as: value= f(cost, quality, satisfaction) as compared to the near past where value= f(cost, quality). Value here is the defining moment and is a function of cost, quality and satisfaction with you.

Marketing Implications

With the ACA and HCAPHS Hospital survey in play by reporting provider satisfaction as a common basis for measurement and consumer comparison, all the more imperative the focus on patient satisfaction. Healthcare is not an easy business by any stretch of the imagination. We work with people who are patients and their families that are at various states of emotional distress, caring employees (for the most part), good physicians etc. So satisfaction for so many different groups becomes interrelated.

Why is it important?

High levels of satisfaction are a powerful differentiators on your market, negotiations with insurance companies and your physicians.

Done correctly, your satisfaction program becomes the Voice of the Customer (VoC) to drive real organizational change.

It is a strategic and tactical edge for your brand and your marketing communication efforts.

Think customer evangelization.

Where does satisfaction start?

No surprise here - right in the executive suite. The CEO and senior leadership sets the tone, tenor and actions by what they do or don't do. How they treat others. How they measure and hold themselves accountable in the performance evaluation process. It's either part of the culture or not. People clearly trained, as well as understand the organizational rationale, policies, procedures for satisfaction and are part of the program, or they see it as the flavor of the day because so and so said so.

Satisfaction is a Process

Patient satisfaction is a process that is controllable and understandable. It is the voice of your customer. By listening to that voice, I mean really listening to that voice, you would be surprised at the improvements that you can make in your healthcare setting. Patients, physicians and others view the hospital experience not as a set of unrelated departments where things are done to me, but as a coordinated whole in a continuous process.

Where do we go from here?

It starts with learning. It starts with an honest assessment of here is where you are. It starts in the C-suite. Commitment, compassion, understanding, listening, process control and improvement.

The choice is yours. The marketing implications, strategies and tactics are clear. Lead or be left behind.

You can continue the conversation with me on:

LinkedIn: http://www.linkedin.com/in/krivich0707
Twitter: http://www.twitter.com/mkrivich

Michael Krivich is Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association and can be reached at michael@themichaeljgroup.com or 815-293-1471 for consulting services in strategic marketing, integration of sales and marketing, media relations and interim marketing executive leadership assignments. Huthwaite SPIN selling trained and a Miller Heiman Strategic Selling alumni, both highly respected and successful international sales training organizations , I can lead your organization though the challenge of integrating sales and marketing.

Marketing Accountable Care Organizations

Entering the new world of healthcare where quality and accountability are drivers to reduce cost, how do you market an Accountable Care Organization (ACO)? Especially as healthcare providers, namely doctors and hospitals, must compete on outcome transparency, quality and cost. A triple threat and uncharted territory. Outcomes data will be the driver and available to the consumer to make an informed choice. A monumental shift in the market place of who controls the information.

Anybody seen the new United Health commercials? They are already touting call us, we can send you to the best doctors. Anywhere in the country. Organizations that control the data, control the market and control the price.

So for those doctors and hospitals looking at ACOs, better get your track shoes on. The big insurers are already moving forward with physician groups and pilot programs to test the concept.

In the end, I believe that insurers will control ACOs by the simple fact that they have the data. They already know which doctors practice the best quality and most efficient medicine. The insurers already know which hospitals provide the most cost-effective and quality-driven care. All because they control the claims data. Insurers analyze, predict and can move much faster than others can. Stockholders demand it. So, while tax-exempt organizations engage in their annual lets build consensus before we can move forward on the idea, you are already late to the market and at a decided disadvantage.

Besides, I wonder if ACOs really pass the smell test of what Clinton tried to do in the1990s? And that failed. Maybe what we really have is the same attempt re-branded for 2010?

Marketing Accountable Care Organizations

Brand. Quality. Data transparency. Service. Price.

Your message needs to be clear and concise, echoing the ACOs brand promise and the value that you bring though your ACO to the consumer or the insurer. Focus on outcomes not high-tech or "touchy-feelly". Consumers are too sophisticated for such a simple message.

How you position your ACO vies a vie others is critical and you get one shot. You need to do it right. Remember, you can only take one of three positions in the market, superior, equivalent or inferior. The initial positioning of your brand is one of the most critical tasks you face. With an informed consumer bearing more of the cost, you have one shot to get it right. No do overs anymore.

Co-brand you member materials with insurers for members to educate and inform abut your ACO. Same with self-funded employers. Go to employers work site to reach employees.

Create a separate web site and social media strategy for the ACO and co-brand where possible, have everything online for patient education materials to forms and payment mechanisms.

Need an easy to read and understand dashboard that reports on quality measures for consumers, insurers and employers.

Commit to excellence in customer service and create a Voice of the Customer program to establish and maintain a continuous feedback loop with your key customers. This is not lip service; this is real change. Failure to do so will label you as inferior. Poor customer service is no longer acceptable.

Keep in constant communication with your members. Email is best. Use video emails and always , always have a call-to-action message.

Create a loyalty program. This is not a taboo and except for government program beneficiaries in Medicare and Medicaid or other government funded programs. You can create a loyalty program. Fact is not all patients are the same so you might as well take advantage of it before others do. It can be a powerful differentiators. Step out and be creative.

There is more you can do, but know this should keep you pretty busy.

More news:

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Michael Krivich is Fellow, American College of Healthcare Executives and a Professional Certified Marketer, American Marketing Association and can be reached at michael@themichaeljgroup.com or 815-293-1471 for consulting services in strategic marketing, media relations and interim marketing executive leadership assignments. Huthwaite SPIN selling trained and a Miller Heiman Strategic Selling alumni, both highly respected and successful international sales training organizations , I can lead your organization though the challenge of integrating sales and marketing.