How are you retaining and engaging the healthcare consumer?

The financial stakes have never been higher as healthcare change steamrolls along. There is the growing and choice confident healthcare consumer demanding price and quality data. Reimbursement declines in Medicare and Medicaid continue unabated. Then there is the shift from fee-for-service to risk-based payments and new care models appearing nearly every day resulting in inpatient utilization declines.

And all of this has the greatest effect on how an organization engages and retains in network the healthcare consumer across a wide variety of touch–points, encounters and channels.

You know the old adage, it costs five times as much to find a new customer than to keep an existing one. 

It is truly a new day in healthcare.  Patients are becoming highly informed consumers making purchase decisions based on price and at some point will be utilizing quality data in that process.    

So what does that mean for the healthcare provider?  Without strong healthcare consumer engagement and retention strategies, the financial ramifications of losing the healthcare consumer to other providers and seeking care outside of the network can be ruinous.

This means that one needs to understand the healthcare consumer as never before, anticipating their needs by being proactive in establishing a meaningful relationship with a consistent stream of two-way communication.

It is an opportunity to reinforce your key brand promise and messages.

It's an opportunity to create customer evangelists for your healthcare organization, which through word-of-mouth marketing will bring additional healthcare consumers and revenue.

Here are five items one should consider for proactively retaining and engaging the healthcare consumer:

1.) Transparency and Quality dashboards.  This is about improving care, using best practices, learning and improving as a system to the individual level by engaging the patient.  A provider must be prepared to provide individual level utilization and quality patient reports, to engage the person in a meaningful way to create change in health behaviors, and foster appropriate utilization of services in the right setting.

2.) Voice of the Customer (VoC) program.  One has to be in constant contact and monitoring member attitudes, beliefs and reactions.  It's all part of the patient experience program and process. Engagement and retention strategies are all based upon the needs of the healthcare consumer, not the organization.

3.) Understanding the ongoing customer experience management program and process.  This isn't just about delivering an exceptional customer service at the point of care. You must identify all customer touch-points, from beginning contact to end point, and manage that experience across all of those touch-points. 

  

4.)  Developing comprehensive member communications that are transparent, meaningful and drive engagement customized to the individual level. This is really ongoing communications beyond health and wellness tips. They must also be delivered the way that the member wants them, be it on an Ipad, member web portal, email, hard copy, direct mail, telephonic etc.  One size does not fit all.

5.) Engaging the healthcare consumer through social media. Social media methods in engaging and retaining the healthcare consumer as a customer are nearly immediate and regardless of age group or demographic characteristic are growing exponentially.  Failure to include the social media channel in the organizational engagement and retention strategy is well, inexcusable.

With so much on the plate of healthcare leadership in trying to survive, healthcare consumer retention and engagement can appear at the bottom of the list. Going forward in the brave new world of healthcare consumerism, it’s one of the new critical essential business mandates whether one realizes it or not. To engage and retain is to survive and grow.

Happy Birthday to Healthcare Marketing Matters! On February 17, 2007, I started writing Healthcare Marketing Matters blog, and it hardly seems like HMM should be seven years old. But it is with hundreds of post and tens  of thousands of page views, here’s to the next seven years.  Thank you for reading, commenting and working so hard day-in and day-out to make healthcare marketing more strategic and visionary.  

How is healthcare consumerism changing provider marketing?

Technological and care delivery innovations, specialty pharmaceuticals, social media influences, data releases on price and quality, the healthcare consumer sending more out-of-pocket and exhibiting consumeristic behaviors in insurance choices and provider section, have come together to create the perfect storm.

How has this affected healthcare provider marketing?

It's a tough balancing act when an organization has never really marketed in an evolving semi-retail healthcare market, or communicated with the healthcare consumer in meaningful price and quality terms. Terms that grow your brand, build stronger customer connections and answers the question, what's in it for them?

So why should this be on leadership’s radar screen, as if there isn’t enough to worry about already?

I can give you five reasons why:

1. Retail medicine; 2. Price competition; 3. Newly Insured; 4.Consumer choice; 5. Social media.

These five market shifts are changing how healthcare organizations will do business. And if healthcare marketing is not changing, then what follows are the critical steps you need to take to leverage and move ahead to survive and thrive in an increasingly tough market.  

1. Market Research

Do the research on healthcare consumer behavior, what motivates them, how to communicate with them, how they make purchase decisions and price points they are willing to accept. Healthcare consumerism screams for market research. It's about the healthcare consumer, their needs, expectations, experience and engagement.  And thinking you know about them is not the same as having the quantitative date that knows them.

2. Business Savvy

Make the healthcare marketing department business savvy. Out with the marketing communications focus, and in with a data driven ROI marketing coupled with an understanding of finance, project management, and operations so that the marketing can be transformational. Going from saying "we care and provide world-class care" to building brand, engagement and experience as well as measuring that change in real terms requires a deep understanding  of the organization on many levels in order to be successful in the market.

3. Resource Commitment

Healthcare providers must resource marketing appropriately in capital and human terms in order to compete with retail medicine and pricing competition. Engage the healthcare consumer in a meaningful way and improve their experience. Build your brand and increase awareness. Presence builds preference. It cost money to accomplish market growth.

4. Agility

Be nimble. Be agile. Be quick.  Keep repeating that over and over again. Healthcare marketing needs to move from the tried and true to the exceptional, the innovative, the engaged and the motivational. One can't reach the healthcare consumer on an emotional level to make the right choices, treatment, lifestyle and purchase decisions in your favor unless you are sufficiently engaged.

5. Integration

Integrate your marketing plans deeply within the organization. The healthcare consumer is at the center of all that you do. Pay special attention to social media. Social media is not a billboard but an efficient and effective engagement strategy that enhances all the other marketing channels you use.

6. The multiplicity of markets and patient mechanisms

Not everyone will be in an ACO or a patient medical home. Not everyone will have employer sponsored insurance. Some won't have health insurance of any kind. Not everyone will be in expanded Medicaid programs.  Small business may decrease employee’s hours to not have provided health insurance.  Large employers are creating private HIXs and moving to defined contribution. Baby Boomers are demanding a healthcare experience the way they want. And retail medicine is here to stay and will expand.

That light at the end of the tunnel is healthcare consumerism and that Walgreens ACO has come to a location near you.

Can 2014 be the year of healthcare marketing ROI?

With the start of the Chinese New Year and it’s the Year of the Horse, why not make 2014 the year of healthcare marketing ROI? As we all face increasingly reduced marketing resources both human and capital in hospital, health systems and other providers, the only way I know to even begin to turn that around is by proving to the organization the Marketing Return on Investment or ROMI.

It’s not the impossible task. And it does involve a high degree of collaboration with the finance department.

Depending on the type of health care organization that one is employed by the measures will be different. For example, if the healthcare organization is sales drive, then measure the generation of Marketing Qualified Leads, Sales Accepted Leads, and based on that increases in the long and short term funnel compared to YOY. Any organization using email can measure click through rate, open rate, unsubscribed rates, open rate and downloads. For hospitals and health system if you have the right systems then you can pull integrated clinical and financial databases by campaign to calculate the ROMI.

Below is an example of an actual computation that I completed for a multi-hospital health system. Now that being said, I did have the good fortune to have an RN staffed call center which was used heavily in all campaigns.  And because the call center and finance systems were linked, once you have that name then you can track and determine the customer value, revenues generated and a return on investment ratio.

The method can be adapted to any campaign and provides you with the data fields and logical analysis you need.  This is not prohibited under HIPPA, so that is not a reason to say no can’t.

An analysis was undertaken to look at the ROMI of the Physician Referral Call Center. The analysis matched a database of call center name records for the period to financial records which had already been downloaded.  The analysis produced the following results:

      9,102 call records were matched with utilization and financial data.

      9,102 calls resulted in a total of 9,121 encounters in the ER, Inpatient and Outpatient categories of service.

      751 encounters were ER

o   177 returning encounters

o   573 first time encounters

      1,105 encounters were Inpatient

o    530 returning encounters

o    699 first time encounters

      7,267 were Outpatient

o   2,014 returning encounters

o   5,253 first time encounters

      Total charges for all encounters equaled $22,522,649

      Charges for new encounters all services totaled $16,085,198 or 71 percent of the total charges

      Average charge per ER encounter  $1,304

      Average charge per  Inpatient encounter $13,581

      Average charge per Outpatient encounter  $903

      Gallup measures loyalty at 68 percent (would return for service) which means that for every 100 patients 32 would not return for care- therefore:

o   ED- 57 returning encounters captured that would not have returned

o   Inpatient – 170 returning encounters captured that would not have returned

o   Outpatient- 645 returning encounters captured that would not have returned

      Incremental charges counted returning encounters not loyal

o   ER - $74,337

o   Inpatient- $2,308,851

o   Outpatient-  $582,505

o   Subtotal charges counted:  $2,965,693

      Overall market share in primary and secondary service area is 14.53 percent. The number of first time encounters have utilized us above market presence is therefore:

o   ER 573 first time encounters,  83 not countered, 490 counted –

o   Inpatient – 699 first time encounters, 101 not counted,  598 counted

o   Outpatient – 5,253 first time encounters, 763 encounters not counted, 4,490 counted

      Based on an overall market share of  14.5  percent the  incremental charges counted for new  encounters not because of market presence:

o   ER - $638,960

o   Inpatient – $8,121,438

o   Outpatient –  $4,054,470

      Total Charges counted: $12,814,868

      Discount from gross charges for Medicare, Medicaid, Managed Care, Bad Debt and Charity Care @ 65% is $8,326,644

      Net Revenue:  $4,488,224

      PRCC program costs:  $233,410

      Net contribution:  $4,254,814

      ROI 18.22:1

Let’s make 2104 the year of return on marketing investment in healthcare.

How can healthcare marketing become a blue ocean strategy?

Simply put, a healthcare blue ocean marketing strategy is one where you redefine a market and dominate. By finding your blue ocean marketing strategy one can leap ahead of competitor's swimming in a blue ocean free of competition, instead of swimming in the bloody red ocean of undifferentiated services.

With healthcare moving to a semi-retail model where experience, price and quality transparency weigh heavily on the healthcare consumer with a  higher economic stake in care decisions, a healthcare provider at this time anyway, has the opportunity to break the mold and innovate along these dimensions and clearly differentiate in the market.

So how does this apply to healthcare marketing?

Healthcare is undifferentiated and for all practical purposes may be in danger of becoming a commodity where purchase decisions are made based on price, in this case the healthcare consumer’s out-of-pocket expense.  Hospitals, health systems, physicians and other providers have similar programs and services, have the same managed care contracts, share physicians etc., etc., etc, across multiple competitors. 

In an environment of multiple payments methods adding to the confusion from being paid for the production of care with the “heads-in-the-beds” to keep the healthcare consumer out of the hospital in the least expensive care setting, a blue ocean marketing strategy based on experience, price and quality transparency is just what the doctor ordered. Pun intended.

Now that being said, it is a tall order for an industry that has traditionally not been transparent regarding price and outcomes to make that change overnight.  But it is one of the few remaining changes that can provide a good head start on market dominance.  And in all honesty, whether or not survival is at stake, healthcare organizations need marketing innovation to change the competitive dynamics of the market.

The semi-retailization of healthcare is accelerating even more so now with the entrant of non-traditional providers who are competing on price, experience and access, which is a deadly combination for traditional healthcare providers who are slow to change.

Just because an organization packages the mouse trap differently than others, doesn’t mean it’s any different.

Developing what I call a blue ocean marketing strategy in truth stems from becoming a blue ocean strategy organization. Marketing leadership and marketing organizational transformation at its best and you have a formula for success. Be the blue ocean innovator and show healthcare marketing as proactive rather than reactive.

As the Disney character Dory in Finding Nemo says, “Keep swimming, keep swimming, keep swimming.”

I am a healthcare consumer. Do you know what I need?

I am a healthcare consumer and spending more out of pocket than I ever have in the history of healthcare.  I see the data on price and wonder why it’s so different when you won’t tell me why? I have seen the quality data but wonder if I will get sick from a hospital acquired infection, have an accident or get the wrong medications?

I am a healthcare consumer and see the nice advertisements and billboards for the hospital or health system with shinny trophies and award logos, but I don’t know what that means. The hospital or health system claims world class care but how do I know that is really true? I see what people are saying about the hospital or health system in social media circles.

I am the healthcare consumer who is newly insured because my employer sent me to the marketplace to buy my own insurance, or my policy was canceled due to ACA. I am the healthcare consumer who never had insurance before so why should I use you?

I am the healthcare consumer.

I read an interesting article published by Healthcare Finance News, Healthcare 2.0: Patient as consumers the other day and it caused me to pause by catching my attention. Then I started thinking what does that mean for healthcare marketing?

As healthcare evolves to a semi-retail environment difficult choices and decisions by hospitals and health systems are on the horizon.  And hiding behind the “we’re healthcare and we are different” won’t make those choices and decisions go away.

Granted, healthcare will never be a fully consumer driven market in the traditional sense. Some healthcare treatments, screenings etc., are needed by patients because they just don’t know about those services but that doesn't mean decision-making any longer without consumer market research.

Healthcare providers need a deep understanding of who the healthcare consumer is, what their needs are both perceived and unmet.  Now that being said there will always be services that need to be offered, but if you are communicating with a 25 year old, should you really be taking to them about colon cancer screenings or the dangers of drug and alcohol abuse?

This market dynamic is really transformational. Market research to achieve a deep understanding of who the healthcare consumer across all you market segments is needed like never before. That includes a voice of the customer program as well. And marketing needs to be at the table in this discussion and playing an active role. It is no longer I think this is the right way because the Board, doctor’s, senior management or the clinician’s had an idea. It’s now I know this the right decision in program design, communication messages and market approach because it’s based on facts.

And these are topics I have been writing about for the past several years now.

I am the healthcare consumer. Now what are you trying to sell me?

Is healthcare ready for native advertising?

The other day while trolling around the internet in the world of healthcare, I came across an interesting social media infographic: 41 percent of patients say social media affects hospital choice courtesy of healthcarecommunicatons.com.  I thought that factoid was pretty interesting.  Then I started thinking about the connection of this factoid to native advertising.

If you not familiar with the term “native advertising”, the simplest way to explain the concept is that it’s online advertising that seeks to gain attention by providing content in the context of the social media or online user’s experience. Native advertisement fits the form and function of the user’s experience in which it is placed.

Now given that 41 percent of people are using social media to choose a hospital and that number will grow over time, native advertising offers healthcare providers a large target audience rich environment to reach with relevant brand content woven into the context of the user experience. I am assuming of course in this statement that social media utilization by healthcare marketers is becoming more diversified, creative, and contextually appropriate to their brand.

That assumption may be debatable, but if a healthcare provider is ignoring social media and using the medium solely as a billboard for the warm fuzzy quality and we’re the best messaging when the market is evolving to a semi-retail model based on price and quality, well, they are missing an opportunity to build brand and revenue.

But I digress. So what does native adverting look like? Let’s start with what it is not.

Native advertising is not advertorial advertising. It is not an ad box. It is not automated.

Now let’s look at what native advertising is. Native advertising integrates high quality content in the user experience. It is delivered in stream and does not interrupt the user experience but adds to that experience. It is selective, remaining true to the brand in the context of the user experience.

If you are looking for examples of native adverting take a look at Facebook, The Washington Post, and the NY Times.  Oh and I would suggest that you hire an agency. Native advertising is not easy and is the next big wave in 2014 to come crashing down on under-resourced healthcare provider marketing departments.

You will need to do the market research to understand the social media habits of the particular healthcare audience segment in your marketing plan. One will need to segment the social media native advertising efforts because one size does not fit all. The content that is developed may fit in and work well on Facebook, but not on Google+ or LinkedIn as an example.

It should be remembered that native advertising should be used in an integrated fashion within the marketing mix of the organizational efforts with direct mail, trade shows, programs, thought leadership, advertisements, public relations etc.

Native advertising offers the healthcare provider the opportunity to standout within the context of the use experience.  And when so much time and attention is given to the healthcare consumers experience, shouldn’t that be extended to the advertising experience as well?

I leave it up to you to decide if healthcare provider's are ready for native advertising.

Why not engage the healthcare consumer with email?

Email marketing on the consumer side is a staple of any B2C marketing operation. Email marketing can be an effective way to engage the healthcare consumer, enhance the experience and build brand preference.  It also provides a mechanism for continuous content presence to build/enhance relationships, as well as being one of the more cost effective marketing channels available for communication. In the semi-retail environment of healthcare with information flowing to the healthcare consumer along price, choice and outcomes, market presence is everything.

Gone are the days when someone uses your healthcare organization, walks out the door and they never hear from you again until they initiate the next medical encounter.  In between medical encounters, email marketing can keep you engaged with the healthcare consumer. And isn’t that what engagement is all about, a continuous method of communication that focuses on the needs of the healthcare consumer aka the patient and not just a response to an episode of care?

The topics are virtually limitless and can be tailored to meet the specific needs of an individual or group of individuals.  From diet and exercise tips, to medication adherence, wellness programs, clinical service offerings, appointment reminders, test follow ups, etc, email marketing can help to engage and enhance the experience with the healthcare provider or practitioner.  What you choose to communicate is really only limited by the market research you need to accomplish to understand the needs of your audience to respond accordingly with the right engagement information at the right time.

There is some resource investment capital and human, but it will pay dividends in the long run. Email marketing is driven by data and analysis of that data. Sending an email is an activity.  It’s the outcome of those activities- open rates, unique visitors, unsubscribed, click though rates, calls in response etc., that is important to measure and track for a variety of reasons.

Beyond the obvious of needing to collect patients email addresses, you will need a email marketing automation system such as Eloqua, Marketo, Constant Contact  or one of the many other fine systems in the marketplace. These type of systems will assist you in meeting the can spam law requirements as well. This isn’t collecting some email addresses, make a distribution list and send from Outlook type of program. It’s about meaningful content that speaks to and engages the individual in a very personalized way. Part of that is driven by market research and A B testing of your message to learn what works and what doesn't. This is moving the organization forward in a new environment where the consumer is king and cost is everything.

Email marketing pre and post healthcare experience is an acceptable and desirable method to engage the healthcare consumer, build a relationship, strengthen your brand and maintain a continuous market presence.