Health Care Takes a Page From the Customer Loyalty Playbook
Consumer expectations of how health care should work are increasingly shaped by other industries. Competition is fierce, driving businesses to continuously look for the right combination of value, service and incentives needed to acquire and retain customers.
Facing similar competitive pressures, health systems are experimenting with some of the same tactics that other industries have been using for years. In this post we’ll look at loyalty and rewards programs, and how health systems are using them to drive key objectives.
But first let’s take a look at a 2015 Advisory Board Company survey with some surprising results that reveal what’s important (or unimportant) to consumers when it comes to loyalty to their primary care physicians (PCPs).
What’s Important to Consumers?
Only 9 percent or respondents said they would defintely follow their PCP to another practice or clinic
The #1 reason respondents would switch PCPs is if they no longer accept their insurance
52 percent of respondents would switch if they had to pay $250 more to keep their current PCP
Negative online reviews of physicians are more influential than a friend or relative’s bad experience with a physician
The #1 attribute of a new competitor that would make respondents switch is if the new PCP guarantees that they will be seen within 15 minutes of the appointment time
Differences Between Provider and Patient Values
Hospital marketers have traditionally focused on what they have to offer – the latest technology, the best providers, the highest quality scores. But patients may judge them based on non-clinical aspects of care – amenities such as good food, ease of parking, attentiveness of staff – even how comfortable the sheets are. “Patient preferences about where they receive care seem to turn on creature comforts and amenities,” says John Romley, a health economist at the University of Southern California rather than on health care related measures such as complication or infection rates. (Kaiser Health News
Why Is Loyalty Important to Health Systems?
Hospitals and health systems are competing for patients, whether they are focused on driving service line volume and fee-for-service revenue, or on prevention and managing costs in accountable care organizations.
An ACO, for example, might assume responsibility for a patient population, but if patients seek care out of network, the ACO is still on the hook for the costs incurred. If coordinated care is the essential prerequisite for better outcomes and lower costs, how are patients aligned and incentivized to work with their care team and stay within the ACO? Beyond that, how are they rewarded for taking better care of their health and reducing the need for care in the first place?
A Costly Oversight?
A recent editorial in JAMA titled Health System Loyalty Programs
states: “Health systems have done little to focus on patient loyalty or reward programs. In an era of accountable care organizations (ACOs) in which patients are free to move between clinicians and health care centers, this may prove a costly oversight, as evidence demonstrates that attrition of patients within ACOs is common.” The authors report that of nearly half a million patients enrolled in the Pioneer ACO program, 62 percent remained in the same ACO at the end of the year – a 38 percent turnover rate.
Examples of Loyalty Programs
A small number of organizations are figuring out what behaviors they need to drive and are structuring loyalty programs around them. Here are a couple of examples:
Primary Health Network in Ohio and Pennsylvania is giving reward points to patients who show up for primary care, dental and gynecological appointments. The points are redeemable for merchandise. (ModernHealthcare)
Baystate Health in Massachusetts has a free “Spirit of Women” membership program offering educational programs, discounts and special offers related to women’s health.
A central goal of the Affordable Care Act is alignment of provider organizations toward value vs. volume, and creation of a sustainable future for health care. To achieve this, the entire payment structure of health care is being revamped with a focus on quality, cost and outcomes. The missing link might be aligning incentives for patients. By understanding what is important to patients, provider organizations may be better able to structure incentives that reward patients for staying healthy through collaborative and coordinated care.
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