Why hospitals need to focus on patient relationship management

If a patient fell in the woods and nobody heard him, so what?

Most people are comfortable rallying around that approach.

I've spent a lot of time trying to understand what a patient is worth to a hospital. Apparently, no one has had this conversation before. If they have, the answer was sequestered.

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Patients are both customers and consumers. Unless the patient is in the back of an ambulance being driven to the nearest hospital, as I was, the patient can choose which hospital to purchase services from.

Choice. If I wish to purchase a healthcare procedure, how might I go about that?

The entire industry is being turned on its head and the only people who do not recognize it are those running the hospitals.

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Hospitals are being pressured by numerous external influencers whose future impact remains unknown--reform,ONC, payors, and pharma.

 

Hospitals replicate services rather than make themselves unique, sacrificing and outsourcing their low margin services to other organizations that quickly raise the profitability of those same services.

If I want to purchase a large HDMI flat-screen television I issue an RFP (Request for Proposal) to the market. I do not walk into Best Buy and see what they have to offer. I go to the web, input my purchasing criteria, and evaluate my options. Through social networking, I require vendors to submit a reply to me.

For some reason the large provider business model believes healthcare can treat people who research options before making a purchase as an anomaly, and that having the chief marketing officer authorize the installation of billboards touting their urology expertise will offset patients' ability to choose. Look at your numbers. Does that approach appear to be working?

Of course not.

Patients want to purchase healthcare the same way they want to purchase breakfast cereal. Patients want to control whatever they can.

When I had my heart attack eight years ago, I wasn't able to choose between hospitals. I could not tell the ambulance driver, "My insurance does not cover this hospital." I could not tell him, "I've heard good things about the cardiology department at hospital ABC."

After being treated, I did consumer research and decided to purchase cardio services from ABC. Hospital ABC (Penn) won my business. I buy all of my cardio services from them, and my decision had nothing to do with which organization was covered by my insurer.

The large provider business model is being disrupted. It is being disrupted by prospective patients--consumers of healthcare and customers.

When you have a few minutes, Google your name-brand hospital. You'll get thousands of responses. Almost all of them have been initiated by prospective and prior patients, and many of them will not convey a positive message.

The healthcare market is patient-driven. But, nothing the C-suite does gives credence to that point. Large providers fail to recognize the fact that patients choose, that patients issue RFPs. No hospitals take a business approach to maximizing the life time value of a patient. Yet the lifetime value of an individual patient is probably seven figures.

Instead, the business strategy of most hospitals is to replicate the business strategies of their competitors. I am being generous as few hospitals have business strategies. They have budgets because that is how their boards measure them. If the hospital next door buys a machine that goes "ping," hospitals feel the need to purchase the machine that goes "ping," even though it adds no value to their bottom line.

Here's the point. Patients are now managing your business. Each patient, or prospective patient, is an asset--not the MRI and not the machine that goes "ping." Each patient may be worth more than a million dollars.

Hospitals need to get beyond the magnificence of their own credentials. Prospective patients do not care about your marketing, your billboards. Patients and especially smart patients are narcissistic; they care about themselves, not how providers market their services.

There is one thing, and only one thing, about patient experience management that the C-suite needs to understand. Patients are learning to buy healthcare from the market. If you want them to buy from you, you'd better give them a reason to buy. Being like the hospital next door is not enough.

Paul Roemer is a healthcare strategist and the managing partner of Healthcare IT Strategy, which helps health care providers solve business problems using EHR, workflow improvement, and change management.

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