For years, the idea of consumerism in health care has been fodder for discussion among pundits. Often spoken about in aspirational tones, the idea that health care could reinvent itself to focus on customer-friendly practices has often seemed like wishful thinking. But, spurred by the recent dramatic rise in digital health innovations and adoption of new technologies during the Covid-19 pandemic, a more patient-centered health care system is closer to a reality.
During a Nashville Health Care hosted discussion on “Consumerism in Health Care” this topic was explored in-depth and many interesting points were shared. Panelists included Richard Ashworth, president and CEO, Tivity Health and Marcus Osborne, former senior vice president, health transformation, Walmart. Marcus Whitney, founding partner, Jumpstart Health Investors moderated the discussion.
Retail vs. Health Care: Two Different Perspectives
Health care is different from other industries in many ways, and one of the most prominent differences is the way payments are made. As opposed to going to a retail store, shopping and paying for an item immediately, consumers in health care have no such clarity. They rarely pay directly for a health care good or service. Instead, third party payers play a central role in the dynamics of health care transactions. However, the panelists contend that this is not a good excuse for the lack of consumer consideration in health care.
“At the end of the day, the health care system is serving consumers, so ideally it should be no different than retail,” said Osborne, who served as a leader in Walmart’s health and wellness division for nearly 15 years, until he left the company earlier this year. “Traditionally, the health care industry’s approach has been to create solutions that consider all the players’ needs equally – providers, payers, employers, pharmaceutical companies and consumers. However, this creates solutions that just don’t work for consumers and frankly don’t really work for providers, payers or the rest as well. The design imperative needs to be consumer focused to truly create an efficient system.”
Moments of Truth
The retail industry relies on consumer data to determine business decisions. Customer satisfaction, net promoter scores and interaction effectiveness are studied intricately to determine best practices and strategies. Ashworth, who spent almost 30 years in leadership roles at Walgreens before taking the helm at Tivity Health, pointed out that this is a primary guide for retailers’ operations.
“In retail, we are concerned with ‘moments of truth’—the interactions that matter to the customer,” he said. “For example, we know that in a pharmacy, a delay of service is not necessarily a problem, but a delayed acknowledgement of the customer creates anger and frustration. We also know that when prescriptions change, that is a sensitive moment that needs more attention. Retailers know these moments of truth – what makes customers walk away satisfied or not. If you don’t know your moments of truth in your business, you are not putting your resources in the right place.”
Osborne agreed with this sentiment, emphasizing, “When there is a positive experience, customers just want it to happen again. If there is a bad experience, customers will stop coming to the store or using the service or product. This is especially important to consider in health care, when adherence can have a major effect on someone’s health and wellbeing.”
The Paradox of Innovation
There is no shortage of new promising health care technology companies, or investors willing to fund them. According to Rock Health, 2021’s total funding among US-based digital health startups amounted to $29.1B across 729 deals, with an average deal size of $39.9M. This era is comparative to the rise of the tech industry in the 1990s, when the market was crowded with new innovative companies, all competing to come out on top.
“On one hand, there are so many innovators transforming the system and that’s great. But on the other hand, people are overwhelmed by options. The same thing happened in the 1990s until you saw the rise of the integrators – companies like Google and Amazon – that weren’t the first to create a solution but focused on making a solution more effective for consumer engagement. That’s where we are now. We need companies to take ideas we know that we need and make them the most effective in the marketplace,” Osborne said.
Ashworth added, “We’re in a transition time and the game is still to be played out. Optum, Walmart, Walgreens – all of these companies have the potential to emerge as the leader, but I think we’re still early. There is no clear frontrunner.”
According to the World Health Organization, the pandemic highlighted the need for innovative health technologies to deliver care in areas that lack infrastructure and resources. However, many of the new technologies that have come to market are still unaffordable or unsuitable for low- and middle-income populations.
The panelists pointed out that these challenges should be considered if we are to move toward a more patient-focused delivery system.
“Today we leave a lot of people behind, often the ones that need quality care the most,” said Ashworth. “Twenty percent of the population can’t afford or don’t have access to broadband service, so they have no access to these digital innovations. There is an important opportunity to work together in private-public partnerships to create more equality. We can’t do it alone, but together we can make it work and improve healthcare for everyone.”
The Council’s “Consumerism in Health Care” event was sponsored by Ardent Health Services. For more information on upcoming events visit us at https://healthcarecouncil.com/.