Sunday, June 30, 2013

Can bundled care and pricing give you a marketing edge?

As the burgeoning healthcare consumer looks at you from a price, outcomes and experience perspective, it naturally follows, well at least for me anyway, to wonder if bundled care and the price certainty that goes along with it can give you a market edge.

I think it does and here’s why.
Even as healthcare reform kicks into high gear in 2014, there will be a cornucopia of diversity in the payment models in the healthcare market place, and you have to be ready for all of them.  Bundled care and its price certainty can go a long way to differentiate yourself in the market to the healthcare consumers not in an ACO, Medical Home, or narrow networks, and drive profitable market share and revenue to you. It could even make you more attractive in a narrow network of providers.  And I am pretty sure employers will like it too, especially those that are self-insured.

I get it that not all care can be neatly bundled into a healthcare consumer friendly package, but a lot of it can. And if you want to survive in a consumer-centric healthcare model, then that means you will have to meet healthcare consumers needs, not yours. That means price certainty, transparency in outcomes and experience.
Don’t believe me, then take a look at this short article Poll finds consumers like bundled care, Healthcare Payer News, April 17, 2013. Consumers like bundled care because of offers price certainty. It is transparent, easily understood and for the most part affordable, especially for the uninsured. There will still be a significant portion of the population who will not have insurance even under the ACA and the expanded Medicaid programs.

It is inevitable that one of your competitors in your market is going to come out with a bundle care programs for specific diagnosis’s and procedures.  When they do, they will have the healthcare consumer’s attention.  First one to the market place wins the perception battle with this, and moves the market away from the confusion of hospital price, and clarifies for the healthcare consumer their immediate choices.
As I have written before, the new market drivers for hospitals in an evolving consumer-centric market are price, outcomes and experience.  Bundled care can deliver on all three market dimensions.

Nobody said this was ever going to be easy.

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. 

Monday, June 24, 2013

What is your market position- superior, equivalent or inferior?


With the reformation of  healthcare in the U.S. about to hit full speed ahead, most healthcare providers will need to undertake a full detailed examination of their position in the market vies a vie their competitors.   A simple question really that is not so easily answered unless you're being honest, and are doing the market research.

Positioning is not a tactic. It is a strategy.

There are really only three positions you can have in a market, superior, equivalent or inferior. And just saying you have the newest hi-tech equipment, offer world-class care, revolve around the customer,  uild a new building, or produce a white paper does not, let me repeat, does not mean you hold a superior market position, or even a thought-leadership position for that matter.

If your market share has not changed much over the last few years, you’re not in a superior position. If revenue has not grown, but stayed steady, you are not in a superior position. If your products, solutions and services are haven't changed much, then you are not in a superior market position.

If customers keep asking you about what you are doing in an area, then you are in an inferior market position.  If your market segments can't tell the difference between you and someone else, you are in an equivalent position.

And when all things are equal, people buy on price.

And with all the potential families and individuals with health insurance becoming available, if you haven't established a superior market position, then an equivalent or inferior position gets you into a price war. In value-based and P4P payment programs, superior brings more revenue. An equivalent market position brings less; while inferior positions will penalize you.

So before you start marketing, you need to take a closer look at your market position, how you are positioning your healthcare organization and the market position you need to dominate and control. 

That is marketing strategy first. Tactics to get you to that position, second.

No more do-over's. You either position yourself correctly first and control the market, or it controls you.

Your choice superior, equivalent or inferior. Choose or it will be chosen 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

Saturday, June 15, 2013

Is Centers of Excellence marketing worthless without price, experience and outcomes data?


Just about everyone has some kind of healthcare Center of Excellence (CoE), and these programs are continually marketed by healthcare organizations. Mostly it’s marketing by screaming at the market place that you have a Center of Excellence. But, as healthcare moves to a patient-centered or consumer-centric market depending in what you believe, can hospitals continue to just claim having a Center of Excellence without price experience and outcomes data to support the claim?

I think that answer is no.

You can still say you have a Center of Excellence in an effort to grow share, revenue and for obtaining new payment agreements. But if that effort is not supported by price, experience and outcomes information for the healthcare consumer, then how do you prove to the newly minted healthcare insurance card carrying consumer in 2014, that your CoE is better than the one down the street?

The point here is that proud pronouncements on Centers of Excellence without transparency will become a thing of the past.

Marketing of a Center of Excellence in a value-based or risk-sharing environment takes on a very real purchaser focused approach. You will need to prove to all purchasers, be it government, insurance, healthcare consumer etc., of the value of your Center of Excellence along at least three dimensions, price, experience and outcome.

So to market successfully you need to:

1) Define your value proposition, and each value prop will be different based on the market segment.

2) Identify potential accrediting bodies for your Center of Excellence, and achieve same.

3) Or, in the absence of accrediting bodies, do the research, and set meaningful outcomes as benchmarks.

4) Decide what your marketing position is going to be. If it’s not superior, then what are you doing this? I mean really, who wants to go to a Center of Excellence that is perceived as market equivalent or inferior to your competitors?

5) Develop an outcome reporting mechanism tailored to your market segments.

6) Be price transparent as individuals are already shopping on price as it relates to out-of-pocket co-pays.

7) Communicate in terms people understand not about we do this, but in the value of the Center of Excellence to them, and how it meets their needs.

8) Develop and execute integrated marketing plans that are connected to the business, and financial plan of the Center of Excellence covering traditional, social, and media.

9) Remain consistent with your brand architecture for the healthcare organization.

10) Use employer, insurance, physician, and patient testimonials.

11) Constantly evaluate your marketing efforts, change when needed, and do what I call fail fast.

12) Prove Return on Marketing Investment (ROMI).

Marketing of Centers of Excellence in a shared-risk or value-based payment environment will be needed. It will go beyond the current messaging that so many are utilizing assuming build it, and they will come. Now build it incorrectly with same old marketing, and they will not come.

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.

Monday, June 10, 2013

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.

Sunday, June 2, 2013

Are you engaging the patient’s family and influencing their experience?


We all read and hear about patent engagement and experience, and what healthcare organizations think that means. But little discussion if any centers around how do you engage the patient’s family along the same lines? Regardless of what payment model-risk, value-based or bundled, full or partial capitation, in an ACO or Medical Home, the patient’s family will be involved.

So from a healthcare marketing standpoint as you develop your patient and healthcare consumer experience/engagement strategy, you need to address how you will engage the family too.

And for your understanding, when I write or speak about patient engagement, it’s a view along a continuum from first contact as a healthcare consumer through diagnosis, treatment, and post care. It is a far more encompassing view of engagement which heavily influences the experience that loops back to either reinforce positively or negative the level of engagement. And guess who is there at all times making comments, coloring observations and influencing the experience and engagement? You got it, the family.

And now that people will be paying more out of pocket, and are becoming price sensitive with all the new price data that’s available, family will be more important than ever. Especially if they may have a financial stake in the individuals care. Think a 25 year old receiving care under their parent’s insurance. Or the wife taking care of her ailing husband. Or the same sex couple.

They all need to be part of your engagement/experience strategy.

And it will be different for each and every patient and their family. Engagement/experience is not a one size fits all. Its mass customization applied on an individual level.

It really only gets more complicated trying to manage the engagement and experience of an individual who at some point depending on the dynamic could be in all three groups- consumer, patient and family. So now you need even more consistency and predictably in the engagement and experience process.

There is no doubt a long way to go on this road, and there are no easy answers. But this I do know, if you are not engaging and influencing the experience of the family, you will lose the healthcare consumer aka the patient. And in captained risk model, that’s a disaster waiting to happen.

On another note, my daughter is a left-handed pitcher on a 16U A level fastpitch softball travel team, and the travel season is now fully underway. So I will still be posting weekly, but maybe not with the same predictability and regularity of an every Sunday post, but it will happen weekly. Oh, and Alex won her first game of the travel season on 06/01/13, 9-3, with 5 Ks & 0 Walks. 

Now where is the suntan lotion?

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.