There is great debate over whether consumers shop for health care services; I mean compare prices and use performance and quality data to make decisions. A recent story about a man who drove five hours for hernia surgery because he discovered a cost difference of $30,000 versus $3,000 (see Man Drives Five Hours For Surgery Insurance Won’t Cover) and news that about 1.9 million Americans have become medical tourists to get cheaper care (see U.S. Medical Tourists Seek Cheap Health Care Abroad) make me believe we’re entering a new phase of health care consumerism.
While price transparency is a priority (see Presidential Order Requires Price Transparency For Hospital Charges And Out-Of-Pocket Expenses), there is controversy over mandates for transparency (see Executive Order on Improving Price And Quality Transparency in American Health Care To Put Patients First and Trump’s Push for Health-Cost Transparency Sparks Furor) and experts question why consumers are not really shopping (see Trying To Shop For Medical Care? Lots of Luck With That and The Skin in the Game Theory Hasn’t Panned Out) to get the best prices.
What’s causing the delay? One health care executive, quoted in a Los Angeles Times story, said, “We overestimated the ability of consumers to be good stewards of their health care dollars.”
I believe we need more time to see a real shift from a doctor-knows-best environment to one in which consumers, like the Texas man noted above, look at health care like other purchases.
There are a few trends we believe will support more active consumerism. First, employers like Walmart are taking action to steer employees to specific physicians in its markets based on quality data (see Walmart increasingly comparing physicians over cost: 5 things to know and Walmart Pilots Suite of New Medical Benefits Designed to Make it Easier for Associates to Identify High-Quality Physicians in Local Communities). And Walmart is not alone. An increasing number of employers and health plans are implementing strategies to influence consumer health choices with value-based benefit designs and decision support tools (see Trends in Behavioral Health: A Population Health Manager’s Reference Guide on the U.S. Behavioral Health Financing and Delivery System).
The Center for Medicare & Medicaid Services (CMS) has several new initiatives that are focused on engaging consumers in health care decisions. CMS implemented a new rating system for nursing homes this month, Nursing Home Compare (try out the tool: https://www.medicare.gov/nursinghomecompare/search.html). And starting October 23, CMS will add a graphic alert to listings for nursing homes cited for abuse, neglect or exploitation (see CMS To Enhance Transparency About Abuse & Neglect For Nursing Home Residents, Families & Caregivers).
CMS is also requiring health plans to use its star ratings, which are influenced by consumer satisfaction, on health insurance exchanges (see CMS Requiring Star Ratings Displayed For Health Plans Sold On 2020 Health Exchanges). And it’s planning to update and expand the Hospital Compare site in 2021 based on public hearings and other stakeholder input (see CMS Announces Upcoming Enhancement of Overall Hospital Quality Star Ratings).
When you combine these efforts with existing NCQA, HEDIS and health plan efforts to highlight health provider performance ratings, consumers will have more information at their fingertips. We see evidence that out-of-pocket costs will increasingly influence consumer choice (see News Reports about a Weakening Economy Impacting How Some Patients Seek Medical Treatment) and lead them to use these tools. The bigger question is how do we teach consumers how to use this information the same way they use Rotten Tomatoes to assess movie choices and Yelp when looking for restaurants?
“We are moving quickly toward Priceline health care,” said OPEN MINDS Senior Associate Paul Duck. As consumers gain a better understanding of their options, shopping will become more common, which is why he advises executives to prepare. A few approaches to consider:
- Review your organization’s ratings from health plans and independent organizations (see Succeeding In The Online Ratings Game).
- Assess how consumers find you online (see Making Sure Consumers And Referral Sources Can Find You Online).
- Review the consumer experience on your website.
- Assess wait times for consumers scheduling appointments on the phone.
Learn more in upcoming coverage of the consumerism issue and check out these resources in the OPEN MINDS Industry Library:
- The Next Wave Of Consumer Price Shopping For Health Care
- Considering Cash & Consumerism in Service Line Planning
- Integration, Interoperability & Consumer Engagement
- CMS Bulletin on Display Of Quality Rating System Star Ratings & Qualified Health Plan Enrollee Survey Results For QHPs Offered Through Exchanges).
- What Do Your Consumers Want?
- Make Change Or Be Changed
- The Big Rewards Of Health Care Through The Consumer Lens
- Customer Service, Consumer Experience & Consumer Engagement: Keys To Competitive Advantage
- Let Consumerism Guide Your Customer Service Efforts
- Answering The Question – Who Can Afford Their Health Services?
For more on how to position your organization, join OPEN MINDS Senior Associates Tim Snyder and Rob Hickernell October 29 for the “Finding The Path To Online Marketing Success: An OPEN MINDS Executive Seminar On Best Practices In Website & Social Media Marketing” during the 2019 OPEN MINDS Technology & Informatics Institute in Philadelphia.