Metrics for Success: Healthcare Consumerism
1
is article is the nd in a new series looking at components, characteristics, and new met- rics for hospitals and health systems in . In his best-selling book, e World Is Flat, omas Friedman pointed out that most industries are becoming increas- ingly global in scope. It doesn’t matter much where a company is founded or headquartered; its jobs are moving to the country that oers the best value—the best combination of quality and cost. It doesn’t matter much where you live; the products you buy at your local store come from all over the world. Healthcare isn’t at (at least not yet), but it’s getting atter in the U.S. and it is likely to get atter internationally. As uncertain as we surely are, we must prepare for a new consumerism journey, in which providers are competing for business both within the U.S. as well as globally. Healthcare Consumerism 2.0 In , it was reported that Bumrungrad International Hospital oered world-class healthcare in the heart of ailand. U.S. News & World Report featured the hospital on its cover, highlighting its JCI accreditation, internationally trained clinicians, and Amer- ican management as well as its low cost. Minutes also covered the story, reporting that the cost, including travel expenses and a vacation on the side, was less than the cost of comparable care in the U.S. When the aftershocks subsided, U.S. healthcare providers breathed a collective sigh of relief, and then quickly returned to business as usual. Almost no one made seri- ous preparations for global competition. A lot has changed since but, for the most part, everything remains the same. Consumers have online access to Web sites that oer comparative provider informa- tion. Online information may be qualita- tive or quantitative, outcomes-based, or focused on process. Much of it is not yet at the level it needs to be in order to be a signicant driver of choice. Consumers continue to select providers based on prox- imity, physician referral, and perception. Consumer behavior will slowly but inexorably change as the integrity of com- parative information improves, insurance companies exert inuence, and patients assume responsibility for a greater share of the tab. Aside from Medicare and Medicaid, percent of health insurance in the U.S. is still employer-based, and high-deductible plans are quickly penetrating the market, just as they are dominating policy pur- chases made on healthcare exchanges. e -year-old suering shoulder pain from her tennis serve now has options: shell out thousands of dollars to get her shoulder scoped, or take Advil and apply ice while hanging onto the cash. We can’t predict what she’ll choose, but we do know she’ll consider the options more carefully than she would have if the deductible was, say, . Is this same -year-old ready to y to ailand for her shoulder procedure? Today, it might seem unlikely. But a decade from now, when she has useable informa- tion on cost and quality, ailand may become a perfectly reasonable choice. More importantly, as cost information within the U.S. becomes better and easier to understand, and as health insurance marketplaces increasingly cross state lines, consumers will have more choices for domestic care destinations. Preparing for Consumerism 3.0 e globalization of healthcare is still a long way o, but the time to prepare is now. ese are some steps healthcare leaders can take to prepare for a consumer-driven marketplace in the next decade: • Directors, executives, and physicians must be diligent in focusing their organizations on quality, satisfaction, and eciency outcomes. Structures, pro- cesses, and metrics to achieve these outcomes are paramount, and the focus of great governance. • Board members must demand accurate, comparative board-level scorecards measuring quality, satisfaction, eciency, and other outcomes. e key is to start small with a few indicators that everyone understands, and increase complexity and sophistication over time. e U.S. cannot compete with the rest of the world on cost, but some patients will feel more comfortable staying within the U.S. for quality care, something the U.S. can compete on. us, the consumer-driven marketplace will have implications for competition (on quality and cost) both within and outside of the U.S. e role of leaders is to assist patients in accessing the highest-quality, lowest-cost care, wherever it exists in the world. U.S. consumers are clearly confused and frustrated when they attempt to discover which provider actually achieves the best outcomes for the procedure they require. e data is often wrong and, at best, dif- cult to analyze on a comparative basis. Leaders should instruct their marketing and public relations departments to com- municate with their patients on a level they can understand. Now is the time to start preparing for a marketplace that crosses national bound- aries. Fortunately, the strategies that will help U.S. providers compete globally will also help them achieve better outcomes at a lower cost to compete locally, regionally, and nationally. Boards need to be relentless in demanding improvements in perfor- mance if their organizations are going to be global players a decade from now. ~ e Governance Institute thanks Don Seymour, executive vice president with INTEGRATED Healthcare Strategies and Governance Institute advisor, for contrib- uting this article. He can be reached at [email protected]. Excellent examples of board-level scorecards are available through e Governance Institute (GovernanceInstitute.com). Metrics for Success: Healthcare Consumerism An Emerging Trend That Will Impact Providers over the Next Decade , 16 BoardRoom Press • GovernanceInstitute.com ADVISORS’ CORNER
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In the June issue of BoardRoom Press, Don Seymour shares components, characteristics, and new metrics for hospitals and health systems in 2024.
Transcript of Metrics for Success: Healthcare Consumerism
!is article is the "nd in a new series looking at components, characteristics, and new met-rics for hospitals and health systems in "#"$.
In his !""# best-selling book, !e World Is Flat, $omas Friedman pointed out that most industries are becoming increas-ingly global in scope. It doesn’t matter much where a company is founded or headquartered; its jobs are moving to the country that o%ers the best value—the best combination of quality and cost. It doesn’t matter much where you live; the products you buy at your local store come from all over the world.
Healthcare isn’t &at (at least not yet), but it’s getting &atter in the U.S. and it is likely to get &atter internationally. As uncertain as we surely are, we must prepare for a new consumerism journey, in which providers are competing for business both within the U.S. as well as globally.
Healthcare Consumerism 2.0In !""', it was reported that Bumrungrad International Hospital o%ered world-class healthcare in the heart of $ailand. U.S. News & World Report featured the hospital on its cover, highlighting its JCI accreditation, internationally trained clinicians, and Amer-ican management as well as its low cost. %# Minutes also covered the story, reporting that the cost, including travel expenses and a vacation on the side, was less than the cost of comparable care in the U.S.
When the aftershocks subsided, U.S. healthcare providers breathed a collective sigh of relief, and then quickly returned to business as usual. Almost no one made seri-ous preparations for global competition.
A lot has changed since !""' but, for the most part, everything remains the same. Consumers have online access to Web sites that o%er comparative provider informa-tion. Online information may be qualita-tive or quantitative, outcomes-based, or focused on process. Much of it is not yet at the level it needs to be in order to be a signi(cant driver of choice. Consumers continue to select providers based on prox-imity, physician referral, and perception.
Consumer behavior will slowly but inexorably change as the integrity of com-parative information improves, insurance companies exert in&uence, and patients assume responsibility for a greater share of
the tab. Aside from Medicare and Medicaid, )" percent of health insurance in the U.S. is still employer-based, and high-deductible plans are quickly penetrating the market, just as they are dominating policy pur-chases made on healthcare exchanges.
$e #"-year-old su%ering shoulder pain from her tennis serve now has options: shell out thousands of dollars to get her shoulder scoped, or take Advil and apply ice while hanging onto the cash. We can’t predict what she’ll choose, but we do know she’ll consider the options more carefully than she would have if the deductible was, say, *#"".
Is this same #"-year-old ready to &y to $ailand for her shoulder procedure? Today, it might seem unlikely. But a decade from now, when she has useable informa-tion on cost and quality, $ailand may become a perfectly reasonable choice. More importantly, as cost information within the U.S. becomes better and easier to understand, and as health insurance marketplaces increasingly cross state lines, consumers will have more choices for domestic care destinations.
Preparing for Consumerism 3.0$e globalization of healthcare is still a long way o%, but the time to prepare is now. $ese are some steps healthcare leaders can take to prepare for a consumer-driven marketplace in the next decade: • Directors, executives, and physicians
must be diligent in focusing their organizations on quality, satisfaction, and e+ciency outcomes. Structures, pro-cesses, and metrics to achieve these outcomes are paramount, and the focus of great governance.
• Board members must demand accurate, comparative board-level scorecards measuring quality, satisfaction, e+ciency, and other outcomes. $e key is to start small with a few indicators that everyone
understands, and increase complexity and sophistication over time.,
$e U.S. cannot compete with the rest of the world on cost, but some patients will feel more comfortable staying within the U.S. for quality care, something the U.S. can compete on. $us, the consumer-driven marketplace will have implications for competition (on quality and cost) both within and outside of the U.S. $e role of leaders is to assist patients in accessing the highest-quality, lowest-cost care, wherever it exists in the world.
U.S. consumers are clearly confused and frustrated when they attempt to discover which provider actually achieves the best outcomes for the procedure they require. $e data is often wrong and, at best, dif-(cult to analyze on a comparative basis. Leaders should instruct their marketing and public relations departments to com-municate with their patients on a level they can understand.
Now is the time to start preparing for a marketplace that crosses national bound-aries. Fortunately, the strategies that will help U.S. providers compete globally will also help them achieve better outcomes at a lower cost to compete locally, regionally, and nationally. Boards need to be relentless in demanding improvements in perfor-mance if their organizations are going to be global players a decade from now. ~
!e Governance Institute thanks Don Seymour, executive vice president with INTEGRATED Healthcare Strategies and Governance Institute advisor, for contrib-uting this article. He can be reached at [email protected].
� Excellent examples of board-level scorecards are available through � e Governance Institute (GovernanceInstitute.com).
Metrics for Success: Healthcare ConsumerismAn Emerging Trend That Will Impact Providers over the Next Decade
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16 BoardRoom Press • !"#$ %&'( GovernanceInstitute.com
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