Wednesday, January 12, 2011

Customer/Patient Experience Management Applied to Healthcare Part 2

There are any number of reasons for beginning the Experience Management movement. Many of my readers have more or less begun some type of Customer Experience Management (CEM) or Patient Experience Management (PEM) process. So this post is really for those who still need some prodding in the hospital and health system segment of the healthcare industry and most specialty pharmacies to a large extent.

Consumer Choice of Provider is Based in Experience

In a McKinsey study published in November 2007, McKinsey Quarterly -A Better Hospital Experience, they found that the majority of 2,000 commercial insurance and Medicare patients surveyed would change hospitals to receive a better experience. It was also shown that only 20% of a patients choice is based on the clinical care experience or reputation, 41% is on the nonclinical experience while the remaining 39% is based on doctors recommendation.

The most surprising finding, was that of the 100 physicians also surveyed, that they are often willing to accommodate their patients' request! Doctors will move patients and honor their request for a better experience.

Now if that doesn't get your attention, nothing will. And that was before the Patient Protection and Affordable Care Act. With 34 million consumers coming online to be able to afford healthcare services through the purchase of some type of insurance, they will wield considerable market power.

Disappointing at best, few hospitals, health systems or specialty pharmacies understand or act systemically to understand the patient experience and use that to drive quality and efficiency improvements in their organizations. Most don't even know where to start or who to place in charge of the effort.

Looking for Revenue from Customer/Patient Experience? Try the Business Office.

In a HealthLeaders Media article from October 8, 2010, How to Boost Post-Discharge Revenue, Customer Service, improving the customer/patient experience with the business office can realize cash improvements of 20-30%.

Experience and Service Go Hand-In-Hand.

In the Customer Experience Report North America 2010, Forrester Research found a number of interesting facts. Some of the most interesting:

Of those who decided to stop using an organization - 73% was due to rude staff; 51% due to unknowledgeable staff; 55% due to issues not resolved in a timely manner.
• 79% of customers who had a negative experience told others.
• 59% of consumers recommend a company because of its service.
• 40% purchase from a competitor because of their reputation for great customer service.

Finally, in the 2007 Operationalizing Customer Intelligence in the Contact Center, Business Communications Review:

Customer retention increased by 15% year-over-year for best-in-class CEM practitioner; by 1% for industry-average CEM practitioner; 0% for laggards.
• Customer satisfaction increased 19% year-over-year for best-in-class CEM practitioners; 6% for industry -average; 3% for laggards.
• Profits increased 8% year-over-year for best-in-class CEM practitioners; increased 6% industry-average; decreased 8% for laggards.

A healthcare provider's ability to deliver an experience that sets it apart in the eyes of its payers, physicians and consumers/patients from its competitors - traditional and non-traditional - serves to increase their spending and loyalty to the brand.

I can go on and on about the importance of Customer/Patient Experience Management, but you get the point. The healthcare industry needs to awaken to the potential of Customer/Patient Experience Management before 2014 arrives. By then it will be too late.

Next up a proposed model of Customer/Patient Experience Management that will drive quality and cost improvement that I have developed.

You can continue the conversation with me on:

Michael Krivich is a senior healthcare marketing executive and internationally followed healthcare marketing blogger read daily in over 20 countries around the world. A Fellow, American College of Healthcare Executives as well as a Professional Certified Marketer, American Marketing Association, he can be reached at or 815-293-1471 for hiring as your senior marketing executive , for interim assignments in all aspects of healthcare marketing whether it be strategic or tactical market planning, customer experience management, rebuilding and revitalizing your existing marketing operation, integration of sales and marketing teams, media relations or service line revitalizations. Huthwaite SPIN selling trained and a Miller Heiman Strategic Selling alumni, both highly respected and successful international sales training organizations , I can lead your organization though the challenge of integrating sales and marketing.

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