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So Long to the Easy Sale: How Healthcare Marketers Can Reach Patients Reluctant to Spend

Chris Bevolo, April 15, 2009

Consumers thinking twice about all but the most critical or emergent care are at the crux of one of the most significant transformations in healthcare today. The rise in consumer driven health plans, economic difficulties, and more have led many patients to carefully consider which healthcare treatments they really need, and which they can delay or avoid altogether.

Once the territory of the un- or underinsured, active decision making based on cost when it comes to healthcare is trending up for everyone. Recently, this trend hit home personally, when I went to a podiatrist to see about having a persistent and annoying wart removed. Seven treatments of liquid nitrogen later, the wart was still there, and my doctor said it was time for the big guns: laser treatment.

To this point, between my office copay and the 20% copay on "surgical treatments," each liquid nitrogen blast was about $60 out of my pocket. Knowing the laser procedure would be more expensive, my physician suggested I call the outside vendor he uses for laser wart removal to determine what my total cost might be. He said, "It's better than calling your insurer—usually they're a little thrown by the term 'laser.'" I was then handed the vendor's bi-fold brochure and told to make an appointment with the receptionist before I left.

Here's where the difference between yesterday and today for healthcare marketers hits like a sledgehammer. Until recently, I would have simply scheduled the laser appointment. I had good insurance coverage, so my exposure was at worst 20% of the procedure cost. I'd already been through seven treatments at $60, and would want to see the treatment through to the end. (No way the wart would win this battle.) Like many others, I would have moved forward with the treatment and paid the bill.

But not today, and maybe not ever again. First off, I've spent $420 to date on this stubborn little hitch hiker. Do I really want to spend another $200, or more? For most people, that's not trivial coin. I've lived with the wart for 10 years, what's a few more? At the very least, I will call the vendor and my insurance company before moving forward.

No more blind healthcare purchases for me, at least not when I have a choice in the matter.

My attitude is not unique. According to a recent Kaiser Family Foundation HealthTracking Poll, 53% of respondents said their households had cut back on healthcare in the previous year due to cost concerns. Retailer CVS recently announced the closing of 90 MinuteClinics for the season, to "align with consumer demand." Many hospitals and health systems are reporting dramatic drops in utilization. Summing it up recently was David Wessner, CEO of Park Nicollet Health Services in Minneapolis, who was quoted in a Minneapolis Star Tribune story on the financial ills of hospitals. Wessner said: "We're seeing that demand is far more elastic than it was in other years."

How does this change things for healthcare marketers? In a nutshell, your customers are becoming a much more challenging sale. No longer will healthcare consumers blindly follow the advice of their physicians to receive further treatment, not when they're own money is at stake, and not when there's a choice in the matter. So not only will it be harder to compel consumers to choose your organization, it will be harder to convert them to additional care even if you do.

What could my physician and his health system have done differently to ensure I took the next step, and went Star Wars on that wart? Here are just a few ideas:

  • Provide phone or email access to a patient advocate to help me determine the actual cost of the procedure. As it was, I was left to bridge the financial questions myself. I was on my own to contact the vendor and my insurance company to determine the actual cost of the procedure. I have a stake in becoming wart-free, but the health system has a financial stake as well. Why not make it as easy as possible for me to take that step?
  • Make information about pricing examples and options available via literature or on your web site. Now that I'm spending more of my own money (i.e. "consumerism"), I will be more apt to shop around. Maybe there are better options out there. Maybe cheaper as well. If you can't provide a real, live human advocate to help me figure this out, at least provide me literature that gives some pricing examples. Even better, provide me a link to a page on your web site that provides all the information I need, phone numbers, sample pricing, etc.
  • Leverage your brand equity when passing consumers off to strategic partners or other vendors. The brochure I was given was from the vendor, with the vendor's brand. But I don't know them, which means I don't trust them. That introduces a whole new player into the mix for me, which makes it harder for me to just take the next step, sight unseen. Remember, as competition heats up, brands matter even more.
  • Provide educational materials, promotional brochures, etc. that have your brand, even if the service is provided by an outside vendor. It's one less mental hurdle patients have to leap over to take the next step.
  • Multiply my story across the thousands of services, treatments and procedures you provide, and you can begin to see the impact consumerism will have on healthcare organizations. Healthcare marketers who are still using the old-school equivalent of liquid nitrogen applications as their strategies may want to consider charging up the laser, and consider new and different ways of addressing changing market demands.

Chris Bevolo is the author of A Marketer's Guide to Brand Strategy, published by HealthLeaders Media. He is president of Minneapolis-based healthcare marketing firm Interval. He can be reached at chris@thinkinterval.com.
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