When most healthcare executives talk about customer satisfaction, they focus on the days before and during clinical treatment. The fact that customer satisfaction is a topic on executives' minds is great. But why does the focus stop at discharge?
For many patients, contact and interactivity with the hospital will continue on in the business office for many months or even years. There will be multiple rounds of communication regarding benefits, payment responsibility, and balances due; there might be outbound and inbound phone calls; and there will definitely be multiple hospital resources and hospital service partners involved.
The result of executives disproportionately focusing their attention to the processes before and during treatment is having exactly the impact you would expect on the back end phases. Back-end processes are the organization's satisfaction laggards. In fact, the typical business office process is structurally set up to erode customer satisfaction. Processes are set up to lower costs and ignore almost all the basic rules of customer service, loyalty and personal connection. We are treating all customers basically the same.
Typically, every patient with payment responsibility after insurance gets the same letter, the same message, the same phone call. The same applies to the uninsured patient. Sometimes, there is not even a difference between the uninsured and the balance after insurance letters. All customer calls are handled by the same customer service teams, with the same training and same objective—to collect as much cash as they can, as quickly as possible.
No clinician's practice would ever accept this approach. Clinical practices tailor standard treatments to the patient's unique situation. Based on the presenting conditions and the situation of the patient, clinicians adjust the sequence of treatments, the location, and even the timing.
Outside of healthcare, businesses that sell to consumers recognize that people are different and those differences are, in fact, opportunities. They are opportunities to create loyalty; opportunities to reduce operating costs; opportunities to increase revenue. Moreover, consumer businesses recognize that post-sales support is a critical lever to accomplishing these objectives. All of a company's interactions impact the consumer perception and willingness to repurchase.
Why is healthcare different?
In the business office, the consumer is known as self-pay. Self-pay is that revenue stream no hospital or physician really wants to deal with. Self-pay generates all the bad debt, costs too much and takes too long to collect. These realities have created an atmosphere in which customer service is viewed as a necessary evil as opposed to a business opportunity.
Unfortunately, self-pay is also the revenue stream that is growing the fastest and will become paramount to hospital success in the future. Health reform is likely to accelerate this phenomenon as most patients will experience larger deductibles, more uncovered procedures, more co-payments and occasionally coinsurance. Whereas the true uninsured numbers will fall, almost every other patient will suddenly become a balance-after-insurance account.
With the future so clear, what if we thought about self-pay and the business office process differently? Is it possible to embrace the ideas of loyalty and consumer marketing in healthcare business offices? Is it possible to act like our clinicians and use data to inform our next action? Will thinking differently create a better customer experience? In a word, yes.
Self-pay accounts are predictably diverse. It is predictable which accounts need help to resolve their bills. It is predictable which accounts will pay their bills from basic letters. It is predictable which accounts will both pay their bills and have repeat visits, effectively being customers with higher lifetime revenue potential. It is predictable which accounts will not be capable of paying their bill and will want to evade interaction.
Customer segments should be defined around the necessary experience needed for that customer to resolve their bill. A customer-centric business office tailors its customer contact efforts in each segment to meet the specific needs of those customers and the priorities of the hospital. For instance, for patients we know will pay based on basic letter efforts, we do not make early, or any, phone calls. Not only does this avoid the cost of the call but also the risk of a negative reaction to the intrusion. Similarly, segmenting customers can segregate the people who are more reluctant participants and deliver them a more frank message with ideas regarding proactive resolution.
With basic segmentation and specialized workflows, customer satisfaction will increase. Customer experiences improve simply by separating those who need early intervention from those who don't.
In addition, significantly more cash and less bad debt will emerge from the business office. In my experience, cash improvement of 20-30% is typical. These gains are achieved without new infrastructure, without more people, and without organizational disruption. It all starts with simply thinking about self-pay revenue as one would relationship or direct marketing.
While more cash and more satisfied patients is a good start, it is not the end. Ultimately, we need to connect the back-end, post-sale processes to the front-end, new-sales effort. We can use our business office efforts to drive new revenue and clinical service. It is often predictable which customers are likely to have a follow on purchase (hospital visit). Leverage this insight in resolving the first bill to influence the next visit and make it more valuable to the hospital and pleasing to the patient. For the emerging Accountable Care Organization, this closed loop thinking will be a differentiator for productive consumer relationships.
The ability to capitalize on this opportunity is rapidly increasing with new technology and products. Vendors are specializing in consumer financing solutions or letter programs which can be targeted to their best candidates, and away from less viable prospects. Broadcast messages, a routine feature on current dialer systems, allow for very low cost, highly targeted customer activation, with messages such as "please call to speak to a representative" or "we recommend you go online to resolve" or "this bill is getting late and we are concerned you may have forgotten."
Online kiosks present another emerging platform to improve cash recovery, reduce transaction costs for customers and the business office, and influence future purchases. When rolling out this platform, it is critical that healthcare executives think about what expectations they want to set with their customers today so that it opens up possibilities tomorrow. It is always harder to change something that is prevalent. Why not offer free parking for the next visit to customers who resolve bills through online solutions? This is conceptually the same principle as airlines charging no service fee when a ticket is booked online but $25 when booked via the phone with a travel representative. Airlines want capable people to book simple trips online; hospitals want some accounts to manage themselves online.
By combining the various media together—letters, broadcast messages, online platforms and customer service representatives—a business office can deliver breakthrough cash performance as well as contribute to building loyalty among critical segments of customers. After all, why spend all the time making customers feel good around the clinical event only to destroy that goodwill with clumsy and simplistic business office efforts?
Steve Levin is CEO and co-founder of Connance in Waltham, MA. He may be reached at slevin@connance.com.