By Paul Roscoe, Docent Health CEO
We see amazing instances of true human connection and individual relationships but most health systems are still failing – as compared to other industries – to build a brand relationship with their customers.
This is a problem but also a huge opportunity. Patients aren’t loyal to the health system brand. We see leakage rates of anywhere from 40-65% for health systems. Other industries track this as a capture of wallet share. You have customers in your market that have used at least one of the services you offer, but for whatever reason spend approximately half their dollars with one of your competitors. 100% wallet share is unlikely, there’s always something that you don’t offer. But 50% is way below what it could be. Health systems have been actively expanding to provide more coverage of services. Now is the time to really focus on retaining customers who need those services.
According to the Health Care Cost Institute, the average patient spends $2,333 dollars a year on inpatient and outpatient services. For a health system that manages a market of 500,000 customers that’s $1.17 Billion in potential health care revenue.
If your leakage rate is 50% you’re missing out on $583 million dollars.
Fortunately, consumer trends are favorable. Physicians are losing primary agency in guiding the patient’s healthcare purchasing decisions. Other industries have established a model for building brand loyalty with customers. Patients are behaving more and more as empowered consumers with increased access to information, community reviews, and more cost exposure. The health system is in the best position it has ever been in to establish a brand relationship and capture customer loyalty.
Win back lost revenue by building loyalty and advocacy. Even a 10% improvement in retention for the theoretical health system mentioned above would generate $117 million a year.
Other industries have proven the model: improve convenience and make customers feel known, valued, and heard. Docent Health just released a case study with our partner Dignity Health showing how focusing on customer experience can improve patient experience, grow volume, improve payor mix, generate better outcomes, and decrease costs.
Click below to learn more about how we helped a Dignity Health hospital mission to improve the Maternity experience and grow market share in a declining market with stiff competition, while growing HCAHPS, and improving nurse efficiency.
New models are emerging that challenge us on convenience, customer service, and new out-of-industry models (CVS/Aetna, One Medical, Apple/Amazon/Google). Health systems will have to compete on all these fronts but they have a unique ability to differentiate by owning the customer relationship with a holistic approach to customer relationship management.
See what Docent Health is doing in partnership with the Hospital for Special Surgery, Dignity Health, and Intermountain Healthcare to build and manage customer relationships, and drive growth and brand loyalty in our next blog post.
Thanks for sharing!
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