Why Customer-Centricity Doesn’t Matter As Much As You Think It Does

flying cadeuciiCustomer centricity has been a mantra of managed care organizations for well over a decade. If you listen closely, you can hear plaintive cries of our care providers, lamenting the labyrinthine, almost Kafka-esque system of prior authorization, reimbursement, meaningful use, and near-real-time obsolescence of medical technology. The crushing weight of reform, the perverted incentives created by volume-based reimbursement, and the soaring costs of doing business have created a situation, much like in public education, where our system is fueled primarily by the power of a dedicated and passionate community whose members are motivated by their desire to care for other human beings.

“How can we possibly think about self-service websites when we are holding back an imploding healthcare delivery system”. Maybe we need to ask a more basic question…..is the U.S. healthcare system viable in the long-term? That question might simply be too hard to answer. So instead, we try to convince ourselves that, like educating our citizens, delivering medical care should be treated as a business. Innovation and value are fueled by financial incentives and healthcare is no different.

But it is different. It is very different.

In some particularly competitive/ wealthy markets, Providers are offering differentiated services….delivery rooms with hotel-style amenities, upgraded menus, concierge services, etc., usually available for an extra charge. But these services are not adding to anyone’s bottom line…they are just attracting those few patients who have the luxury of choice. Where is the value here?

It seems many physician offices are orienting around a much less ambitious goal – avoid delivering a predictably negative experience. Currently, the average wait time for patients can be quadruple the time spent actually receiving care. Lost wages, cumbersome paper forms, an absence of self service capabilities, the challenge of presenting complex information in plain language, ambivalent front desk staff…the list goes on. We have some basic issues to address before we can start thinking big.

There are plenty of explanations for why healthcare is so behind the curve…..but even low-margin industries with the most woefully ineffective service models were able to drive change. Leaders pursued common sense efficiency improvements which exploited technologies and enabled win-win investments that benefited customers and companies alike. So healthcare, what gives?

Is it a lack of will, limited incentives, a complex supply/ value chain, complicated revenue models with too many hands in the pot? These more nuanced questions have been explored primarily by policy makers and academics…but few in business world have time or patience for policy wonks. Where is the silver bullet, the visionary leader, the shiny new technology, the secret sauce? There seems to be a disconnect here as our regulators seek legislative solutions and industry leaders look to more traditional business management approaches and technology for answers.

While we are collectively wrestling with these larger questions…we have nonetheless widely adopted the view that we must mend our ways, in spite of, or because of, government-driven reform. We should act more like a hospitality company or online retailer…then at least customers will have a better experience accessing their increasingly unaffordable health insurance, fragmented care, and opaquely-priced services.

Self-hating healthcare professionals (mostly on the payor side) have been getting up on their soap-boxes, proclaiming that consumer centricity is a strategic imperative, necessary to elevate our healthcare system to the level of customer service provided by the likes of Marriott or Amazon.com. We are smart too, right? It’s the fault of our legacy systems, isn’t it? How can we innovate when all of our resources are drained away by the burden of caring and feeding a decades-old claim platform cobbled together with COBOL and DB2?

While there are some obvious arguments to counter this as an inevitable conclusion….the prevailing wisdom is that must get ahead of the transition of consumers from Group to Individual markets. It is easy to contrast healthcare delivery from a night in a hotel or online purchase. Very different services indeed, but we have concluded that the voice of the customer must be heard and heeded nonetheless.

But there seems to be something deeper and more urgent than service models and customer surveys. What creates a satisfied patient? The answer will likely vary widely depending who you ask….but certain elements seem fundamental to the patient experience: a competent medical professional with whom we can trust our most personal and sensitive information. The annoyance of paper forms and surly receptionists are washed away by the healing hand of a compassionate and brilliant physician. Someone who can calmly help us navigate the deep and dark waters of our own mortality. We don’t go to the doctor to celebrate our anniversary or spend our annual bonus like we might a hotel or online shopping. A night in the emergency room on our wedding anniversary, quietly calculating our deductible would be disappointing, and offer little possibility for “delight”.

So why is customer centricity so prominent in enterprise KPIs and corporate strategies? Hospitals and health plans are hiring outside the industry to help chart the course to service parity. Corporate communications are rife with pleas to all employees…we are now all collectively responsible to elevate the patient experience. Customer centricity has become the end-game, our holy grail.

This brings us back to the more basic question: is our healthcare system viable in the long-term? How will customer centricity solve the issue of overall sustainability? Will customer centricity make people healthier, train the next generation of healthcare providers, or help to achieve clinical excellence while reducing the cost of care. It might not. In fact, it might even undermine those efforts.

The customer is notoriously fickle, driven by emotion, and increasingly demanding as a result of the impossibly high bar set by many “new economy” service providers. But what do these service providers have in common aside from not being healthcare companies? The source of their advantage is not about a management philosophy, a mind-set, or being free from legacy technology – it is about control over the delivery platform. When Amazon or Hilton innovate, they can, to a much greater degree than a hospital or payer, configure their platform for innovation. Our healthcare system is a patchwork of disconnected platforms and communications protocols. Unstructured data is the rule, not the exception. Integration is built upon the EDI standard….how much innovation does an 837 EDI file allow?

So perhaps it is time to acknowledge what the policy wonks have been saying all along……the challenges of our healthcare system will be addressed by creating value for all the stakeholders in the value chain, not just customers, and instead of working to delight customers, we should be working to remove the barriers to achieving efficiency and sustainability. At that point, patients and care providers can focus on what is most important – making human beings healthier.

Jeremy Wallman is a consultant based in Connecticut.

Categories: Uncategorized

4 replies »

  1. Yes…..but most of these easily go away…..if we get the option to choose indemnity style health insurance…..or choose high deductible plans linked to health savings accounts. All we need is 10-15% of patients to be in such plans to discipline the suppliers and induce competition on price and quality (=value). The problem is that our health care elites and provider elites will fight this tooth and nail.

  2. We don’t have that many fundamental problems with health care, do we?
    1. Provider-induced demand.
    2. Moral hazard in patients.
    3. 3rd-party payers; the insurance dilemma. Patients not feeling costs.
    4. The technology imperative. What is the best way to bring in new technology?
    5. Possible infinite demand of some services, e.g.mental health..
    6. Limitation of supply of certain providers: e.g. GPs, dentists.
    7. Assymtrical tax treatment of employment-based HI.
    8. Long term care.

  3. I have a private free-standing Occupation Medicine practice in a small community. Today an employer brought in a young lady who had been stung by a bee. They were concerned because she was reportedly allergic. As soon as she hit the door, my staff got ice on her wound, and came and got me. Without any major paperwork other than getting her name, we situated her on a cart, checked her vitals and examined her to make sure she wasn’t having a potentially fatal reaction (she wasn’t). We then gave her a couple of meds for swelling pain and allergies, and because she was feeling queasy, one of my staff kept an eye on her for about half an hour while a family member came to pick her up. In the meantime I went over with her and the employer what to expect and how to treat her injury the next couple of days. When she was stable, the proper Worker’s Comp and pertinent paperwork was completed and she was discharged in the care of her family member.
    No boxes clicked, no wasted time with inane non-essential paperwork or ludicrous non-pertinent questions. Patient seen, evaluated, treated and given instructions, left happy if still somewhat uncomfortable from the sting.
    This, folks, is how many private offices have practiced good quality patient care for many years. This though is no longer the norm. It’s more like this:


  4. Many good questions and issues raised here…about what better “customer service” should be about and what it can do to improve health outcomes and reduce the rate of cost growth. The barriers are many in current system, as noted. But I, for one, think it MUST be a core component as delivery system and practice of medicine itself gets reengineered. That is happening, albeit too slowly and spottily. I agree focused thinking is needed on how best to do, and accelerate. Thanks Jeremy for a provocative post.