Point of View in Consumer Centricity

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Point of View in Consumer Centricity
Healthcare Experience and Engagement Enabling
Retention
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Value Envisioned. Value Delivered.
Abstract
Companies launch products and services
toconsumers with the thought that their
productwill offer so much value to the
consumerwithout considering the bigger picture.
It isa holistic view of the consumer
experiencethat matters if consumer centricity is
to beattained. The combination of a
productsfunctionality and the experience it
offers setsa condition for potential
consumerengagement and relationship
development.Translating this to healthcare, it
is importantfor payers to provide information
and tools somembers manage their health while
offering aconnected experience to simplify and
navigatethe complex maze of healthcare.
and lacks a good experience. Transactionssupport
only a fraction of what members needin a
consumer-driven world. Health reform
andConsumer-Directed Health Plans (CDHPs)
startedthe transformation to consumer-focused
healthcare.CDHPs put the consumer or member in
control oftheir health, which places demands on
the payersto provide relevant information and
useful tools thatsupport decision making and
healthy living.Payers cannot develop meaningful
relationshipsthrough transactions alone. They
need to gowhere consumers engage with life every
day theirlifestyles. Lifestyle is the
day-to-day living wherehealthy behaviors are set
and routines developed.Enablers in healthcare,
such as biometricdevices and mobility, offer a
strong connection toconsumers, providing
immediate monitoring andfeedback of their health
indicators. The devices andtheir applications
are tools that support membershealthy
lifestyles. A great experience with
usefulproducts that target a members lifestyle
is awinning combination to improve personal
health andmanage costs.
Executive Summary
The shift to consumer-driven health is
evolvingrapidly. Payers need to adapt to retain
their
members, stay relevant, and manage costs.
Withmedical costs rising and consumers managing
their health, payers want to engage them in
healthybehaviors and cost-effective decision
making. Toengage members, payers need to develop
trustedrelationships and form useful
interactions with theirmembers. Relationships
require a combination
of a superior experience and products that
helpmembers manage their health.
A once antagonistic relationship can turn intoa
productive, lasting relationship by forming
anexperience high in usability around services
and
products that interact with consumers, as well
ascreating the whole experience or journey in
dealingwith a payer.
Traditionally, healthcare payers focused
onproviding support to their members through
transactions. Transactions include such tasks
aslooking up benefits, submitting claims, and
lookingup providers. This is a get the job
done mentality
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Doing The Job
There is a need to combine experience and
function into a consumer model, and I believe
there is a strong use for it in healthcare to
achievemember engagement. An idea came to me
after Iread about the work of Clayton
Christensen and afellow researcher. It was an
article on MilkshakeMarketing from Harvard
Business Schoolpublished in 2011. Claytons
claim is that 95 ofnew products fail, and
companies need to lookat products in the way
that customers do how aproduct gets the job
done. Jobs have functional,emotional, and
social dimensions.
I was fascinated by this article, which followed
the role of a milkshake in the eyes of a
consumer.The goal was to increase the sales of
milkshakes.The study found that consumers bought
the mostmilkshakes in the morning and for a
common
experience of the event before use, during
use,and after use. I observed that products that
werelean on features but robust on the
experience
were more likely to be adopted and succeed.
Theconcept of consumers choosing packaging
overcontent has been around for a while. We
choosea laundry detergent because our family
used
reason. Consumers faced a long commute andneeded
something to make their commute moreinteresting.
They were not hungry but would be by1000 a.m.
The milkshake was thick, so suckingthrough a
straw gave them something to do. Theywere in
business clothes and the milkshake wasless
likely to get their clothes dirty than a donut
orbagel would it was contained enjoyment.
it when growing up (brand) or the color of
thepackage is striking (packaging). Not many
peopleactually read and understand the chemistry
ofthe ingredients (content). Maybe we are
seeinga shift in consumer behavior and the new
formof packaging is the experience.
Personally,I sacrifice features to remove the
hassles ofproduct selection, purchase, and use.
To me,experience became the product
differentiator,if for no other reason than to
avoid addingfrustration to my busy lifestyle. If
a vendor has auseful product with a great
experience, then I donot mind waiting in lines
to get it, either. Even thewait can turn into an
interesting experience if wedesign the
experience well.
Traditional marketing says to segment the
marketby demographics and product. Claytons
argumentwas to segment according to
jobs-to-be-done.
Focusing on the job, they found that by
increasingthe thickness and adding chunks of
fruit, they
enhanced the job-to-be-done and sales
increased.They also had another version, a treat
for childrenwith a thinner consistency so
parents would not
have to wait for them to finish it. This shows
twojobs that needed to be done. Now add
experience.
Experience
Figure 1 shows a model for connecting
theexperience and functionality with
consumerrelationships
I noticed a correlation between a products
joband the overall experience the person has
withit. It seems that more than just user
experience(usability), this involves the journey
or customer
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Value Envisioned. Value Delivered.
Commodity
Valued
Bored
Satisfied
Acceptance
Engagement
Trash
Fad
None
Excited
None
Courtship
CUSTOMER EXPERIENCE better
Figure 1
Scenario 1 - High excitement and limited use
have a foundation for a relationship to develop.
Forrester reports the customer index for cable
TVproviders is in the poor range. From a
consumerperspective, we put up with the cable TV
providerand consumers accept what they are given
butwill jump to another provider at an
opportunity ifthe product stops performing or
they are fed upwith the experience. This
industry has retentionissues, which could be
more severe if there weremore vendors offering
services. The barrier to
IIf you have a useful product that offers a
greatexperience in purchasing it and using it,
you
could see strong user adoption. The
excitementmay not be sustained over time, as
users realizethe fun is gone and the usability
of the producthas waned. Remember the fads of
yesteryear.
Clothing can fit into the category of a fad.
Articlesof clothing that have lost their
excitement includebleached jeans, hoop earrings,
penny loafers, andleggings. They are still
functional, but a shift in theexperience
occurred. Experience can impact
thefunctionality, as well. If a style no longer
createsa good feeling while wearing it, the
clothing no
switching to another provider is low.Scenario 3
- High use and high experienceIf you have a
service with great products anda satisfying
experience, such as Amazon.com, there is a
foundation on which to builda relationship -
even online. Amazon rippedbusiness away from
brick-and-mortar stores andoffers excellent
customer service throughout myshopping
experience. I get reviews of products,updates on
my order, and an evolving shippingstatus in real
time. The experience supports twotenants of
consumerism It is convenient and fast.Facebook
is another example of a product that
longer performs its job to make the person
feelgood, and it will be discarded for another
pieceof clothing. In this mode, you create a
short-termrelationship and the product seems
more like a fadwith a short lifecycle.
Scenario 2 - High use and limited experienceA
product such as phone service and cable TVfrom a
cable provider, which does an OK job andprovides
a poor customer experience, may not
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Some ideas are to offer
consumer centered productsand services aligned
topersonalized needs, tunecustomer experiences
to buildrelationships, and engagemembers in
healthy livingand decision making
withpersonalized programs.
valued area. Repeat that cycle nine months
later.It seems like the experience was being
pulsedto hook me into buying upgrades to keep
the
does the job without getting overly
complicatedand offers a good experience. Users
of Facebookare truly engaged and we see this in
how muchtime is spent on it. It has integrated
into the userslifestyle - a powerful
combination.
experience going. I call this Pulsating
ExperienceMarketing. I was an experience
junkie, and thebehavior seemed a lot like the
way I play with acat. I would put a toy on a
string and then teasethe cat by moving the toy
close and then pulling itaway. Repeat for a
sustainable experience.
To sustain the relationship and use, you
musteither tune the experience to keep it fresh
or
maintain the usefulness of the product. I
believeI see this in Apples iPods. I own four
iPods
and wondered, Why? Apple generated a
funexperience for me with their initial product
launch.For me, it hit the fad stage first and
moved intothe valued area. Early iPods did the
job of playingmusic, but over time I began to
retire my iPod to adrawer. Why? I found that the
excitement of havingone diminished and the
experience decreased. Ithen moved into the
commodity area.
Without the introduction of a new experience,the
first iPod would have gone to my daughters
play box with no repeat of the cycle. I believe
thatexperience and usefulness are closely linked
todriving consumer behavior, and behaviors
driveconsumer engagement.
Experience Job Relationship
Expanding on the concept of MilkshakeMarketing
and translating it to healthcareand consumer
engagement, payers do the
Soon, Apple released a newer model,
whichincreased my excitement, and the bonus was
thenewer model had a new feature, making it
seemmore useful to me. So I bought it. I believe
that Iquickly moved back to the fad area.
Usefulnessand experience are high again, so I
drift into the
job of providing benefit plans and services
toconsumers. In their annual customer
experienceindex, Forrester ranks health plans in
the
poor-to-very-poor range, mostly because the
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Value Envisioned. Value Delivered.
Stage 4 Claim
Stage 5Payment
Accepted
Stage 1 Stage 2 Stage 3
Logged Validation Determination
Stage 4 Claim
Stage 5Appeals
Denied
We received We are We are
The status of your
Payment issued or
your claim reviewing processing
your claim your claim
claim is...
Appeals started
DELIVERY CHANNELS
SMS
_at_
experience of purchasing and using health
plansis less than desirable. On top of this,
payers lackdifferentiation between themselves,
and there isa low barrier to change payers for
consumers.This is largely because payers do not
practicerelationship building with consumers.
is possible that the member will start
wonderingwhat happened to their claim. Payers
are wrong inthat there is no managed experience
- a missedopportunity in relationship building.
After all, it ishuman nature to think the worst,
and in this case,members imagine their claim is
not going well orsomething has gone wrong.
Contrary to popular belief, payers want to
engageconsumers and help them live a healthy
life, butconsumers do not want to be engaged by
payersat this early stage. Instead, consumers
prefer
After a period of time, the member will enter
thefrustrated stage and call their payer to find
out thestatus of their claim. This call will end
up costingthe payer approximately 3 to 5. If
payers couldgenerate a better member experience
around theclaims process, the payer would not
incur the
to have an existing relationship in place
withpayers in order to build a deeper
relationship.
Only when the consumer experience and the jobto
be done are considered acceptable by the
cost of this call. Perhaps, payers could
providea message to members using SMS or email
toadvise them where their claim is in the
process.
consumer, can a payer then begin to build
andnurture the relationship.
They could use a simple graphic with a
five-stageprocess or a text message stating the
claim isin Stage 3 with We are processing
your claimwith no expected delays, which
provides the
If you ask them, payers may say there is a
lackof consumer or member experience during
the claims process because payers processthe
claims internally and the member does not
necessary and relevant information to prevent
theconsumer from entering the frustrated
stage.Does this sound familiar? Amazon
accomplishesthis feat by communicating
order-tracking
participate directly. The payers to a degree can
beconsidered right and wrong in this regard.
Theyare right in that payers do not in fact
generate amember experience during this process
and it
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Building relationships aids in memberengagement
and increases retention. It is aboutthe quality
of the interaction, and not the quantity.The
relationship is formed around commongoals such
as improving members health. Ifthe interaction
is pointless and without value,it becomes
annoying to the member and theexperience
deteriorates.
information to show consumers their
orderstatuses. Seeing order activity or progress
easesthe concerns of consumers as they wait for
theirorder to be processed and shipped.
In a consumer-driven world, we usually do
notlike to wait. That being so, if payers were
able tocommunicate the status of a consumers
claimas it traveled through the process, the
memberexperience would be much more enjoyable.
Engagement is Good for Everyone
Members would become satisfied, since thepayer
took the action first and generated a
dialogaround the claim event. This may even
sound likea reassuring voice, such as, Dont
worry, we areproviding personalized attention to
your claim.With this capability, members would
be ableto choose how much information they want
toreceive, how often, and even select their
preferredchannel of delivery. After all, it is
all about me inthe world of the consumer.
Engagement at a member level has manybenefits,
not only for members, but also for
payers and the health system. At the
EngagedStage, payers can
Modify member behaviors to lower likelihood
of chronic diseases
Promote healthy living for members
Offer information and tools to help members
make intelligent health decisions
By providing a positive member experiencecoupled
with products that do the required job,payers
are now able to build relationships withmembers
through useful communications andinteractions.
Over time, as the relationship grows,the
opportunity for engagement by the payer willbe
created.
Because medical costs are increasing at
analarming rate each year, member health is
apriority for payers and providers in order to
manage costs. The CDC says chronic
diseasesaccount for 3 of every 4 spent on
healthcareand that chronic diseases are
preventable by
modifying consumer behaviors. This is a
perfectexample of how consumer engagement
solutionscan help lower costs and decrease
chronic
In order to build relationships with
members,however, payers must focus on the
followingthree guidelines
diseases, but member relationships are
requiredfor engagement programs. For payers to
engagetheir members, they need to focus on two
areas
1. Offer a product that does the job for
members in a way they want the job to be done.
1. The customer and user experience
2. Provide a grand experience in two areas a
2. A product or service that performs what the
well-designed member experience on allmember
touch points and a tuned memberexperience so
that consumers are happyinteracting with the
payer.
member wants to do
By bringing these two items into the design of
amobile app that supports healthy behaviors with
relevant content, healthy tips, and
encouragement,the payers open the door to
engagement with
3. Extend their products to be more than benefit
plans and provide members the tools
members by helping them modify their
behaviorsthat lead to chronic diseases. That is
a lot to
to help them in their pursuit of healthy
livingand enjoyable lifestyles. The result is
that thedoing the job indicator goes up.
say, but you can see how it is all connected,
andhealthcare has many moving parts
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Value Envisioned. Value Delivered.
Consumer Centricity
HealthScape
A rise in priority of consumer centricity is
justas important as cost management is for
payers.Engaging members in healthy living and
usingself-service tools is important to lowering
healthcosts and empowering members in an era of
The traditional interaction with payers has
beenaround transactions find a doctor or
pharmacy,look up my benefits, and look up my
claim. This isthe transaction layer in the
consumer relationship.There is little
opportunity for a payer to developa relationship
and generate consumer stickinessin this area.
Members, in this case, only go to thetransaction
layer to perform a transaction, whichfor any
large payer is about one to two times a
consumer-driven healthcare. Therefore, in the
end,a sustainable solution to lowering health
costs andhaving a healthy member base over the
long termcan be achieved through consumer
centricity.
This approach takes time and is an investment
inthe health system and in its members.
year. The main reason that many members performa
transaction is because they are going through
ahealth event, like a sickness or medical
condition,and members are already in a stressed
state of
If you are looking for low-hanging fruit and
easysuccesses, focus on the user experience.
Thefastest road to a good experience is to
removepain points in services and products that
touchcustomers. Usability testing can provide
mind dealing with a personal or family health
issue.This is not the best time to generate a
relationship.The best way a payer can generate a
positive
experience in this layer is to provide
superiorsupport for the member when needed. This
enlightening results and insight into any such
painpoints. An annoyed customer can be
transformedinto a satisfied customer by
assessing online
translates to a flawless experience by offering
acaring connection, managing administrative
tasksand processes, and performing event
logistics
assets and updating the design based onthe
findings.
so members can focus on their health. In orderto
build productive relationships, payers need togo
where the people are when they are in a
goodstate of mind.
In order to offer a more consumer-centricexperien
ce, some solutions could be to offerconsumer-cent
ered products and services thatare aligned to
the consumers personalized needs,tune customer
experiences to build relationships,or engage
members in healthy living and decisionmaking
with personalized programs. These areall
examples that can contribute to lower costsby
improving member health and consumerengagement.
Payers now have a raison detreand they remain
relevant. Payers can use their bigdata
repositories filled with member informationto
provide members with targeted and
relevantinformation and tools backed by a
terrificexperience. Why would it work? Payers
wouldtake time to build relationships and trust
withtheir members and shift into a consumer mode
ofbusiness. Moving to a consumer view is a
gracefultransition toward diversification, since
payers canprovide solutions that accommodate
memberswhere they live the most in their
lifestyle.
Figure 3 shows a representation of
theHealthScape from a consumer
perspective.There are three distinct layers
around health andconsumer involvement, with the
transaction layerbeing at the core. Each layer
is different in howoften members interact in
each layer.In the Transaction Layer, members
may interactseveral times a year with a payer
performinga health transaction. In the Wellness
Layer,members interact far more often, such as
one totwo times a week, depending on their
personalplans for nutrition and exercise. When
in theLifestyle Layer, there is a potential
for membersto be involved in health every day,
as it becomespart of a routine in a persons
daily living. In theLifestyle Layer, a payer
has the potentialto achieve relationship nirvana
- stickiness.
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While in the Wellness Layer, members
arefocusing on sustaining or achieving a
stateof wellness. In this layer, the main issues
onmembers minds are nutrition, exercise, and
often enough, their thinking will be changedand
a new behavior formed, leading to
healthy outcomes.
Solutions in the Lifestyle Layer focus
onsupporting consumers in their quest for
sustainedhealthy living. It is important to help
membersapproach health in a holistic manner and
offerencouragement in the form of helpful
toolsthat promote education in the areas of
nutrition,exercise, stress, care, community, and
healthy living
healthy behaviors. Members are focusing on
theirhealth to minimize the risk of becoming
sick andmaximize the potential of leading a
productive life.Members also begin to enter into
a relationshipwith wellness providers and
coaches to engagein healthy behaviors. Telephone
coaching is an
example of this. However, wellness is one ofmany
personal priorities a member
habits. In this layer, relationship maturity can
blossom. To assist payers in
manages, so it may not be theirtop priority all
the time. For
their vision to diversify, they can take
advantage of
wellness to be embraced,a member must
absorbhealthy thinking into
this opportunity in the Lifestyle Layer by
offering such tools to reinforce healthy
their life on a dailybasis and it mustbecome
part oftheir lifestyle.
behaviors for their members and
provide more than just health plans. The
definition of health to a payer ismore about
healthy
In a LifestyleLayer, membersinteract, work,
play,and experience lifeevery day. Examplesof
health in the
living for members and not just paying a
claim.Years ago, the same
Lifestyle Layer are themany new devices that
transformation occurred inthe banking industry.
Banks
monitor daily activity, suchas sleeping habits
and nutrition.The Jawbone UP and
Fitbit Figure
interacted with consumers simply
3 by performing transactions such
HealthScape for Consumers
Flex are wearable devices
as depositing a check. Now
providing biometric data to
banks offer a full suite of services, such as
financialplanning for retirement, college
savings, and familygrowth, supporting a person
throughout their life.An extension of a payers
offer could be to
consumers throughout the day. These
devicesprovide feedback to members so they can
adjusttheir actions and behaviors in order to
reach theirdesired goals. These devices become
part of the
aggregate data from multiple biometric devices
toprovide services to their members such as a
healthdashboard with relevant content to support
decisionmaking and behavior changes in pursuit
of healthierliving. As mentioned under the
Engagement
wearers lifestyle and that lifestyle changes
basedon the feedback they receive. If a member
worksin an office and sits at a desk too long,
an alarmwill go off, letting the wearer know
they need tobe more active and move around. If
this happens
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Value Envisioned. Value Delivered.
trust - relationship indicator
plan tasks
wellness
lifestyle
transaction
engaged
embedded
procuct provider
coordinated partner
strategic advisor
Section, healthy behavior lowers the likelihood
ofchronic diseases, which in turn lowers
medicalcosts in health care.
organizations to minimize risks
Integrated mobile and social enablers to
optimize consumer engagement
Summary
Payer remains relevant through useful
solutionsPayer centricity and provider
centricity is replacedover time with consumer
centricity. Consumersbegin to take control of
their health, with payersand providers
transforming to meet the consumer
It may appear that payers are losing some
controlto consumers, but in reality, they are
increasing costcontrol through member
enablement. It is importantfor payers to trust
and empower members to do
the right thing for their health. Payers must
providerelevant information and decision tools
to arm theirmembers in their pursuit of a
healthy lifestyle.
challenge of a long, productive life and quality
carewhile managing costs.
The goal is to have an engaged, healthy
communityof people. With so many moving parts
and
The benefits of consumer centricity align well
withpayer value
interactions, a thorough assessment of the
payersapproach to a consumer-driven world is
requiredbefore embarking on launching disparate
tacticalprograms, or confusion replaces
engagement.
Coordinated member experience
Personalized communications to channel
preferences for engagement
Usable consumer tools and online assets
to manage the experience
Align consumer programs with the
business strategy to manage effectiveness
Drive member healthy behaviors to
manage chronic diseases and manage costs
Support consumer health decisions with
information and tools to manage costs
Unified platform for member communications
for consistency
Generate 11 relationships with members
for retention and engagement
Increase stickiness with members for retention
Compliance to CMS and federal disabilities
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About Paragon Solutions
Forrester and the Temkin Grouppublish an annual
customer
Paragon Solutions is an advisory consultingand
systems integration firm that specializes in
experience index with healthplans landing in the
poor to verypoor range and below all
otherindustries tested.
enterprise information management to help
clientsleverage information assets for better
business
results. The company does this through its
industrypractices, solution accelerators and
specialized
technology competencies that help clients
achieveoperational efficiency, business
scalability, and
2013 Temkin Experience Ratings (TxR), Range of
Industry Scores
regulatory compliance.
Paragon works with businesses that are focusedin
a few key industries - communications,
financialservices, healthcare, insurance, and
life sciences.The industry-focused practices
50 60 70 80
work with Paragons competency groups to
addresstodays client concerns in Process
Optimization,
Information Management, and Information
Insight.For more information, please visit the
Paragon
website at www.consultparagon.com, or call
1.800.462.5582.
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https//twitter.com/consultparagon
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Health Plans
Corporate Headquarters - Cranford, NJChicago
Boston New York Philadelphia
Low Score Industry Average High Score
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Copyright 2013 Paragon Solutions is a
registered trademark of Paragon Solutions, Inc.
Base 10,000 U.S Consumers
Source Temkin Group Q1 2013 Consumer Benchmark
SurveyCopyright 2013 Temkin Group All Rights
Reserved
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