Healthcare Consumerism is Different from Traditional Consumerism in Many Ways—But Here’s One Way it’s Not

When it comes to creating smart consumers who are empowered to choose services or products that bring them the most value, healthcare is unlike any other sector. Many of the challenges that come with helping someone “shop” for a service or provider are unique to healthcare.

But there’s a way in which consumerism in healthcare isn’t so different from any other consumer sector: Cost isn’t always the bottom line in purchasing decisions.

Imagine you’re researching options for an upcoming flight. You’re likely to take into account factors like convenience and trust in addition to price. If a flight is slightly less expensive but you have to drive an extra hour to get to that particular airport, chances are you’ll spring for the closer option. Further, if you find a great deal but it’s on an airline you have a negative brand image for (or have never heard of) and therefore don’t trust as much as airlines you’ve flown before, you’re not likely to trade your sense of safety for saving a little money.

The same idea applies to healthcare consumers. People evaluate trade-offs implicitly, like trust and convenience, when choosing a doctor, a facility, or even a health insurance plan. In order to best help your population get the most value out of their healthcare choices, ask them which trade-offs affect their decision-making the most, and then plan to address them.

We did, and saw this phenomenon illustrated in a study we conducted with the University of Chicago Booth School of Business about MRI decision-making. We learned that consumers considered both convenience (drive-time to facility) and trust (a physician referral), in addition to cost when choosing where to get an MRI. In fact, an analysis of 237 consumers showed that for the average patient, a facility 40 minutes closer to home was worth spending an extra $154 out of pocket, and a physician referral was worth spending $205 more. Unearthing these implicit tradeoffs, enables us to design recommendations of their “best match” when they shop rather than simply showing them lists sorted by price or by distance.

Similarly, people implicitly or explicitly trade off between taking risk (higher deductible), having more choice (broader networks) and premiums (paycheck contributions) when choosing a health plan and decision support tools should come up with the best match to be most effective.

To help us even further craft messaging that works with peoples’ existing consumer tendencies when they’re first learning how to “shop around” for healthcare, we’re currently exploring how and why people choose specific sites of care over others, as well as consumer biases applied to healthcare versus other typical consumer settings.

The success of recommendation engines will depend on how well they understand consumer tradeoffs and simplify the user’s journey to find best matches. The stakes are high–and we are up for this challenge, learning from consumers and designing the next generation of tools to transform healthcare.

What does your organization do to deliver the right recommendation to consumers at just the right time? How are you enabling consumerism?

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