Karl Rove wrote an op ed piece for the Wall Street Journal today in which he talked about families grappling with health care concerns. No matter what you may think about his politics, he makes one important point for the future of the health care industry: in a capitalistic economy, people make their health care choices based on value.
Rove asserts that “patients rarely know what a procedure will cost of how good a clinic or hospital is, except by reputation and word of mouth.” But, where patients have a choice, they will always make their decisions based upon their best information regarding quality and cost – even when that information is merely word of mouth. The problem facing health care professionals today is that they don’t know how current and prospective patients view the quality and cost of their services. Moreover, I suspect that most health care professionals don’t even know how their targeted markets define quality and value. Do young professionals define quality in the same terms as retirees? How do you know? How can you maximize quality and value for your targeted clientele if you don’t even know (objectively, quantifiably) what’s most important to them?
A key challenge facing health care professionals for the future will be to (a) understand how their targeted markets define quality and value, (b) how those targeted markets perceive the value delivered by each of the alternatives available to them, and (c) to develop strategies and process improvement programs to differentiate themselves on the basis of value.
If you are aware of any health care organizations that have begun to meet this challenge, please drop me a note at Reg@MarketValueSolutions.com. We are eager to identify best practices in this area.