Patient Shopping in Our Lifetime?

This was the one of the final questions asked at a recent Elsevier conference where I was a speaker. The panel charged with answering this question was largely pessimistic. Panelists felt that the byzantine system of setting prices for both medical procedures and pharmaceuticals made it unlikely that consumers would ever get the cost data required for effective shopping behavior. They couldn’t imagine that anyone in the industry would step up to the challenge of making prices more transparent.

There is certainly reason for their negative outlook. For example, a recent study by Verilogue and Duke Medical Center found that when oncologists discussed  breast cancer treatment options with patients, costs were only discussed in 20% of the cases. If patients can’t get information on the costs and outcomes of various medical and drug treatments, then they can’t make the appropriate trade-offs.

In my opinion, the Elsevier panel was right and wrong.

Right because strides towards increased pricing transparency won’t come from within the industry. But wrong because change will be instigated from outside the industry—by government, non-profit organizations and entrepreneurs unencumbered by the war wounds of fighting vested health care interests.

Here are a couple of examples that provide me with hope:

  • On the non-profit side, there is the Minnesota Community Measure Up coalition. They created the Minnesota D5 program, which provides effectiveness scores for treating diabetes by individual clinics/HCP offices.
  • Newer health care services like Counsyl, a genetic testing company, have actually built cost transparency into their business model. Counsyl has developed a proprietary tool that allows patients to calculate their exact costs once their particular insurance policy is factored in before they sign up for the service.
  • Iodine, a newcomer in the cost and rating business for drugs, has developed a very easy interface to help consumers start evaluating the cost/quality trade-offs for different medications.

Information will drive true shopper behavior.  Contrary to popular belief, patients can make educated choices. Patients don’t reflexively opt for latest and the greatest medical solution. As reported in the New York Times, a recent study in the Annals of Surgery, found that parents actually made the cost effective choice regarding appendectomies for their children.

When parents were told that both conventional and laparoscopic surgery yielded the same results, but that conventional surgery was far less expensive, two-thirds of parents chose the less expensive conventional surgery. 31% said that the information they received was the primary driver in their decision and 90% liked having a choice.

Pharma companies are going to have to learn how to market to health care shoppers rather than patients. This means that not only will pharmaceutical companies have to include cost in their outcomes studies with payers, they will also have to convince health care shoppers that their drugs represent a good value for the money.

And much like restaurants and hotels, Pharma companies will have to regularly monitor the various patient quality and cost rating systems to make sure their medications are fairly portrayed. A bad rating will have a direct impact on revenues, as consumers fail to start or stop using a medication, based on a rating they saw.

Pharma companies will need to include these products ratings from patient sites in their analyses of sales results. I predict that these analyses will show a direct correlation between consumer ratings and revenue. And when that happens, it will be the dawn of the era of the true health care shopper!

How design thinking can elevate the patient experience

Finding purpose in the mundane

What could be more boring than the traditional patient pamphlet?

Many times patient pamphlets are created without the most important ingredient, the patient. The traditional pamphlet is generally a collection of information that the health care marketer wants to impart to the patient. Little thought is put into what the patient wants to know. And even less thought is put into how the patient wants to physically interact with the pamphlet.

A little design thinking could change all that. One of the key principles of design thinking is purpose. Every element should have a customer-focused reason for existing. This requires a deeply rooted understanding of customers and how they interact with a particular object. It is this understanding that can transform the mundane into the marvelous.

One of the best examples I have ever seen is the in-room collateral for the Wanderlust Hotel in Singapore that I stumbled upon at an American Institute of Graphic Arts (AIGA) exhibit. The design team from Foreign Policy Design had a profound understanding of the prototypical Wanderlust guest. The type of guest who checks into the Wanderlust hotel is “curious and interested in discovering, engaging and immersing in new experiences.” They have a desire for personal growth through exploration.

Based on this understanding, the designers reinvented the “almost-useless conventional in-room directory” into a more useful travel tool. The in-room directory was morphed into an itinerary, full of useful local information including “area maps, train and bus maps, local shops and restaurants as well as thoughtful blank pages for notes and sketches.”

The reimagined in-room directory led to a redesigned check-in procedure. As the AIGA exhibit notes detailed, the itinerary “improved the check-in workflow, converting a laborious and dreaded check-in process into something fun, a talking point.”

This proves that one small design element can trigger a cascade of changes that lead to an improved overall brand experience. And the business results? The hotel has been featured in core travel publications including Travel & Leisure, has appeared on almost 500 blogs, and its room occupancy rates have risen.

And no wonder, “Creating a unique customer experience is one of the best ways to achieve sustainable growth, particularly in industries that are stagnating,” according to the consulting firm ATKearny. In industry after industry, higher customer satisfaction has been shown to drive sales and profits.

So back to the patient pamphlet. What is its core purpose? What is the problem that the pamphlet (or for that matter, the website, app or DTC ad) is trying to solve? What other problems does the patient have? Is there a role it can play there? How should it be redesigned?

What happens if the patient pamphlet is reimagined as an itinerary for better health, rather than merely a way to convey basic product information? Could infusing a higher-order purpose into a pamphlet set off a cascade of changes in all marketing activities?

“Orange is the new Black”: what prisoners and patients have in common

While binge watching the second season of Orange is the new Black I was reminded of an important parallel between patients and prisoners. Both are victims of a “3rd party decider economy” where “the person selecting a product or service is not the person who will actually use it.”

OITNB

In a New York Times article entitled, “Orange Is the New Green,” Adam Davidson, wrote about the plot line where poor Piper waits weeks to get her shower sandals from the prison commissary. In an economically rational world, prison commissaries would try to maximize sales to inmates and minimize out-of-stocks.

After extensive real life research, Davidson concluded that the prison system wasn’t focused on meeting the prisoner’s needs, but rather the prison’s needs. And it was this emphasis on the 3rd party rather than the end user that was thwarting rational economic behavior.

To a large extent, the US health care system has been designed to meet the needs of HCPs rather than patients. Pharmaceutical marketing perpetuates this 3rd party decider distortion by allocating the bulk of marketing budgets to HCPs rather than patients. According to the 2014 MM&M/Ogilvy Healthcare Marketers trend report, pharmaceutical marketers spend over 50% of their budget on physician marketing. This is on par with last years report. Despite all the patient centric talk, spending has not changed.

Like prison commissaries with out-of-stock situations, allocating more money to HCP marketing is not rational economic behavior. There is significant evidence that HCPs’ sway over prescribing decisions is waning. Patients and Payers are increasingly calling the shots. But old habits die hard. Most of pharmaceutical decision makers today have built successful careers on face-to-face selling to HCPs. It is hard to divert budget from a technique that has delivered so faithfully for so many years.

Perhaps the upcoming 2015 planning season will take on this HCP market distortion. The US health care system is slowly being reoriented around patient needs. For example, the government is driving more patient focus with the Affordable Care Act and the FDA has initiated hearings on patient focused drug development.

Pharmaceutical marketers could redesign the 2015 planning process around patient needs. For example, why not use the patient journey to guide investment across all customer groups, not just patients? What are the HCP initiatives that have the most impact on patients? Invest in those! Think of the 2015 planning process as a binge session on the needs of patients, a productive binge session you don’t even have to feel guilty about.

Thanks for letting us share!

Dorothy

3 ways to become radically patient focused

Learning from “Orange is the New Black.”

This is the fourth blog post in a twelve part series that transforms ideas from the marketing world at large into practical plans for pharmaceutical marketing in the time of health care reform. 

Who knew binge watching “Orange is the New Black” could illuminate a central issue distorting pharmaceutical marketing?

Let me back up a bit and connect a few dots.

Adam Davidson wrote an incredibly perceptive piece for the New York Times entitled, “Orange Is the New Green.” His recent binge watching of “Orange Is the New Black” sparked a key economic insight about the“3rd party decider economy” where “the person selecting a product or service is not the person who will actually use it.”  Sounds a lot like pharmaceutical marketing to me and a prime candidate for the 3 e’s of extro-analogs: exploring, extrapolating and exporting.

Davidson’s insight was inspired by a plot line where the protagonist, Piper Chapman, is frustrated by the inability of the prison commissary to provide the shower shoes she has ordered. In an economically rational world, prison commissaries would try to maximize sales to inmates. But the prison wasn’t taking what would be the rational economic path towards revenue maximization. No shower shoes for Piper!

After extensive research, Davidson concluded that the prison system wasn’t focused on meeting the prisoner’s needs, but rather the prison’s needs. And it was this focus on the 3rd party rather than the end user that was thwarting rational economic behavior. In fact, Aramark, a company trying to transform the prison commissary industry “by focusing on what the end-users, the prisoners, want,” was actually suffering in the marketplace.

Healthcare, particularly pharmaceutical marketing, has long suffered from this “3rd party decider economy.” However, there are movements afoot that put more focus on meeting patient, rather than practitioner or payer needs, including:

  • Affordable Care Act with its focus on linking patient experience and outcomes to reimbursement
  • Patient focused drug development initiative by the FDA that includes meetings with patients to help infuse patient reported outcomes (PRO) into the drug development and approval process

While there is certainly a strong rationale for the learned intermediary in pharmaceutical sales (both practical and legal), the 3rd party decider model does cause distortions. Consider the disproportionate investment in physician versus patient communication.

The key concept in the story for extrapolation is the need to maintain a strong focus on the end user, the patient. So what if you took a “radically patient focused” approach to your budget and communications? Here are some thought starters for getting there:

  1. Use the patient journey to guide investment decisions in HCP and payer marketing. The patient journey is the key tool patient marketers use to prioritize patient marketing investments. The tool could also guide physician and payer investments by asking questions such as, “what are the key things HCPs have to communicate about the disease and medication to inspire the patient to continue treatment? What are the barriers to treatment the HCP is uniquely suited to address?
  2. Examine your past HCP and payer initiatives for their potential to benefit the patient. How could your physician and payer programs improve patient experience, compliance and/or outcomes? What would you stop/start/continue if you took a radically patient focused approach?
  3. Determine your internal barriers to communicating with patients. Patients are increasingly using mobile devices and online video to learn about healthcare options. Is your brand adequately represented in these channels? If not, what is holding you back?

Certainly a lot of what pharmaceutical marketers invest in physician and payer marketing is critically important. But it bears examining whether what has been done in the past will still continue to move the needle in this increasingly patient focused healthcare world.

Check back on Thursday for the fifth post in the twelve part series, Three ways to supersize your patient KOL strategy Pepsi-style!” In this post I explore how using an “arts patronage approach” can build important relationships with key patient advocacy groups. 

Thanks for letting us share!

Dorothy