More Choices, Greater Engagement, Better Experience: The Rise of the Healthcare Consumer
Bose recently conducted a survey in the United States, revealing that consumers have heightened expectations for the healthcare industry. As consumers gain increasing influence over medical services, how can stakeholders effectively address their needs amidst this unstoppable transformation? VCBeat has compiled and translated Bose’s report to explore what emerging healthcare consumers truly desire.
In the United States, the healthcare industry has a new boss: the consumer. After surveying more than 2,000 U.S. residents, VCBeat concluded that there is widespread dissatisfaction with the overall healthcare experience. As expectations continue to rise for greater transparency, value, customer service, and more convenient access to care, the healthcare industry is undergoing a transformation—with consumers determining the direction of this change.
Widespread dissatisfaction with the current state of healthcare has created opportunities for new entrants from various industries, ranging from retailers like Target and Walmart to internet giants such as Google and Amazon. A recent report by the PwC Health Research Institute examines how these newcomers are gradually disrupting the $2.8 trillion U.S. healthcare market by catering to increasingly empowered consumers. According to a survey by Booz Allen Hamilton, consumers are willing to trust non-traditional healthcare providers when they perceive that conventional healthcare entities fail to meet their needs.
Consumers, particularly the younger generation, expect the healthcare industry to emulate internet companies by offering user-friendly interfaces, transparent pricing, and a wide array of products tailored to diverse needs. Their purchasing experiences in other sectors have made them more informed and skeptical, driving their demand for clarity on what they are actually paying for.
Shifting expectations create opportunities, and vice versa. Transparent markets and expanding choices mean that traditional healthcare providers and payers can no longer rely on maintaining the status quo. The ultimate winners will be those companies that specialize in the following three areas:
Consumer Choice
Consumer Engagement
Consumer User Experience
Key Findings from Boss Zhipin's Research
Consumers are relatively satisfied with individual service items, but overall, they are dissatisfied.
66% of respondents were satisfied with their experience regarding core benefits, and 63% were satisfied with service quality and cost; however, the overall satisfaction rate was only 49%.
Consumers are adapting to insurance transactions far more quickly than anticipated, demonstrating exceptionally high loyalty to the underwriters of their first-purchased insurance plans.
More than half of consumers are highly satisfied with their insurance transaction experience, while only 22% express dissatisfaction. A roughly equivalent proportion report feeling confident during the purchase process. Among consumers who purchased insurance through private transactions, 73% indicate they intend to remain with the same insurer in the following year.
Consumers are not averse to trying to purchase insurance through new channels.
40% of consumers believe they would trust health services provided by large retailers. Thirty-eight percent would trust internet companies such as Google and Amazon, a proportion roughly equivalent to the 37% of consumers who trust insurance companies.
Younger consumers are more price-sensitive and more easily swayed by appearance, yet they possess a longer-term perspective.
Younger consumers place greater emphasis on value than any other generation. Half of them indicate a preference for modern hospitals that may not be top-ranked, yet they prioritize “trusted advice” rather than considering value alone. This also demonstrates their pursuit of long-term pragmatism in healthcare quality, showing that they are concerned with more than just medical costs.
In terms of digital health services, there is a mismatch between consumer expectations and actual outcomes.
80% of respondents expressed willingness to engage in digital health services that assist with health management, yet only 23% are actually doing so. This may further indicate that more than half of the respondents prefer digital management as their primary mode of health engagement, rather than opting for in-person consultations or telephone advice.
Satisfaction Rate for Certain Services Exceeds Overall Service Satisfaction Rate
When it comes to healthcare, consumers are both satisfied and dissatisfied. More than half of the people are dissatisfied with the overall experience, even though most of them are satisfied with some aspects:
Core Interests
Healthcare Quality and Costs
Management Services
Participation in Health Management Programs
This seemingly paradoxical phenomenon can be explained by the fact that consumers’ expectations of healthcare differ from their expectations of other industries. In most sectors, the notion that “the customer is king” has taken hold; driven by competition, digital interactions have become increasingly prevalent, placing control firmly in the hands of consumers. A single negative review on Yelp may deter a consumer from dining at a particular restaurant, while airlines with exorbitant fees listed on Kayak are simply ignored. However, in the healthcare sector, consumers have long been in a position of powerlessness, accustomed to having their needs unmet and lacking any sense of control. Thanks to increasing market transparency and a growing array of choices, this longstanding disadvantage is gradually changing, and consumers’ expectations are rising accordingly.
In 2012, 43% of consumers were already purchasing insurance through a retail model, akin to selecting products off the shelf; based on current insights, this proportion is projected to rise to 55% by 2017.
Future medical options will extend far beyond traditional, standard pricing models. Personalized services tailored to consumer needs will generate substantial value in the future. Although surveys indicate that price remains a primary consideration, particularly among older adults, non-price factors such as brand reputation, service quality, and network coverage also carry significant weight.
Companies that focus their services on a specific niche can rapidly address consumer dissatisfaction with their experience, establish their market position, and win the loyalty of discerning customers.
Love at First Sight with Private Transactions
51% of respondents reported high satisfaction with their transaction experience, while 53% felt confident during the process. Compared to other groups, younger and healthier consumers exhibited higher confidence levels (57%) and broader satisfaction (55%). Due to the overall high satisfaction rate, approximately 66% of consumers expressed willingness to continue choosing the same insurer in the coming year. An additional 20% showed some degree of loyalty. This proportion was highest in private transactions, where 75% of respondents indicated their intention to remain with their previous insurer. Only 10% expressed a desire to switch providers. This finding suggests that consumers respond more positively when granted greater autonomy and choice. In other words, capturing consumers’ trust from the outset yields greater long-term benefits.
As consumers explore their own choices and adapt to transactions faster than experts predicted, it is imperative to rapidly provide them with more market options. Digital transformation is advancing at an astonishing pace. If consumers are just beginning to develop loyalty toward their insurer brands, it is not too late to win their hearts now.
One size does not fit all.
Survey data reveal several trends, the most prominent of which is a divergence in choices among consumers from different socioeconomic strata. For instance, the vast majority of older and wealthier individuals do not alter their decisions based on price considerations, whereas younger, healthier consumers tend to factor price into their decision-making process. Among respondents aged 65 and above, the key determinant influencing their decisions is the provision of compelling recommendations. More than half of those under the age of 25 are willing to choose new hospitals over well-established ones, even if the former have lower rankings. In contrast, this proportion stands at only 16% among individuals aged 65 and older. There is also a marked age-related disparity in attitudes toward telemedicine: more than four out of five people under the age of 35 are willing to accept healthcare services offered in virtual markets, while 47% of older adults strongly dislike this idea. Younger consumers are demonstrably less loyal and more inclined to obtain information about insurers and healthcare providers through online channels.
Across all consumer segments, credibility, convenience, and value are key indicators of positive experiences and customer loyalty. Credible information and convenience drive 60% of consumer satisfaction and loyalty. Consumers are largely indifferent to what others are doing; nearly all consumers consider whether a product is available in the open market as an insignificant purchasing factor. This data signals the end of the one-size-fits-all service era. The value proposition in the healthcare industry should be consumer-centric. Strategies that treat healthcare consumers as a homogeneous group with uniform quality preferences are obsolete. Value propositions across the entire healthcare value chain must be tailored to consumers, with specific product attributes reflecting the trade-offs preferred by these distinct consumer segments. However, consumers dislike having too few choices almost as much as they dislike being overwhelmed by too many; offering a set of options does not help if it overwhelms them. For instance, while an extensive healthcare system network may be perceived very positively, customers see little added value in further expanding choices beyond a certain point. To leverage consumers’ need for choice, it is crucial to identify and understand their actual decision-making preferences and provide options that are not overwhelming.
Internet channels are more popular among young people.
Despite notable differences among consumers across various age groups, a clear trend has emerged: younger consumers prefer to obtain information about their insurance providers and healthcare service providers through online channels. Respondents under the age of 45 believe they are more inclined to engage in health management via digital methods, favoring these over traditional in-person consultations and telephone inquiries. This presents a significant opportunity for health plan providers, suppliers, and employer-sponsored health programs to establish continuous and effective communication with consumers. By offering ongoing services at lower costs, it is possible to maintain users’ physical well-being while encouraging more active participation in their own health management, thereby reducing overall expenses. Companies with keen market insight will leverage predictive analytics to deliver content aligned with consumer preferences and promote healthier behaviors.
Comprehensive Patient Care
36% of consumers rely on “healthcare extenders,” such as family members, support groups, online communities, and other individuals not directly affiliated with healthcare providers, to help them manage their health. Approximately half of the respondents admitted that it would be difficult for them to maintain a healthy lifestyle without the support of these groups. Interestingly, this finding differs from other data, showing little variation across different age and income groups. Consumers are also seeking more resources to help them make decisions regarding healthy lifestyles, such as friends, family, social workers, and online networks. Effective communication with them requires the adoption of a comprehensive care model, wherein healthcare providers, payers, healthcare extenders, and government agencies collaborate to gather information and provide encouragement to consumers. Many costly healthcare decisions are made by consumers in hospital settings; issues such as delayed disease management and persistent smoking are often beyond the direct control of healthcare service providers. By collecting and leveraging data generated at home and harnessing the power of consumers’ communities, healthcare enterprises can help improve consumers’ quality of life while reducing costs.
The Emergence of the Healthcare Consumer
In the new health economy, consumers are willing to embrace novel, non-traditional solutions to meet their healthcare needs. This indicates that the market is also ready to welcome new entrants. Forty percent of consumers say they would trust large retailers like Walmart or Target to manage their health; 39% are willing to choose healthcare providers; 37% prefer insurance companies; and 33% are open to selecting internet giants such as Google and Amazon. The primary reason people choose non-traditional enterprises is their belief that they can obtain the same services at lower prices from these companies. This trend serves as a wake-up call for traditional players. Companies like Target and Amazon already possess substantial capabilities in data analytics and disruptive DNA technologies. More importantly, consumers can enjoy more efficient and satisfying user experiences with these firms. As the market continues to expand, these new entrants are gradually capturing share in the health sector. Insurers, providers, and other industry competitors must adapt by offering greater choice, engagement, and improved experiences aligned with consumer demands if they wish to maintain their position in the market.