Do you remember the last time you walked into Blockbuster to grab a DVD for the weekend? And what was it like doing real estate before Zillow and Redfin? Or shopping prior to Amazon?
Twenty years ago, I was entering my teen years as a Blockbuster stood on every corner and Amazon was competing for its niche as an online bookstore. Times have changed… but does this level of disruption and pace of change have any application to healthcare?
There is no question-technology advancements and a generational shift of consumer attitudes is driving a tremendous amount of change in how we receive goods and services.
Millennials (people born between 1981 and 1997) are now the largest generation in the United States, having recently surpassed baby boomers for that title. Overall, they represent a very different consumer. They demand immediacy, more empathy, and far greater transparency than prior generations. They think in terms of convenience, personalization and experience.
I can relate. After all, I am a millennial. And at Premera Blue Cross, we are working to understand this emerging customer base and adapt to their needs.
A consulting firm, Accenture, recently examined what millennials are looking for in their health insurance and why they would switch plans. Here are a few of the most notable takeaways:
- Only 22 percent of millennials cited value for money as a key reason for switching insurance companies compared to 46 percent of baby boomers.
- Less than a quarter of millennials who switched issuers said insurers could have “offered me better pricing” to keep them as a customer. In contrast, nearly three quarters of baby boomers (74 percent) would be wooed by better pricing.
- Half (47 percent) of millennials who switched issuers answered “resolved my issue(s) on first contact” as something that could have been done differently to keep them as a customer. Only 15 percent of baby boomers would switch for the same reason.
- “Member service representatives who aren't knowledgeable” is a reason for 37 percent of millennials to switch insurers, compared to just 3 percent of baby boomers In general, millennials feel they aren't getting the service they deserve. Only 32 percent of millennials feel they are treated well in the healthcare system, compared to 51 percent of baby boomers.
As millennials (and younger generations) become the largest proportion of healthcare consumers, these survey results and our own consumer research suggest business as usual will not suffice.
Healthcare strategies must address emerging consumer needs that push us into new ways of doing business while retaining a focus on the full 2 million consumers across the country that rely on Premera for access to health services. Along these lines, a few key activities at Premera are underway:
- Premera is building a new customer experience. We are listening to the customer in a direct and meaningful way through Premera Listens.
- As part of our recruiting strategy, Premera is reaching into a vast millennial talent base, drawing from a strong local technology presence, to help us deploy new personalized approaches to healthcare.
- Premera's individual market products now come with enhanced digital tools to help customers find a doctor and ensure they are receiving the best value consistent with their benefit design.
- Premera is engaging with current and future customers online and through a variety of social media channels. We want to be available to our customers when and where they need us and through whatever communication method they prefer.
At Premera, we're transforming our hiring practices, market strategies and digital platform while asking a few fundamental questions that shape our next steps:
- How do we want a new generation of health consumers to experience Premera 7 to 8 years from now?
- How will we show up and what do we need to change?
- How will we be passionate advocates and provide the level of service expected of us?
Supply and demand
Industries that are slow to change or address practical consumer needs become targets for massive disruption. Consider the example of ride sharing services. Uber created a digital platform that eliminated the friction between supply and demand and gave consumers a no-hassle, real-time experience - a very sharp contrast from the traditional taxi ride. At the end of that experience, you rate your driver and they rate you - a revolutionary and unsettling disruption for the taxi industry. In 2016, Uber delivered 2 billion rides and grossed $20 billion. 65 percent of Uber's customers are millennials or younger.
I confess, the first time I rode Uber, it was a transformative experience. And now I'm a repeat customer. Not just that, I had to tell my friends and family that they should try it too.
I had become a Promoter - a coveted customer for Uber measured by a Net Promoter Score (NPS) that is driving customer obsession for companies like Amazon, Uber and a slew of start-up healthcare companies like Oscar and Collective Health.
Uber took an opportunity with a digitally savvy and demanding customer base and disrupted an industry that was slow to change and may not fully recover.
Delivering an unexpected experience
At Premera, our success and continued viability depend on creating an unexpected experience for consumers that they would be thrilled to tell their friends about. And that experience has to be flexible enough to accommodate some emerging differences in what our customers value.
This is a journey, to be sure. But one that is being taken at Premera with a sense of urgency and devotion to our core purpose-- improving customers' lives by making healthcare work better.
Nathan Johnson is the Vice President of Strategic Development at Premera.