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Consumerism in Healthcare: A Look to the Future
Blog Feature
Robby Shaul

By: Robby Shaul on December 4th, 2023

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Consumerism in Healthcare: A Look to the Future

CMS & Transparency  |  defensible pricing  |  strategic pricing

In the near future, hospitals will compete for business just like other service industries, i.e., restaurants and retailers, to name a few. For example, consider how someone finds the best speaker to buy on the market. They go online and compare prices, specs and quality. Knowing this information, they can then decide whether they will choose a certain speaker or not. For years, healthcare was immune to this level of consumerism, but since the push for stricter price transparency laws in healthcare, the consumer now has all the information they need to choose your hospital or not.

The truth this change brings is that consumerism isn’t going anywhere. In fact, it is only going to get ramped up. As it will affect their bottom line, hospitals should take this seriously and plan to align with consumer demands and expectations. 


Healthcare consumers are increasingly demanding tailored experiences. They aren’t loyal customers. On average, patients in the U.S. split care across an average of four to five different provider networks each year. Generally speaking, they’ll see whoever can book their appointment the fastest, offer solutions, and provide a frictionless experience. Furthermore, consumers are also driving a digital transformation, and if embraced, this can create efficiency for hospitals and even alleviate staff pressures.

Hospitals that innovate their business models to align with consumerism in healthcare will gain a competitive edge, both in attracting and retaining patients and inefficiency. As the digital age advances, embracing these changes can also lighten the load on staff.


The Significance of Positioning for Hospitals

Consumerism in healthcare demands an evolution of the healthcare sector toward treating patients as discerning consumers. Under the traditional model of care delivery, doctors primarily influenced medical decisions. However, the new approach aligns healthcare services with retail dynamics: choices, preferences, and the ability to “shop around.” 

To thrive in the new healthcare ecosystem, hospitals must prioritize brand positioning, a term that refers to the unique value propositions that facilities present to patients. That value may be convenience, reduced wait times, better care quality and customer service, or decreased costs. 

For a hospital to thrive in a consumer-driven healthcare space, intentional positioning offers opportunities to: 

  • Differentiate a hospital from competitors. 
  • Manage their digital reputation, building trust and credibility. 
  • Effectively reach the right market for services with the right messages  
  • Ensure a positive patient experience with the first exposure to your brand. 
  • Grow the hospital’s market share. 

As such, brand positioning has become critical due to the competitive environment in which hospitals now find themselves.  


Typical Positioning Models

Hospitals, like any other business, need robust brand strategies. Some standard models that hospitals can leverage include the following: 

  • Preeminent Brand: Being a preeminent brand is about presenting a top-tier image — think Cleveland Clinic, with its state-of-the-art technology.
  • Trusted Brand: Reliability and ethics are of paramount importance when implementing a trusted brand strategy.
  • Convenience Brand: Just as Amazon prioritizes accessibility, some healthcare providers offer extended hours, telehealth, or online scheduling. 
  • Value Brand: Hospitals that embrace this model focus on providing unbeatable value, like Walmart. 
  • Innovation Brand: Innovative hospitals are always on the cutting edge, like Tesla.

For instance, a hospital may find itself choosing between options like becoming a convenience brand or a value brand. To appeal to their target demographic, hospitals may have to decide between giving their patients two options. Option #1 is to save money while accessing quality care, or—Option #2 is to select a convenient hospital to fit around their work schedules.  

Overall, the hospital’s directors must decide which positioning model resonates with their target audience and align all decisions — from equipment purchases to staffing — with their chosen strategy. 


Current Trends in Healthcare Consumerism

Several dynamics have emerged in response to the evolution of consumerism in healthcare. Most notably, patients expect personalized care experiences. They want providers to make the entire experience about their unique needs so they can get tailored care and support.

Hospitals are also emphasizing transparency and integrity. CMS price transparency laws have prompted the upfront disclosure of healthcare costs. As a result, the patient is empowered to make more informed decisions by comparing prices and determining which services to prioritize.

Another trend is the accelerated adoption of telehealth services, which started during the COVID-19 pandemic. Telehealth visits accounted for roughly one-third of outpatient interactions in April 2020. While this has since stabilized to a range of 13%–17%, telehealth is still an integral aspect of the modern healthcare ecosystem. 


3 Ways to Seize Opportunities in Rising Healthcare Consumerism 

Hospitals and providers should take the following steps to seize the new opportunities that have resulted in the consumerist age of healthcare.

1. Educate Patients 

With consumerism at the forefront, hospitals can redefine patient care. It’s not just about treating ailments but engaging patients in their health journey. Patients are increasingly interested in knowing exactly what they owe for their care, what quality of care they are receiving, and what financing options are available for them. Educating patients on these aspects is crucial to building trust and transparency, as well as helping them make informed decisions about their healthcare. By providing clear and concise information on pricing, quality, and financing options, hospitals can build a positive reputation and relationship with their patients, leading to increased loyalty and retention.  

Additionally, this can help hospitals stand out in an increasingly crowded marketplace, as patients are more likely to choose a healthcare provider that is transparent and informative about their services. 

2. Align Pricing Strategically with your Brand

Hospitals are now competing for patients like never before and are looking for ways to align their pricings accordingly. One approach is to leverage certain services as a loss leader. This means that your hospital may provide certain services at a lower cost than its competitors in order to attract patients. For example, a hospital may offer free primary care or low-cost screening to promote their services. Alternatively, hospitals may also decide to discontinue certain services that do not bring them enough patients. This approach can help hospitals to optimize their offerings and focus on what works best for them and their patients.  

To accomplish their goals, hospitals may need to change their charges or negotiation strategy or even do some of both. Hospital charges can vary widely depending on a range of factors, such as location, hospital size, and the services provided. Some hospitals may need to restructure their charges to make their services more appealing to patients. For instance, they may offer bundled pricing for certain services or negotiate directly with insurance companies to lower costs. Ultimately, your hospital can offer high-quality care at a reasonable price while also providing a personalized experience for patients.  

These steps will ensure your organization’s success in today's competitive healthcare landscape. 

3. Consider Alternative Payment Models 

Embracing innovation can significantly enhance both the patient’s experience and operational efficiency.  

As consumerism continues to rise, hospitals may need to consider alternative or creative payment models to stay competitive. Some of these options include:  

  • Bundled payments involve paying a single payment for an entire episode of care, from diagnosis to recovery.  
  • Shared savings programs incentivize providers to reduce costs while maintaining quality care, with savings shared between the provider and payer.  
  • Accountable Care Organizations (ACOs) are groups of healthcare providers that work together to manage and coordinate care for a specific group of patients, with the goal of improving quality and reducing costs.  
  • Direct-to-employer contracting involves hospitals contracting directly with employers to provide healthcare services to their employees, cutting out insurance companies as a middleman.  

Overall, hospitals that are willing to explore these alternative payment models may be able to attract and retain patients by offering more affordable and efficient care. 


Embracing Consumerism in Healthcare

The transformation brought on by consumerism is undeniable. As patients become more informed and discerning, hospitals must transition from mere treatment centers to holistic healthcare partners. 

By embracing patient-centric approaches, leveraging available technologies, and focusing on providing exceptional experiences at every touchpoint, hospitals can thrive in this new environment and set new standards of care. The future of healthcare is here, and it is unmistakably consumer driven.