Legacy health brands are losing their significance as healthcare consumers place higher value on convenience than reputation. That’s the idea behind a July 1 tweet by Sachin Jain, MD, the CEO of Scan Group and Scan Health Plan.
“We are in an era of the declining significance of big healthcare brands,” he said.
To Dr. Jain, big healthcare brands are the ones commonly known for being the best in a specific specialty or renowned in their region. While many big healthcare brands have high quality performance metrics to hang their clout on, Dr. Jain believes reliance on name alone is problematic.
“There’s been an arrogance by a lot of healthcare organizations that have kind of sold on brand. There’s going to be a reckoning for some of those organizations. My personal view is that the next generation of healthcare consumers is going to be less aligned to think about brands in the same way,” Dr. Jain told Becker’s.
Today’s patients are paying more attention to convenience, digital access and price than reputation. Cost of care, ease of scheduling and accessibility are beating out recognition, Dr. Jain said.
At Scan, Dr. Jain said the Long Beach, Calif.-based Medicare Advantage insurer that serves more than 220,000 members is hyperfocused on staying as human as possible and fulfilling unmet needs for its community.
“Elite healthcare brands are entering this fun phase where they are becoming underdogs. They need to have a chip on their shoulders almost to thrive and perform in this next phase,” Dr. Jain said. “Because I’m not sure payers are necessarily going to continue to pay the same premiums per brand.”
Healthcare is Hard: A Podcast for Insiders; June 11, 2020
Over the course of nearly 20 years as Chief Research Officer at The Advisory Board Company, Chas Roades became a trusted advisor for CEOs, leadership teams and boards of directors at health systems across the country. When The Advisory Board was acquired by Optum in 2017, Chas left the company with Chief Medical Officer, Lisa Bielamowicz. Together they founded Gist Healthcare, where they play a similar role, but take an even deeper and more focused look at the issues health systems are facing.
As Chas explains, Gist Healthcare has members from Allentown, Pennsylvania to Beverly Hills, California and everywhere in between. Most of the organizations Gist works with are regional health systems in the $2 to $5 billion range, where Chas and his colleagues become adjunct members of the executive team and board. In this role, Chas is typically hopscotching the country for in-person meetings and strategy sessions, but Covid-19 has brought many changes.
“Almost overnight, Chas went from in-depth sessions about long-term five-year strategy, to discussions about how health systems will make it through the next six weeks and after that, adapt to the new normal. He spoke to Keith Figlioli about many of the issues impacting these discussions including:
Corporate Governance. The decisions health systems will be forced to make over the next two to five years are staggeringly big, according to Chas. As a result, Gist is spending a lot of time thinking about governance right now and how to help health systems supercharge governance processes to lay a foundation for the making these difficult choices.
Health Systems Acting Like Systems. As health systems struggle to maintain revenue and margins, they’ll be forced to streamline operations in a way that finally takes advantage of system value. As providers consolidated in recent years, they successfully met the goal of gaining size and negotiating leverage, but paid much less attention to the harder part – controlling cost and creating value. That’s about to change. It will be a lasting impact of Covid-19, and an opportunity for innovators.
The Telehealth Land Grab. Providers have quickly ramped-up telehealth services as a necessity to survive during lockdowns. But as telehealth plays a larger role in the new standard of care, payers will not sit idly by and are preparing to double-down on their own virtual care capabilities. They’re looking to take over the virtual space and own the digital front door in an effort to gain coveted customer loyalty. Chas talks about how it would be foolish for providers to expect that payers will continue reimburse at high rates or at parity for physical visits.
The Battleground Over Physicians. This is the other area to watch as payers and providers clash over the hearts and minds of consumers. The years-long trend of physician practices being acquired and rolled-up into larger organizations will significantly accelerate due to Covid-19. The financial pain the pandemic has caused will force some practices out of business and many others looking for an exit. And as health systems deal with their own financial hardships, payers with deep pockets are the more likely suitor.”