Thomas E. Catanzaro, DVM, MHA, FACHE, Diplomate American College of Healthcare Executives
The average consumer today wants options. Price is obviously only one element in the purchasing process. It has been found to be critical only when the healthcare consumer does not have a strong preference for a hospital. If the quality of two providers is perceived as similar, consumers will then match price against other attributes to determine which combination provides the most value.
Based on market research of potential healthcare consumers, price was ranked tenth in importance among 14 variables (in veterinary medicine, it was listed at #9). Instead of price, potential healthcare consumer looked at factors such as doctors, support staff, facilities, courtesy, convenience, modern equipment, services, and other physical indicators (in veterinary medicine, it was caring, informative, knowledgeable and attentive provider). While most consumers don't see paying less as a trade-off for quality or amenities, they do have a price range in mind. In the veterinary community, the numbers are similar to those in human healthcare. Veterinary client research (The Pet Connection, by CENSHARE, University of Minnesota) has shown that $250 to $300 (circa 2001) has risen to $650-$750 (circa 2007) as the current decision point for about half the clients; up to that point, "Do what you need to fix our pet" is usually a true statement. After that point, discretionary spending pressures come into the equation to off-set the values associated with the human/animal bond.
Today's client makes assumptions about both hospital price and quality. The human healthcare researchers revealed that consumers believe that quality varies between hospitals. They have also found that most clients generally relate higher price to better care. These values have been reflected in the Pfizer studies of 35,000 to 37,000 veterinary clients three years in a row (turn of century) and more recently, in AAHA surveys of client opinions.
Perceptions of Price vs Quality
The research on the client's perceptions of price in human healthcare are intriguing:
Only 17 percent ever believe they had a low-priced hospital; the majority views their hospital prices as the same or more than other hospitals in the area.
One-fourth report that hospitals with low prices lead them to believe that it is also of lower quality.
Three out of ten believe if they pay more they will receive higher quality care.
Over half of the consumers are willing to pay higher prices to receive care from a hospital they view as offering the highest quality health care.
Four out of ten healthcare consumers report they would prefer a hospital with an image of good quality and low price to a hospital with an image of high quality and high price. They also don't feel technical quality is an issue among these hospitals.
A Lesson in Veterinary Communications
By tapping educational resources once limited to students, veterinary professionals are reaping the rewards of the latest in veterinary communications with hands-on training and consulting services from university professors. These are not the rank and file veterinary clinics, say communications professionals in Colorado who offered a pilot program in 2006-07 and may soon offer the program to other clinics. Veterinarians who are interested in this intensive training recognize the importance of good communication and know that while their investment may not show immediate, bottom-line results, it will pay off through improved patient care and staff retention. Earlier this month a Colorado-based veterinary hospital completed a pilot program that tests academic theories in private practices. Positive results from a year-long consultation between Firehouse Animal Health Centers and the Argus Institute at Colorado State University may prompt a regional rollout of the communications consultation program. It also marks an expansion of services offered by the Argus Institute, which previously focused on end-of-life communication for veterinary students and pet owners.
The Firehouse Project, which was funded by the hospital, Hill's Pet Nutrition, Pfizer Animal Health, and CSU, marks the first time that Argus has worked intensively on-site with a veterinary clinic on veterinarian-client-patient communication, said Jane Shaw, DVM, PhD, director of the Argus Institute. Shaw, who has published much of her extensive research into the field of veterinary communication, was able to implement communication theories within a clinical setting. "It's so rewarding to work with a practice so in-depth and to see [effects of the] program over time," Shaw said. "It's some of the most fulfilling teaching you can do."
With five veterinary clinics and an aggressive expansion plan in place, Firehouse owners wanted to surpass industry benchmarks of patient and client care, which is why they sought out industry experts, said Jed Rogers, DVM, co-owner. Referring to Shaw and partner Gwyn Barley, PhD, director of the University Colorado School of Medicine, Rogers said they "understood our issues better than any veterinarians we had talked to. I knew right away that this would help us out tremendously." Although owners value high-quality service and teamwork, Rogers quickly realized that they had merely scratched the surface and that implementation of Shaw's suggestions would yield results.
During the program, Firehouse outpatient veterinary nurses (in Colorado, only certified/licensed technicians can be called technicians, so Veterinary Nurse, as used in the UK, NZ, Australia, Europe and South Africa, was the alternative term used) learned new intake/admission procedures using open-ended client questions that facilitate information sharing and honed their ability to convey data before doctors entered the consultation room. Outpatient Nurses, who spent 3-5 minutes doing the asymmetry exam before the doctor, and 3-5 minutes of client education and medication administration after the doctor has prioritized the healthcare program(s), previously thought that clients saw them as middlemen instead of valued team members. By emphasizing the value of effective information gathering that perception changed, Shaw said. "It takes a team to serve a client," she added.
From Outpatient Nurse to inpatient technician to veterinary doctor, the switch to open-ended questions like, "Tell me what you observed" is scary, Rogers said. "You think, 'oh my God, I'm going to be stuck in the room for 50 minutes with this client,' but [if you use this technique] you actually spend less time with the client." More importantly, Rogers said, you obtain more information, which expedites diagnosis. "You get a more complete list [of signs/symptoms] from the get-go by letting the trained outpatient nurses (great communicators) or inpatient technicians (usually the CVTs [certified veterinary technicians]) and clients do that work, which for us as doctors is hard to let go of," he added.
Research conducted by Shaw shows that open-ended questions encourage honest dialogue with clients and better information sharing whereas closed-ended questions solicit short, limited replies. "From research done in the human medical field, we know that it is therapeutic to tell a story and have someone listen to you," Shaw said. As a result, she suggests that veterinary professionals ask, "What would you like to accomplish today?" when clients arrive for their appointments, or if there is a specific problem, focus on a general, open-ended question about the ailment. For example, "How has the dog's behavior changed?" or "What did you see?" instead of "What color was the vomit?"
Shaw compares using closed-ended questions to throwing a dart at a board. You will get an answer to the targeted question, which may or may not pertain to the diagnosis. On the other hand, throwing a wider net with your question may result in several pieces of information that could clinch the diagnosis. In essence, the approach alleviates pressure from doctors. "It's a lot of work on the veterinarian's part to ask the right questions," Shaw said. Shaw and Barley, who coach medical students on client interactions, have been approached by other clinics about the new consultation package, which is similar to the communication curriculum offered to third-year students. The pilot project included about 100 hours of on-site training with the practice team, Shaw said. Every staff member was involved in the consultation training process, which ranged in scope and in price from $200 an hour to $60,000 for a six-month contract. The year-long program is available to other veterinary clinics that meet specific criteria, including geography (proximity to CSU), university resources, and use of a customer intimacy model designed by Michael Treacy and Fred Wiersema (www.12manage.com/methods_valuedisciplines.html as well as www.12manage.com/methods_customer_relationship_management.html). The management method shows that successful client relationships are based on a partnership, the ability to work together to reach a common goal, Shaw explained.
The Customer Intimacy Approach
Work hard as a team to identify, attract, build and sustain relationships with your clients and partners. Take pride in knowing that the relationships being built are long-lasting and sustain the organizations competitive advantage in the community.
Always deliver excellent value by building on each of the existing relationships and continuing to use what you know about your clients to help them make better business and policy decisions. Work hard to get to know your clients and their unique concerns, wants and needs so that with thought and caring, you can identify how to best serve them. When teaming with our partners, focus on leveraging strengths to make the relationship most effective for our mutual client.
Detailed information about Customer Intimacy, a term coined by Michael Treacy and Fred Wiersema, can be found in their book, The Discipline of Market Leaders.