Key strategies to combat market disrupters in healthcare

In the last three years, market disrupters in healthcare have increased their activity and deepened their presence. Although they bring about change, not all market disrupters are negative. Using the strategies discussed in Market Disruption: Threat or Opportunity, we’ll walk you through nine tactics to help you leverage disrupters.

What are market disrupters?

Market disrupters are defined as any person, product or idea that radically and permanently changes the way an industry operates, according to Western Governors University. Healthcare market disrupters use multiple strategies to address challenges like physician burnout, patient satisfaction and electronic health record shortcomings.

While not all disrupter solutions succeed, new care models and technology-enabled value-based care platforms have gained traction. Currently, hospitals and health systems are tailoring their strategies to reflect:

• disrupters’ prime targets;
• current service strength and diversity; and
• local market dynamics, including value-based care acceptance and progress.

How to combat healthcare market disrupters     

Understand your disrupter

Healthcare disrupters are gaining in-depth patient insights, developing care models to meet their needs and creating a better customer experience. Here are three ways you can better understand your disrupter.

1. Know your competition

• Big tech: Amazon, Microsoft, Apple and Google have leveraged their data depth.
• Payors: UnitedHealth Group-owned Optum and Humana have a footprint in post-acute care.
• Retail: CVS Heath, Walgreens Boots Alliance and Walmart have acquired and partnered with payors.
• New medical groups: The names matter less than the new models of care they represent — primary, specialty and VBC.

1. Know the threats they represent
   Big tech data help predict patient needs. Payor home-based resources steer patients and their care. Retail settings have evolved beyond low-acuity convenience care to VBC models. New medical groups include provider-payer partnerships that deliver concierge care to seniors.
2. Know if they’re in your market
   Sg2 data shows that payviders are the largest disrupters in New York City while investor-backed medical groups have grown in the state’s other urban centers like Buffalo and Syracuse. In rural areas, all four disrupter groups have grown their presence.

Understand your market

Disrupters like Amazon can already execute a seamless customer experience. Now they want to convert customers to patients just as easily. Size and scale allow CVS to mirror system-level capabilities as a provider and a payor. Here’s what you can do using your company size:

1. Align better with patients
   Sg2 notes that health systems often lose as many patients as they gain. Their data shows a four-year health system market share at approximately 33% with 15-20% customer churn. The latter includes a 25-40% churn rate for new customers. This patient leakage can cost organizations $200-500 million per year.
2. Align differently with physicians
   Physicians have more partnership options and will pursue them if they can solve long-standing problems. AI-driven EHR solutions from disrupters have increased chart speed, accuracy and detail.
3. Align clearly with VBC
   Health systems must be on a path to value-based care or have a good reason not to be. The new medical group investors have made these pathways easier for physicians, including risk-based contracts.

Understand your data

Healthcare problems aren’t always simple to fix, especially without the right intelligence. Focus on your data in these three ways to better understand it:

1. Evaluate metrics
   Look at traditional performance metrics but apply a broader lens to measure and improve customer engagement. Start with visit volume, unique patient count, inpatient market share and per-visit revenue. Then ask yourself, “How effectively do we attract and retain patients?” and “How well are we serving their needs, now and over time?” 
2. Re-evaluate service lines
   Identify a service line or lines that might be at risk. Next, apply the metrics and run if/then scenarios to strengthen market position or make partnership decisions.
3. Assess the results
   A better understanding of patient acquisition, leakage and revenue impact lays the foundation for a more frictionless customer experience — the one that disrupters already know how to create.

3 questions to get started

Disrupters are accelerating their activity, growth and success. Hospitals and health systems must respond now. Taking what you learned above, here are three questions you can ask to get started:

1. Which disrupters are most active in your market and which new care models and technologies have they introduced?
2. Do you know how to accelerate your market performance using all available levers?
3. How will you apply data to your care redesign strategies to meet changing patient needs?

Don’t want to analyze your health market position and current disrupters? DataGen’s partnership with Sg2 allows you to leverage a robust suite of tools. Use Sg2’s MarketEdge market and referral pattern analyses to better understand your health system’s market position based on historic utilization, demographic data and other user-defined specifications, such as geographies and hospitals. Contact DataGen today to learn more.