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    2006 Forecast for Hospitals: The year of Consumer-Driven Healthcare

    January 3rd, 2006

    Well, the new year is upon us. It's time again to look ahead to what this year has in store for us. Here are my predictions sure to go wrong:


    If 2005 was the year of the EHR, then 2006 will be the year of Consumer-Driven Healthcare.

    We all know it's coming, but how much will it advance? I think we will see some major shifts in the industry, namely:

    (1) Patient volume will drop and become more erratic. Since volume was already erratic anyway, this won't matter too much. But, I wonder if this trend will have the net effect of decreasing patient volume, as more financial considerations will come into play. Additionally, will we see a higher case mix as more consumers unknowingly delay treatment?

    (2) "How much does a C-section cost at your hospital?" We will have to field more phone calls from hospital comparison shoppers. Pricing will remain among their primary concern. And they will continue to be frustrated at our inability (for good reason!) to give a straightforward answer. The question is: who wants to be the messenger of "bad" news, telling the public that C-section pricing isn't like movie-ticket pricing? Maybe some hospital associations will try and use various analogies ("just like a grocery store can't tell you how much potato chip costs, just like a car salesman can't tell you how much does a car cost, we can't tell you how much basic medical procedures cost. We can give you a range, but not an actual price.")

    (3) Fortune 100 companies are gonna buy out consumer information aggregators like Subimo and Healthgrades. They will lend their brand recognition and marketing $, and off to the races we will go. If I had $40MM, I'd buy Subimo myself.

    (4) The blurring between banks and health plans will continue. I previously blogged about a new BCBS bank and Visa card - this will reach new proportions in 2006. Banks are desperate for growth opportunities, and HSAs and other health accounts represent a fast growing segment. Maybe not in 2006, but soon, will we be able to submit healthcare expense receipts at our local ATM? Maybe in 2006, we'll be able to keep our unused HSA $$ in our favorite mutual funds.

    (5) The preventative health industry will be (re)born. With more skin in the game, consumers will begin to realize that staying healthy isn't just good for its own sake (which isn't enough to motivate them), it's also good for their wallets (now you're talking my language!). New and old companies alike will play on this sentiment. I wouldn't be surprised if Sir Richard Branson (of Virgin Airlines) and Steve Case (of AOL) make some significant headway with their new healthcare focus.

    (6) Hospitals will become more like hotels. The fight for patient volume / market share will be as competitive as ever. Not only that, the patient experience data will be available to the public. Hospitals will take it to the next level by applying many customer experience/customer loyalty strategies that are so successful at hotels. For example, the lessons of "If Disney Ran Your Hospital" will finally begin to sink in. Hospitals will get better at hospital marketing. And hospitals will increasingly look for patient experience-enhancing technologies and services.

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