This article was published in IAOP Pulse magazine.
By Anand Natampalli, HGS Senior Vice President, Sales and Business Development, Healthcare
Blink and you’ll miss the latest landscape shift in healthcare delivery. In terms of affordability, access, digital capabilities, and engagement — consumers are consistently upping the ante. As a result, health plans and health systems such as hospitals, physicians’ offices and urgent care centers are turning to outsourcing partners to handle critical processes to compete and thrive in the changing market.
Macrotrends to watch
From health reform to consolidation and today’s in-control, informed consumer, here are four macrotrends at the heart of the market shift:
- Market consolidation: The recent surge in healthcare merger and acquisition (M&A) activity is leading to significant market consolidation, particularly among health organizations. And as the healthcare industry keeps a sharp focus on efficiencies and better outcomes, health systems and health plans alike are hoping to achieve economies of scale, better lifecycle control, and top-line growth. With antitrust challenges presented to horizontal integration plays, larger healthcare organizations are increasingly looking to bring new capabilities to the table with vertical integration, for market power and leverage. Optimized vertical integration requires service and specialization focus all along the continuum.
Through healthcare consolidation, organizations can control more aspects of the treatment/payment processes, allowing them the opportunity to bend the medical cost curve and drive out wasteful spending/effort. Faced with the heightened prioritization of customer needs, experience, and value stream impact, these merging health organizations are increasingly turning to BPOs that can bring strategic insights, optimization, and efficiencies to achieve this operational focus. These vendors can address duplication of effort resulting from consolidation and bring cost reduction and innovation while helping both the health system and health plan achieve their financial goals. Additionally, when sourcing for a new partner, it’s important to find a vendor that can provide services across the entire healthcare spectrum to ensure future state alignment. These aspects will ensure easier integration across new capabilities, from a sourceability perspective
- Vendor consolidation: Healthcare BPO partnerships are evolved today and speak to the dramatic shifts in how the industry is assessing vendors, and also to the maturity of healthcare’s adoption of these resources. And healthcare is navigating disruption on several fronts, as BPOs are themselves following the path of health systems and health plans with their own movement toward consolidation. In doing so, these vendors’ strategy is aligned with their clients. As health plans become more diversified in their offerings to their customers, vendors must follow suit to offer additional capabilities and truly become end-to-end service providers that deliver additional value outside of traditional BPO engagements. This falls naturally in line with the BPO’s new business imperative: the market differentiation required to set services apart in a tight market space. BPOs are now driven to the consolidation of service — with a greater occurrence of multi-vendor environments – while trying to remain less as commodity players and more domain-centric service providers. Bots, for example, can be provided by the one-stop shop BPO, which can combine robotics and BPO traditional customer care services, all at once. This solution used to be a horizontal play as a front- or back-office standalone. Today RPA has evolved to become a more specialized, practice-based service capability, and a good BPO can bridge delivery with the required and unified technology and services support. Consolidation at the vendor level brings more opportunities for market differentiation. From process reengineering to bot capabilities, vendors are merging to provide more specific capabilities, processes, and platforms.
Tech space services, for example, enable a BPO to own more client outcomes, rather than merely delivering transactions. This change has also brought more capable vendors to the market where they can blur the lines between contact center, back-office, and technology offerings. The vendors that have the ability to understand the ecosystem will be able to provide the most value to their customers, as they truly understand the upstream and downstream process impacts and can offer superior client value.
- Healthcare consumerization: Today’s engaged and empowered consumers are, more and more, becoming a collective and vocal barometer of market expectations and how delivery measures up. These member-patients are shouldering a larger responsibility of their own healthcare payments, and they expect an experience which is in line with their investment. Health plans and health systems have to simultaneously cater to engagement and retention of two opposite ends of the customer spectrum— from the aging population to digital natives, those millennial-and-younger customers who will choose digital channels for service delivery, whenever possible.
Healthcare has, undoubtedly, made strides toward more consumer-centric, 24/7 optimized experience—from nurse triage to Customer Relationship Management (CRM), case management, and Personal Health Monitoring (PHM) solutions. BPOs can bring market-leading customer experience expertise from B2C leaders like retail and banking to optimize the experience and improve care access with preferred consumption channels—from online reputation management to telehealth. Their understanding of upstream and downstream impacts will also assist with driving efficiencies and cost-saving opportunities. As a virtual extension of healthcare client operations, these partners will carry the customer-centric solution thinking that has led other industries to CX success.
- Healthcare regulatory and model changes, uncertainty: The stakes have been raised for the Affordable Care Act and there is uncertainty regarding the future states of healthcare, healthcare delivery, and healthcare payment. We’re at a watch-and-wait point in terms of whether the government will play a bigger role in healthcare. But one thing is for sure: Healthcare stakeholders will be challenged to continue to uphold the volume-to-value transition, in a continually changing environment.
In the case of credible healthcare BPO organizations with reach and a diverse client base, they not only have a practical comprehension of the broader federal regulations but also benefit from the granular knowledge of state-driven certification requirements and understand the implications of conforming to these regulations. As expert problem solvers across a diverse client base, they have the best exposure to understanding the nuances of regulations and how they can affect business from an end-to-end perspective.
A 360-degree view provides value in engagements
Ultimately the right healthcare BPOs can help healthcare organizations navigate these key market changes, from delivering brilliant-at-the basics differentiation to driving business process transformation and creating value with solutions like automation and analytics. Those BPOs with a 360-degree view of the healthcare ecosystem with both health system and health plan expertise are also uniquely suited to bring health systems, patients, and customers together as a digital community that shares holistic consumer insights to drive better care quality and operational outcomes.