The CMO's Role in Delivering Customer-Centric Healthcare

As patients begin to demand a higher level of customer service, the shift to consumer-focused healthcare is forcing healthcare industry leaders to adapt. In this first of a series, Nick Christiano, national managing partner for healthcare at Tatum US, discusses how that shift is affecting chief medical officers.

The healthcare industry continues to exist in a state of flux, as the Affordable Care Act, new regulations, and market forces impact how care is delivered. In fact, one of the biggest trends impacting the industry comes directly from patients themselves as they demand a higher level of customer service. No longer content with the same old process of signing forms, waiting excessive amounts of time to see the doctor, and being left in the dark about their bills, today’s patients expect a more consumer-friendly experience that is positive and transparent and keeps them informed throughout.

So, what can healthcare organizations do to meet this new demand for customer-centric healthcare? The onus lies on leadership — the CEO or chief medical officer (CMO) – to drive these changes, deliver a more patient-friendly approach, and optimize cost structures. Doing so will improve the patient experience and ensure the continued success of the organization in this new age of healthcare.

Meeting Patient Demands

Healthcare organizations recognize that the consumer-driven model of care has become the norm rather than the exception. This point is made clear in a study by the National Research Corporation asserting that customer-centric healthcare cannot be uncoupled from the important issues of today, such as population health management, promoting prevention and wellness, and improving quality of care while reducing costs. Ultimately, it is the customer who will decide success or failure of these strategic issues.

And many organizations are responding to this need to provide a more customer-centric model, as revealed by a recent survey by PricewaterhouseCoopers. The survey found that that the majority (89%) of healthcare CEOs plan to improve their ability to innovate, a greater number are planning to change their technology investments (93%), and a total of 95% are exploring better ways to use and manage the data available to them. Despite these positive signs, the study found that very few healthcare leaders have actually made headway in these areas. What is it that CEOs and CMOs can do to introduce such fundamental change into their organizations? At the most basic level, they must implement the strategies that minimize wait time and maximize the customer experience, and provide patients with greater options in how they receive care.

But that’s not the only area in need of improvement; cost structures are also due for an overhaul. Up until recently, most hospitals would determine the cost of service based on their Medicare Cost Report, formulate an appropriate margin, and use that as the basis for their pricing structure. In addition, diagnostic-related groups (DRGs), using data from across the nation, would determine the appropriate reimbursement for that procedure. The actual quality of service provided had no bearing on cost, especially since there was no standard approach for measuring the quality of care received.

However, with the advent of new technology and the Quality Initiatives contained in the ACA guidelines, it is now easier than ever to collect clinical informatics, access national registries, and determine quality indicators and measure analytics for quality — all factors that impact the reimbursement side of the equation. Today, the issue for many providers is that their cost structure needs to come down considerably, with pricing determined by performance and the quality of service provided, rather than being contractually guaranteed. Factoring customer engagement and satisfaction into the reimbursement structure will help drive the shift toward a more customer-centric model.

The Best Path Forward

Implementing such a monumental transition won’t happen overnight; it requires strong leadership to set the tone and ensure the right resources are in place to drive these changes. As such, the CEO or CMO must take the lead, working with other leaders across the organization to ensure alignment throughout. This includes full collaboration with the CIO to identify the technologies and system needed, and the chief nursing officer to ensure nurses deliver an optimal bedside manner.

This is just the start on a long path toward making healthcare more customer-centric; to truly deliver, CEOs and CMOs should consider the following steps to foster the experience today’s patients increasingly demand:

Meet patients where they are. Healthcare consumers will increasingly expect the same level of service they receive in other areas of life and business. This entails making healthcare more like a concierge service, with a higher level of flexibility in how, when and where patients can meet with physicians, such as by offering extended hours, home visits, or tele-health consultations.

Set the tone for employees. Such large-scale changes require strong leadership at the top to see initiatives through and provide guidance throughout. CEOs and CMOs must work with other C-suite executives to identify what needs to be transformed, communicate why those changes are needed, determine the tools that will facilitate the transition, and advise on how each employee can contribute to delivering customer-centric care.

Revamp cost structures. To meet patient expectations, CEOs and CMOs must deliver on two key objectives — to keep patients healthy and provide service at reasonable costs. For many organizations, this means designing a fundamentally different operating model and driving down costs for activities that do not produce value while providing higher quality care to their target patient population.

Seek outside help when needed. Healthcare leaders might not have all the senior-level support and capability necessary to guide their organizations through such a large transformation. Leveraging the help of an executive talent provider to ensure the organization has the support and expertise to deliver a more customer-centric experience can make all the difference.

An Effective Approach to Delivering Customer-Centric Care

As patient expectations continue to evolve, healthcare providers must be able to keep up and deliver on new demands; increasingly, this means making the entire process more similar to the consumer experience. As the implementation of the ACA has given people more access to healthcare, and more choices in how they receive that care, CEOs and CMOs must reconsider current practices and identify ways to change and provide higher quality service at lower costs.

In an age of rapid innovation, characterized by more empowered patients, increased competition, merger and acquisition activity, new service delivery models and other factors, healthcare leaders must be able to deliver a transformative vision throughout their organizations. This entails showing what the future operating model will be and how to get there with the best tools, technology and team. With the right leadership and personnel in place and the right technology to facilitate the transformation, healthcare organizations will be well prepared to deliver a more customer-centric healthcare experience.

Editor's Note: This is the first of a series by Nick Christiano, national managing partner for healthcare at Tatum US, on the changing roles of healthcare leaders. Christiano sat down with Physician's Money Digest to discuss this topic for a video series. The first videos from that series, focusing on the changing roles of CEOs and physicians, follow below.

Nick Christiano is responsible for the overall execution of the National Healthcare Practice for Tatum, a Randstad company. The Healthcare Practice provides executive leadership solutions to healthcare provider organizations, heath plans, private-equity backed bio-tech firms and affiliated organizations where subject matter expertise is critical to a successful client engagement. Christiano is recognized as a driven leader, tireless in the pursuit of optimum patient care, productivity, efficiencies, cost management and navigating the new challenges in the healthcare field. He has an MBA in MIS/Finance from the John Hagan School of Business — Iona College and a BS with a dual major in Computer Science/Electrical Engineering from NYIT He can be reached by email at Nicholas.Christiano@Tatum-US.com