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Apr272017

Clicks-and-Mortar: Health Care's Future

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By Kim Bellard, April 27, 2017

 

The woes of the retail industry are well known, and are usually blamed on the impact of the Internet.  Credit Suisse projects that 8,600 brick-and-mortar stores will close in 2017, which would beat the record set in 2008, at the height of the last recession.   And then there's health care, where the retail business is booming.

 

In a recent Wall Street Journal article, Christopher Mims set forth Three Hard Lessons the Internet is Teaching Traditional Stores.  The lessons are:

1.             Data is King

2.             Personalization + Automation = Profits

3.             Legacy Tech Won't Cut It

 

It's easy to see how all those also apply to health care.

 

But health care is different, right?  Patients want to see their physician.  That physical touch, that personal interaction, is a key part of the process.  It's not something that can be replicated over a computer screen.  

 

Yeah, well, the retail industry has been through all that.  Retail once primarily meant local mom-and-pop stores.  They knew their customers and made choices on their behalf.  But it was all very personal.

 

Still, though, when Amazon came along, booksellers were adamant: no one wants to buy books sight unseen!  When that truism was proven false, other sectors of retail had their turn in the Internet spotlight, and the last twenty years of results haven't been pretty for them.  

 

It turns out that the personal touch isn't quite as important as retailers liked to think.

 

So why hasn't health care been more disrupted by the Internet?  Well, for one thing, when you buy a book online, your state doesn't require that you buy it from a bookstore that is licensed by its not-so-friendly licensing board, as is true with seeing doctors over the internet.  

Strike one for disruption.

For another thing, we (usually) trust our doctors.  Then again, we used to trust recommendations from bookstore staff too.  That is, when they had time for us, if they seemed knowledgeable, and if they were making recommendations that fit us rather than just their own preferences.

Think the same thing won't happen when AI 
gets better at diagnoses? 


Let's go back to Mr. Mims three lessons and see how they apply to health care:

·         Data is King: Health care collects a lot of data, and will get even more with all the new sensors.  The big tech companies know their customers very well and tailor interactions accordingly; health care must as well.

·         Personalization + Automation = Profits:, We're stuck in waiting rooms, filling out forms we've already filled out elsewhere. That is not a personal experience that can survive in the 21st century.  It has to be smoother, faster, and friction-less.  

·         Legacy Tech Won't Cut It: EHRs that no one likes.  Claims systems that take weeks to process a claim.  Billing processes that produce bills no one can understand.   The list could go on almost indefinitely.  All too often, health care's tech is not ready for prime time.  

 

The question is, are health care's leaders learning these lessons?

 

The future of retail appears to be in "clicks-and-mortar" (or "bricks-and-clicks").  

 

Health care can act like B Dalton or Borders, assuming until it is too late that their consumers will visit them in person, because they always had.  Or it can act now to jump to the data-driven "clicks-and-mortar" approach that other retail businesses are moving to.  

 

Health care organizations which get that right will be the one to survive.  


This post is an abridged version of the posting in Kim Bellard’s blogsite. Click here to read the full posting

 

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