U.S. Healthcare Discussion Misses Key Point: Customer Service -- Americans Demand Healthcare Service and Will Switch Providers to Find Better Care, According to New Study by Katzenbach Partners Poor Service Can Drive Patients Out of the System and Hurt Healthcare Organizations To Improve Service, Providers Must Do More Than Talk About Care - They Must Become "Empathy Engines"

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The current U.S. healthcare discussion misses a key variable: U.S. healthcare providers may succeed or fail based on the quality of their customer service.

The formal organization of systems and structures plays a key role

    Poor service drives Americans to switch providers, or drives them away from better-qualified providers, leading to inefficiency, higher costs and lower quality of care, according to a new report, including a survey of 1,003 Americans, by Katzenbach Partners entitled The Empathy Engine: Achieving Breakthroughs in Patient Service. Katzenbach Partners is a management consulting firm focused on helping large companies improve organizational performance.

The report says healthcare providers should respond by ramping up the quality of their customer service and becoming "empathy engines" - transforming their organizations to allow frontline employees to focus on patient problems and innovate to deliver solutions.

This imperative applies to the full spectrum of healthcare players, including hospitals, clinics, payers, vendors and pharmacy chains, according to the report.

"We talk about access to care and that's a critical question but it's only part of the story," says Jenny Machida, an Engagement Manager at Katzenbach Partners and co-author of the report. "It's important to bring people into the healthcare system but it's equally important to provide an experience that keeps them in the system, that really solves their problems, and at the same time makes the entire system more efficient and effective. In practice that means managing the healthcare organization so that it really listens and cares."

"The good news is that most healthcare workers are naturally empathetic," adds co-author Traci Entel, a Principal at Katzenbach Partners. "But the organization needs to be managed to let that empathy come through."

Americans Care About Healthcare Customer Service and Will Switch Providers to Find Better Service

Americans have extensive first-hand experience interacting with the healthcare system. The vast majority - 84 percent - have been in a hospital or clinic in the past three years, either as a patient (50 percent) or visitor (60 percent), according to Katzenbach Partners' recent survey of 1,003 Americans. But when their experience is not positive, they are willing to vote with their feet:

-- One in four Americans has switched or considered switching doctors (26 percent) or hospitals or clinics (23 percent) because of negative experiences, according to the research.

-- More than half (52 percent) say they choose hospitals and clinics based on whether they believe employees understand their needs. (Only one in five choose based on convenience.)

But Americans Feel Healthcare Customer Service is Poor: Some Think It's Worse than Airline Service

Americans in large numbers give healthcare customer service poor marks - and as a result are making decisions that lead them to seek care elsewhere:

-- One in four Americans say bad experiences have caused them to use (12%) or think about using (12%) walk-in centers to avoid hospitals, clinics and doctors' offices.

-- Healthcare customer service lags behind other industries - sometimes in surprising and disturbing ways. While it's not a surprise that most people (51 percent) think hotels are better at customer service, nearly half (40 percent) thought banks provided better customer service than hospitals and clinics. Shockingly, a significant number (18 percent) think that even airlines are better at customer service than healthcare providers.

-- These bad perceptions are based on real experiences - nearly a third of visitors (32 percent) and nearly a quarter of patients (23 percent) said healthcare employees did not do a good job of making them feel like their individual needs were understood.

But Great Customer Service Can Solve Major Problems with the Healthcare System

The impact of poor healthcare customer service goes beyond patient or visitor satisfaction: It affects the efficiency, quality and cost of care, and the retention and motivation of highly skilled and scarce healthcare workers, according to the report. Conversely, great customer service can lead to major improvements in the healthcare system:

-- Improved customer service has the potential to contain cost by limiting no-show appointments, the inefficiencies caused by switching providers (especially duplicated tests), and malpractice suits.

-- Better customer service increases the satisfaction not only of patients but also of employees. That, in turn, improves retention of key personnel - in particular nurses, who are in critically short supply.

-- By making patients more willing to stick with their provider, better customer service improves continuity of care, which in turn improves quality of care.

Reform is Possible: Healthcare Providers Can Leapfrog Other Industries and Become Empathy Engines - Models for Great Customer Service

Despite the poor marks they currently receive, healthcare providers have the potential to lead in customer service - not only matching but leapfrogging other industries, Ms. Entel says.

"Empathy is what draws many workers to the healthcare industry in the first place," Ms. Entel says. "They're a reservoir of empathy that healthcare providers can tap. They excel at improvising and finding small but important solutions. For example, Texas Children's Hospital empowers its employees to solve problems on their own. They acted on their own to bring in a mechanic to fix a door when a mother and child needed privacy. At the Mayo Clinic, the staff found a way to schedule appointments more than six months in advance - in spite of the limitations of the computer software - by creating their own improvised system. In each case, this wasn't something they were asked to do - it's something they did on their own."

As a result of that natural talent pool, "Healthcare providers don't need to radically revamp their organizations," Ms. Entel says. "But they do need to harness and unleash that empathy. Healthcare workers are 'naturals,' so healthcare organizations should not just perform on par with other industries like hospitality, but surpass them and become models for customer service."

Healthcare Providers Can Become Empathy Engines by Harnessing Employees' Natural Talent and Tapping the "Informal Organization"

According to the report, healthcare organizations can transform themselves into empathy engines by tapping into the "informal organization," the network of individuals that exists in every business or institution, outside the formal organization chart. The informal organization is where most work really gets done and where most problems are solved.

"The informal organization is central to healthcare - most care is provided one-on-one, or in small groups, far away from processes and systems," Ms. Machida says. "Healthcare providers can tap the empathy and energy that lives in the informal organization. The first step is to recognize that it exists. The next step is to capitalize on that energy - listen to employees and empower them to innovate and deliver quality care on the frontline."

She adds, "We found a group of employees at NYU Medical Center that organized their own program to create new patient service standards. They created meetings and a reward system, and exerted peer pressure - in a nice way - to get other employees involved. Senior leaders can tap into that energy and enthusiasm by putting aside formal branding programs and surveys - and instead meet with employees in informal settings and truly hear what they have to say. At Baptist Health Care, executives even participate in a 'Work in My Shoes' program where they swap jobs once a year with frontline workers."

The report also describes the successful experience of The Robert Wood Johnson Foundation. It launched a Transforming Care at the Bedside program at 12 hospitals that increased nurses' bedside time from 30-40 percent to 70 percent by giving them control of their own units.

Make Sure the Formal Keeps Up With the Informal

"The formal organization of systems and structures plays a key role," Ms. Entel says. "Once the institution understands what its best employees are doing on the frontline - their innovations and contributions - it's the task of the formal organization to put systems in place, such as recognition and training programs, that reinforce empathetic service and achieve large-scale impact."

"By managing empathy as a capability - measuring it and promoting it through hiring, role design and promotion - the formal organization can make sure that empathy takes root," Ms. Machida says. "For example, in developing recruiting strategies, the formal organization can play a key role by recognizing - and acting on the insight - that many people learn empathy in customer service settings outside of healthcare. A formal program to recruit from the retail or hospitality industry can help capture that empathy and ensure that empathy becomes part of the organizational DNA."

The report describes how The Mayo Clinic put a system in place that asked candidates for frontline positions to tell a story about when they were truly empathetic. That helped identify the best performers and also signaled that great care is more than just medical care - it's the capacity to deliver empathetic patient service.

"Empathy is not much talked about in the healthcare reform debate," says Ms. Entel. "But it's the hidden factor that, once you address it, can transform the healthcare system."

For a copy of the report, "The Empathy Engine: Achieving Breakthroughs in Patient Service," or to schedule an interview with Ms. Entel or Ms. Machida, contact Alexandra Corriveau of Sommerfield Communications at (212) 255-8386 or alexandra@sommerfield.com.

About Katzenbach Partners

Katzenbach Partners LLC works with leading global companies to achieve breakthroughs in organizational performance. The firm applies new thinking about how organizations work, serving companies across industries to shape strategy, improve operations and effect change. Katzenbach Partners is building a different kind of consulting firm, one that integrates strategic problem solving with pragmatic insight into people and organizations. http://www.katzenbach.com.

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Alexandra Corriveau
Sommerfield Communications
212-255-8386
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