Consumerization — the acknowledgment of the growing role of consumers and the need to develop strategies and market offerings that fulfill their needs and preferences and fully engage them in an end-to-end customer experience — is becoming an imperative in healthcare for payors, hospitals and health systems, and life sciences companies.

Once considered the domain of consumer product companies, consumerization has spread to service companies in banking, insurance, and now, healthcare, as advances in technology and easy access to quality and cost data have empowered consumers.

Market forces in healthcare, including years of double-digit increases in the cost of care, the inability of employers to pay the ever-growing bill for employee medical benefits, and of course, healthcare reform, are driving a transformation among healthcare consumers.

Far from being the traditionally-passive recipients of care that was prescribed and financed by others, consumers are being called upon to take a greater hand in managing and paying for their own health. In response, they are quickly becoming better informed, more discriminating on price and quality, and increasingly willing to walk away from poor service.

As in other industries before it, the rise of consumerism is likely to precipitate a sea change in how business is conducted in every sector of the healthcare industry. The industry, which has been focused on its institutional stakeholders — insurers, employers, and hospitals — will shift to a new basis, in which health plans, care delivery, and even administrative services are reoriented to focus on individuals and families.

Significant change will be required to thrive in a consumer-centric environment, and the winning players will be those insurers, hospitals, physician networks, pharmaceutical and other health care companies that can successfully apply a deep, nuanced understanding of consumers to the development of new business models, capabilities, and offerings.

We are already seeing some healthcare players embrace consumerization. Health plans are creating websites that connect their members with care providers and enable them to better monitor and manage their own health. Providers are shifting from opaque, volume based, fee-for-service models to alternatives including fixed price episodic bundles, which are transparent to patients.

Pharmaceutical companies are offering patients discounts on prescription refills to raise treatment adherence levels. As ideas such as these multiply and spread, consumerization will produce more personalized experiences at every customer touch point in healthcare, and by fully focusing on and engaging the consumer, the long-sought promise of improved outcomes and reduced costs will be realized.

PwC’s Strategy& strongly believes that consumerism is a revolutionary force that will fundamentally alter the status quo in the health industry. Revolutionary times are always difficult to navigate and fraught with risk, but they are also exciting and rich with opportunity.

We work with our clients as they seek to understand all the implications of this new world and become leaders in the consumerization of healthcare.

Service areas

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The rise of consumerism in the health insurance sector is already underway. Large groups are shifting coverage decisions and management to their members, and insurance exchanges are stimulating growth in the retail segment of the market. A new surge of individual insurance buyers will force ever greater attention on the needs of members as opposed to employers.
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The rise of consumerism is adding to the already considerable challenges facing care providers of every kind. In addition to grappling with increased demand, the rising cost of care, and the need to improve outcomes, hospitals and health systems, physician groups, and service providers alike are being called upon to become more patient-centric in every aspect of their performance.
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As out-of-pocket costs continue to rise, consumers are ever more sensitive to the value and price of health products, and are increasingly opting for generic and discount brands when they cannot discern a clear advantage to buying premium brands. Life sciences companies are pursuing consumerization in order to better focus on and respond to the needs of these new, financially-minded healthcare consumers.