As consumers we all enjoy getting a good deal, especially when it comes to commodity items such as cars, white goods and furniture. In fact these sectors factor in a "perceived discounting margin" so you feel like you have won and will tell all your friends about the great deal you skilfully acquired (sorry - the dark side of marketing is playing you there).
For many years healthcare has been somewhat immune to "bargain hunting" and "shopping" from consumers. Sure there has and always will be genuine cases of financial hardship, but we haven't seen too much haggling … until now.
Patients are asking for discounts and will do so more and more in the future.
So why is it so?
Many factors are contributing to the increased 'haggling in healthcare' situation:
1. Consumers have more knowledge - Dr Google, online review sites, social media and "ask a friend" are in the pockets of consumers. They can search for local competitors and this enables them to "shop around"
2. Healthcare has been commoditised - television ads and comparison websites tell us to shop for less, compare the market and get the best deal on everything. People have become conditioned to seek bargains at every transaction and they aren't afraid to ask for them. Healthcare is just another purchase to be made
3. Generational differences - older Australians were taught to be seen and not heard, to not question authority and never ask questions. Boomers distrust organisations and government, generation X are fact finders and millennials are online natives who demand instant gratification. So now the bulk of your audiences aren't afraid to speak up and ask for what they think is rightfully theirs
4. The gap is widening - Medicare rebates have reduced. Private health insurance premiums have increased and rebates have reduced and health funds actively tell their members to "seek a discount" from their private billing medical professional
5. Perception of wealth - this is a touchy one, but my sense is that consumers (some, not all) think healthcare professionals have plenty of money. They are potentially ill-informed about the time, energy and financial commitment that has gone into education and further training and hear "big income" stories. With the Kardashian-factor (do little, earn a lot), they may have also forgotten to factor in that clinicians save lives and deserve the income they receive
The changing landscape of healthcare
Below is an article I discovered online (source: https://www.tipsonlifeandlove.com/general-health-health/can-you-ask-your-doctor-for-a-discount) that encourages patients to ask their doctor for a discount ...
Here is another recent story from The Sydney Morning Herald (https://www.smh.com.au/healthcare/specialist-fees-published-online-in-exorbitant-out-of-pocket-crackdown-20190301-p51179.html) that talks about publishing specialist fees online. And while the government thinks this will improve transparency, the AMA rightly states that publishing specialist's fees is not a fair solution and doesn't help explain to patients what is involved in the fee.
So with specialist and private practitioner fees a hot topic, more and more people will continue to ask for discounts.
How will you address patient requests for discounts?
First, it is important to separate the genuine hardship cases from the "cheeky shoppers". You can do this by:
- Showing empathy and asking the patient to tell you more about their situation and what leads them to believe they can't or won't pay some or all of the bill
- Speaking with the patient's GP to find out more about the patient's situation and billing history
- Verifying the information the person is telling you ie. their full medical situation, employment status etc
Once you have all the facts, the decision is yours. Some clinicians have a "financial hardships bucket" and bulk-bill patients who are facing terrible circumstances beyond their control. Others will offer payment plans or discounts on their fees.
However these negotiations should only be entered into once you are convinced you are dealing with a genuine hardship case. For all other situations, private billing patients need to pay for the high quality service they have received.
Gentle push back
Once you know the patient's real circumstance, you are fully entitled to push back politely and professionally and reinstate the clinician / patient boundaries and "fair trading" relationship. You have or will deliver a service that is high value, thorough, considered and life-changing and you deserve to be paid what you are worth. Here are some tips:
- Send estimates to clients before you perform any procedure. Check / explore any resistance to fee estimates early via phone
- Or send your fee schedule to new patients via email at the time of booking
- Seek upfront payments for surgical procedures
- Seek holding deposits prior to surgical procedures
- Make billing (post operative if this is your situation) as swift as possible
Include information that explains the quality and depth of services being delivered.
Knowing what to say
Here are two different approaches (firm and moderate) for you to consider based on the situation, your style and brand image:
A firm approach to discounting would involve some or all of the following:
- Non-negotiable signage in reception
- No discounting policy communicated on email footers, verbally and on all communication with referral parties and patients
- Flat refusal when asked for discount approach
- Escalate non-payment to third party debt collection
This approach works best when the expectations and fee estimates have been clearly communicated upfront. If the patient hasn't been advised of fees in advance and simply receives an invoice following their procedure, they can react adversely - also known as "sticker shock". In this instance a firm approach will likely antagonise the patient, so follow this path with caution.
A more moderate approach to managing fee resistance would involve some or all of the following:
- Listening to the patient's situation in a very thorough manner. Ask them lots of leading questions and ask them why they are telling you they are unable to pay for the service and if they have thought of any alternatives as to how they could pay
- Explain to the patient the value and depth of the service they have received
- Give the patient two options to help them achieve the payment over time
- Offer the patient a credit plan
- Make sure the patient knows that they need to pay for the service, but you will work with them to achieve the outcome
Note to self ...
One of the issues when it comes to purchasing health services, is the consumer doesn't know what they are buying. Avoidance, confusion or pain can often lead a patient to 'handing themselves over' without knowing the full complexities involved.
When you take the time to communicate your pricing structure upfront, you can also use this opportunity to explain what is involved in the fee and to heighten the sense of value in the patient's mind (hint - fact sheets work really well for this).
In this environment of consumer control, take the opportunity to use the discount enquiry to educate the patient about the value you deliver, the importance of your service and the difference that you make.
Don't react. Just respond.
Bit of light relief
Watch this short, funny YouTube video on how the customer is not always right. It might help restore a bit of sanity on the topic:
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For more information or assistance with your private practice marketing, please contact Megan Walker on 0417 602 390 or email megan[@]marketsavvy.com.au.