Healthcare’s race to catch up with millennials
January 10, 2020
By Paul Crnkovich and Dan Clarin
Healthcare is woefully behind other industries when it comes to meeting the needs of millennials. In an era of instant messaging, same-day delivery, and constant mobile access, today’s tech-savvy younger adults have high expectations for consumer quality, convenience, and cost.
Healthcare providers must act now to close an ever-growing gap between those expectations and existing care delivery models. Yet many healthcare organizations are slow to change, restrained by complex organizational structures and rooted in traditional delivery models.
Even so, the industry is changing, with or without them. Traditional and non-traditional providers across the country are in a race to completely reimagine, reshape, and remake healthcare. They are seeking to compete with services such as same-day appointments, virtual visits, and direct messaging with physicians or other clinicians.
To succeed in a shifting business model, healthcare leaders first must work to better understand the healthcare needs and demands of young adult consumers, particularly as it relates to routine care services. This article features highlights of a recent report, including consumer research on Millennials’ healthcare behaviors, and steps healthcare organizations can take to meet new consumer demands. The report, titled How Millennials Are Reshaping Healthcare’s Future, was published by management consulting and software firm Kaufman Hall.
The millennial generation is defined as those born from the early 1980s to the mid-1990s. Millennials range in age from the early 20s to the late-30s, and recently surpassed baby boomers as the largest population segment at 73 million. Millennials’ healthcare spending is significant and growing as they make care decisions for themselves, their young children, and increasingly, their aging parents. They make up about 34 percent of the population, and contribute 21 percent of total healthcare spending.
As with all generations, millennials have been shaped by the events and experiences of their formative years. When the Great Recession hit in 2007-2008, most Millennials were teenagers or in their early 20s. They have grown up more cost-conscious as a result, and are inclined to shop for the best and most convenient care at the lowest cost. Overall, millennials are less brand loyal than older adults. Healthcare providers seeking their attention must work to both win and retain their business.
The influence of big tech
Millennials and other young adults have grown up in a digital age with large, dominant tech companies such as Amazon, Apple, and Google. Nationwide consumer surveys of more than 6,000 individuals found that younger adults are highly familiar with these companies, and are more inclined than older generations to trust big tech to steer their healthcare journeys.
Three-quarters of adults ages 18-44 said they would use a mobile app developed by Amazon, Apple, or Google to help them find and select healthcare services, compared to less than half of those ages 45 and older. Forty-two percent of those ages 18-44 said they would trust those companies to develop the best online healthcare search tool, compared to just 20 percent of those ages 45 and older.
Rising expectations
Millennials and other young adults want convenient access to healthcare, when and where they need it. They increasingly begin their healthcare journeys online, and are demanding better online services. Among adults ages 18-44, 43 percent said they found where they wanted to receive care by searching online, and nearly half said they prefer to schedule medical appointments online.
When asked their top recommendations for improvements in healthcare, millennials identified the following areas:
• Finding accurate healthcare cost estimates
• Conducting video visits with a physician or nurse
• Finding which providers accept their insurance
• Having the ability to call outside of normal business hours
Young adults do not want to wait for care. Asked how long they are willing to wait to see a primary care physician for a minor injury or illness before seeking another option, most millennials said they will wait no more than a day. About a quarter said they would not wait more than four hours.
Millennials are more open than previous generations to using alternative care models such as telehealth, virtual, and walk-in clinics, yet many are frustrated by a lack of these types of convenient care options. Nearly 50 percent of those surveyed said they do not have easy access to a video visit for basic healthcare needs.
A call to action
To meet the demands of millennials and other young adults, healthcare providers should start by asking a vital question: Why will consumers choose you, and why will they come back to you?
This requires healthcare leaders to make a fundamental shift in mindset. Healthcare organizations need to transition from an internal, provider-centric business model, to an external focus on capturing consumer “demand” to drive new patient growth and increase patient loyalty.
As a first step, healthcare leaders should assess their organizations’ current capabilities and resources, and compare those to what is needed to transform their services, culture, and care delivery models. Serving Millennials and other young adults requires intense focus on four core elements:
Access– It’s all about the digital front door and providing the 24/7 on-demand access millennials are accustomed to in other areas of their lives. The key focus should be on redefining an organization’s primary/routine care business model
Experience– Providers need to offer a contemporary experience, including high levels of service and real-time consumer feedback opportunities
Pricing– Organizations must recognize that Millennials are highly price-sensitive and expect to find reliable and accurate pricing information online easily
Infrastructure– Organizations should build a solid foundation of insights and analytics to fuel decisions about access, experience, and pricing
Millennials no longer are “the future”. They are here and driving real healthcare change today.
Ultimately, the battle for healthcare’s future will center on routine, outpatient care for millennials and other young adults. To stay relevant, healthcare organizations need to understand and refocus on these younger generations. They must break away from traditional delivery models that emphasize the needs of consumers past, and push forward in the race to meet the demands of consumers now and into the future.
About the authors: Paul Crnkovich is a managing director and head of the consumerism practice at Kaufman Hall, and Dan Clarin is a senior vice president with the firm’s strategic and financial planning practice.
Access the full report, How Millennials Are Reshaping Healthcare’s Future
Healthcare is woefully behind other industries when it comes to meeting the needs of millennials. In an era of instant messaging, same-day delivery, and constant mobile access, today’s tech-savvy younger adults have high expectations for consumer quality, convenience, and cost.
Healthcare providers must act now to close an ever-growing gap between those expectations and existing care delivery models. Yet many healthcare organizations are slow to change, restrained by complex organizational structures and rooted in traditional delivery models.
Even so, the industry is changing, with or without them. Traditional and non-traditional providers across the country are in a race to completely reimagine, reshape, and remake healthcare. They are seeking to compete with services such as same-day appointments, virtual visits, and direct messaging with physicians or other clinicians.
To succeed in a shifting business model, healthcare leaders first must work to better understand the healthcare needs and demands of young adult consumers, particularly as it relates to routine care services. This article features highlights of a recent report, including consumer research on Millennials’ healthcare behaviors, and steps healthcare organizations can take to meet new consumer demands. The report, titled How Millennials Are Reshaping Healthcare’s Future, was published by management consulting and software firm Kaufman Hall.
The millennial generation is defined as those born from the early 1980s to the mid-1990s. Millennials range in age from the early 20s to the late-30s, and recently surpassed baby boomers as the largest population segment at 73 million. Millennials’ healthcare spending is significant and growing as they make care decisions for themselves, their young children, and increasingly, their aging parents. They make up about 34 percent of the population, and contribute 21 percent of total healthcare spending.
As with all generations, millennials have been shaped by the events and experiences of their formative years. When the Great Recession hit in 2007-2008, most Millennials were teenagers or in their early 20s. They have grown up more cost-conscious as a result, and are inclined to shop for the best and most convenient care at the lowest cost. Overall, millennials are less brand loyal than older adults. Healthcare providers seeking their attention must work to both win and retain their business.
The influence of big tech
Millennials and other young adults have grown up in a digital age with large, dominant tech companies such as Amazon, Apple, and Google. Nationwide consumer surveys of more than 6,000 individuals found that younger adults are highly familiar with these companies, and are more inclined than older generations to trust big tech to steer their healthcare journeys.
Three-quarters of adults ages 18-44 said they would use a mobile app developed by Amazon, Apple, or Google to help them find and select healthcare services, compared to less than half of those ages 45 and older. Forty-two percent of those ages 18-44 said they would trust those companies to develop the best online healthcare search tool, compared to just 20 percent of those ages 45 and older.
Rising expectations
Millennials and other young adults want convenient access to healthcare, when and where they need it. They increasingly begin their healthcare journeys online, and are demanding better online services. Among adults ages 18-44, 43 percent said they found where they wanted to receive care by searching online, and nearly half said they prefer to schedule medical appointments online.
When asked their top recommendations for improvements in healthcare, millennials identified the following areas:
• Finding accurate healthcare cost estimates
• Conducting video visits with a physician or nurse
• Finding which providers accept their insurance
• Having the ability to call outside of normal business hours
Young adults do not want to wait for care. Asked how long they are willing to wait to see a primary care physician for a minor injury or illness before seeking another option, most millennials said they will wait no more than a day. About a quarter said they would not wait more than four hours.
Millennials are more open than previous generations to using alternative care models such as telehealth, virtual, and walk-in clinics, yet many are frustrated by a lack of these types of convenient care options. Nearly 50 percent of those surveyed said they do not have easy access to a video visit for basic healthcare needs.
A call to action
To meet the demands of millennials and other young adults, healthcare providers should start by asking a vital question: Why will consumers choose you, and why will they come back to you?
This requires healthcare leaders to make a fundamental shift in mindset. Healthcare organizations need to transition from an internal, provider-centric business model, to an external focus on capturing consumer “demand” to drive new patient growth and increase patient loyalty.
As a first step, healthcare leaders should assess their organizations’ current capabilities and resources, and compare those to what is needed to transform their services, culture, and care delivery models. Serving Millennials and other young adults requires intense focus on four core elements:
Access– It’s all about the digital front door and providing the 24/7 on-demand access millennials are accustomed to in other areas of their lives. The key focus should be on redefining an organization’s primary/routine care business model
Experience– Providers need to offer a contemporary experience, including high levels of service and real-time consumer feedback opportunities
Pricing– Organizations must recognize that Millennials are highly price-sensitive and expect to find reliable and accurate pricing information online easily
Infrastructure– Organizations should build a solid foundation of insights and analytics to fuel decisions about access, experience, and pricing
Millennials no longer are “the future”. They are here and driving real healthcare change today.
Ultimately, the battle for healthcare’s future will center on routine, outpatient care for millennials and other young adults. To stay relevant, healthcare organizations need to understand and refocus on these younger generations. They must break away from traditional delivery models that emphasize the needs of consumers past, and push forward in the race to meet the demands of consumers now and into the future.
About the authors: Paul Crnkovich is a managing director and head of the consumerism practice at Kaufman Hall, and Dan Clarin is a senior vice president with the firm’s strategic and financial planning practice.
Access the full report, How Millennials Are Reshaping Healthcare’s Future