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Price Transparency Is a Customer Service Opportunity In Health Care

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John DiJulius, the customer service guru, once said that price is irrelevant. His point was that if you provide such a great product or service, the consumer will no longer care about the cost of said product or service. This is perfectly demonstrated when it comes to my distaste for coffee.

When Price Is Irrelevant

I find coffee very bitter and luckily, I don't need the caffeine to get started in the morning. That all changed when my wife brought me a cappuccino with almond milk from a coffee shop in San Francisco. It was amazing. And at $7.50 a cup, price became irrelevant. Even more amazing, price became irrelevant for a product I don't typically like.

The concept of price irrelevancy "works" when you're talking about coffee. Why? Because even if I don't the know the cost of a really expensive cup of coffee, I still have a pretty good idea that coffee probably costs $2 at a diner or $5 at Starbucks. So, I know that even the greatest cup of coffee in the world won't be $50 or $500. And to my point, even the greatest cup of coffee in the world, the cup I had in my honest opinion, was only $7.50.

When Price Isn't Irrelevant

The “irrelevancy concept” holds true when the consumer has a baseline for comparison. But what if you're talking about an industry where you have no baseline for comparison? That industry would be health care. This is why you never hear anyone say, "that hospital provides the best customer service so I'm getting my MRI there. I don't care if it costs $500 or $5000!" The reason you've never heard that phrase is because it’s never been said.

Price isn't irrelevant if you don't have a baseline for comparison (as in health care). But this provides us with an opportunity.

Consumers are looking for actionable pricing information but can’t find it anywhere (U.S. averages and crowdsourced data points are not actionable). So if you or your practice could give the consumer the one thing they’re desperately seeking (pricing info), you would quickly realize two things: 1) you’ll be one of the few offering that information and 2) that level of customer service would separate you from the competition.

Price transparency is a huge, untapped customer service opportunity. If most providers shroud their pricing in secrecy but you as a provider do offer pricing through your website, you would be delivering exceptional customer service.

When it comes to health care, great customer service doesn’t lead to price irrelevancy. In health care, the comparable inverse corollary would be true: price transparency leads to great customer service.

Everyone should be taking advantage of this opportunity, but few are. Providing great customer service through price transparency is noble. However, don’t just list prices as a static menu. Health care providers should only offer pricing if they can get the interested consumer’s contact info in the process. Why? Because in addition to pricing, the consumer will have additional questions and will need a “concierge” at the doctor’s office to help them through this process. With the consumer’s contact info — a lead — the provider can take their customer service approach to the next level.

Price TransCAREncy

When doctors or facilities have a price estimator on their website like the Ohio Surgery Center and Georgia SurgiCare do for insurance-based services or like this dentist, dermatologist and plastic surgeon do for bundled, cash-pay services, the consumer can check pricing automatically, but only after entering their contact info. This way, the provider generates a lead for follow up. By having the consumer's contact info, the provider can further assist the potential patient in navigating their way through the health care gauntlet.

And to be clear, these leads generated through a price estimator on the provider’s website are high quality leads. Consumers are so desperate to know their out-of-pocket costs, they’re willing to provide their name, email address, and phone number to capture that pricing information.  

Based on this peer-reviewed study, 17.8 percent of inquiries submitted through a price estimator that combines price transparency with lead generation ultimately came in for a consultation. Of those, 62.2 percent booked a procedure. Prospective patients that were price-aware at the time of consultation were 41 percent more likely to book a procedure than non price-aware patients. This ensures consultations are with only the most serious of patients.

Other Benefits of Price TransCAREncy

In the process of capturing contact information when the consumer checks pricing, the provider can passively generate a huge email database for future email marketing and remarketing. With their own email database, providers will be less dependent on Facebook, Google Adwords or other costly forms of digital advertising to generate leads.

With a website-embedded price estimator to capture leads, a practice will also reduce dependence on other doctors for referrals. More consumers are shopping and finding other physician websites on their own, without the help of a referring physician.

Going forward, practices need to cast off the old paradigm of getting patients from referrals only. They will have to adopt an omnichannel lead generation strategy. That is, generating patient leads from their website, social media, word of mouth, and physician referrals. A price estimator on their website will further that strategy.

To be clear, using Price TransCAREncy (price transparency + lead generation) as a customer service opportunity applies to all providers that offer outpatient services. Including services that may be paid out of pocket because a deductible hasn’t been met or because it’s considered cosmetic and insurance does not cover it.

Usually customer service improvements come in small incremental changes to the consumer experience. However, in this case, offering price transparency would be a disruptive, industry-shifting improvement to the customer service experience. And the provider that embraces this strategy, the so-called early adopter, will decimate the competition.

Dr. Jonathan Kaplan is a board-certified plastic surgeon based in San Francisco, CA and founder/CEO of BuildMyBod Health, an online marketplace for health care services that allows consumers to determine cost on out-of-pocket procedures, purchase non-surgical services, and in exchange, the health care providers receive consumer contact info - a lead, for follow up. 

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