In the June issue of BoardRoom Press, Don Seymour shares components, characteristics, and new metrics for hospitals and health systems in 2024.

1. This article is the 2nd in a new series looking
at components, characteristics, and new met-
rics for hospitals and health systems in 2024.
In his 2005 best-selling book, The World Is
Flat, Thomas Friedman pointed out that
most industries are becoming increas-
ingly global in scope. It doesn’t matter
much where a company is founded or
headquartered; its jobs are moving to the
country that offers the best value—the best
combination of quality and cost. It doesn’t
matter much where you live; the products
you buy at your local store come from all
over the world.
Healthcare isn’t flat (at least not yet), but
it’s getting flatter in the U.S. and it is likely
to get flatter internationally. As uncertain
as we surely are, we must prepare for a new
consumerism journey, in which providers
are competing for business both within the
U.S. as well as globally.
Healthcare Consumerism 2.0
In 2006, it was reported that Bumrungrad
International Hospital offered world-class
healthcare in the heart of Thailand. U.S. News
& World Report featured the hospital on its
cover, highlighting its JCI accreditation,
internationally trained clinicians, and Amer-
ican management as well as its low cost. 60
Minutes also covered the story, reporting
that the cost, including travel expenses and
a vacation on the side, was less than the cost
of comparable care in the U.S.
When the aftershocks subsided, U.S.
healthcare providers breathed a collective
sigh of relief, and then quickly returned to
business as usual. Almost no one made seri-
ous preparations for global competition.
A lot has changed since 2006 but, for the
most part, everything remains the same.
Consumers have online access to Web sites
that offer comparative provider informa-
tion. Online information may be qualita-
tive or quantitative, outcomes-based, or
focused on process. Much of it is not yet
at the level it needs to be in order to be a
significant driver of choice. Consumers
continue to select providers based on prox-
imity, physician referral, and perception.
Consumer behavior will slowly but
inexorably change as the integrity of com-
parative information improves, insurance
companies exert influence, and patients
assume responsibility for a greater share of
the tab. Aside from Medicare and Medicaid,
80 percent of health insurance in the U.S. is
still employer-based, and high-deductible
plans are quickly penetrating the market,
just as they are dominating policy pur-
chases made on healthcare exchanges.
The 50-year-old suffering shoulder pain
from her tennis serve now has options: shell
out thousands of dollars to get her shoulder
scoped, or take Advil and apply ice while
hanging onto the cash. We can’t predict
what she’ll choose, but we do know she’ll
consider the options more carefully than she
would have if the deductible was, say, $500.
Is this same 50-year-old ready to fly
to Thailand for her shoulder procedure?
Today, it might seem unlikely. But a decade
from now, when she has useable informa-
tion on cost and quality, Thailand may
become a perfectly reasonable choice.
More importantly, as cost information
within the U.S. becomes better and easier
to understand, and as health insurance
marketplaces increasingly cross state lines,
consumers will have more choices for
domestic care destinations.
Preparing for Consumerism 3.0
The globalization of healthcare is still a
long way off, but the time to prepare is now.
These are some steps healthcare leaders
can take to prepare for a consumer-driven
marketplace in the next decade:
• Directors, executives, and physicians
must be diligent in focusing their
organizations on quality, satisfaction, and
efficiency outcomes. Structures, pro-
cesses, and metrics to achieve these
outcomes are paramount, and the focus
of great governance.
• Board members must demand accurate,
comparative board-level scorecards
measuring quality, satisfaction, efficiency,
and other outcomes. The key is to start
small with a few indicators that everyone
understands, and increase complexity
and sophistication over time.1
The U.S. cannot compete with the rest of
the world on cost, but some patients will
feel more comfortable staying within the
U.S. for quality care, something the U.S. can
compete on. Thus, the consumer-driven
marketplace will have implications for
competition (on quality and cost) both
within and outside of the U.S. The role of
leaders is to assist patients in accessing the
highest-quality, lowest-cost care, wherever
it exists in the world.
U.S. consumers are clearly confused and
frustrated when they attempt to discover
which provider actually achieves the best
outcomes for the procedure they require.
The data is often wrong and, at best, dif-
ficult to analyze on a comparative basis.
Leaders should instruct their marketing
and public relations departments to com-
municate with their patients on a level they
can understand.
Now is the time to start preparing for a
marketplace that crosses national bound-
aries. Fortunately, the strategies that will
help U.S. providers compete globally will
also help them achieve better outcomes at
a lower cost to compete locally, regionally,
and nationally. Boards need to be relentless
in demanding improvements in perfor-
mance if their organizations are going to be
global players a decade from now.
The Governance Institute thanks Don
Seymour, executive vice president with
INTEGRATED Healthcare Strategies and
Governance Institute advisor, for contrib-
uting this article. He can be reached at
don@donseymourassociates.com.
Excellent examples of board-level scorecards
are available through e Governance Institute
(GovernanceInstitute.com).
Metrics for Success: Healthcare Consumerism
An Emerging Trend That Will Impact Providers over the Next Decade
By Don Seymour, INTEGRATED Healthcare Strategies
16 BoardRoom Press • june 2014 GovernanceInstitute.com
A D V I S O R S ’ C O R N E R