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The customer is King. That is an immutable truth in business.

In healthcare, like every other business known to mankind, we have customers.

customer is kingIn business there are two groups of leaders, one that understands and respects that truth and then walks the talk. The other, the one I label as misguided group B, believes, consciously or subconsciously, that they know best and that the customer should agree and compliantly respond, or to sit down and be quiet.

In the end though, the customer is always right and hell hath no fury like a customer scorned, ignored or otherwise disrespected. That, too, is an immutable truth.

The reason this concept is so important is because of something called population health management. In the past, healthcare was a wholesale enterprise. We focused on independent physicians who controlled the patient flow into the hospital. They were our primary customers; the patients were, in effect, end users. As long as the physician was satisfied, presumably with the feedback from their patients, all was well and life was good for the hospital CEO. We had marketing programs but our model was still a wholesale-based approach. While that model has slowly changed over the years, population health management will, based on how I see this concept unfolding, dramatically change our business model from wholesale to retail. For some, this doesn’t seem to be a radical change from where we find ourselves today, on March 4, 2015. But nothing could be farther from the truth.

Health systems and hospitals now employ or rent physicians and that variation to the traditional relationship gives hospital executives a false sense of security. If we own, rent or control the physicians, then we have control of their patients, or so goes the reasoning in many hospital/health system circles.

In fact, this new business model will make the hospitals/health systems and their physicians, function like true business partners, rather than a variation of their traditional wholesale arrangement, because population health management will sooner, rather than later, disrupt traditional patient/physician/hospital loyalties and service migration patterns. Like banks, auto dealerships and other retail businesses, we will have to compete for customers – and compete aggressively.  To retain their loyalty and their business,  it will all boil down to price, quality outcomes, level of service and satisfaction.

In this new healthcare economy, that the customer is King takes on new meaning. Those who do not understand that dynamic will face an uncertain career future.