As healthcare organizations look to the future, they cannot overlook the need to place the consumer at the center of all they do. Only by improving care outcomes and consumer experience will they deliver financial returns and remain competitive while meeting consumers’ holistic health and wellness needs.
Consumers are more motivated than ever to choose healthcare options that offer a better experience, higher quality of care, and greater value. As the shift to consumerism continues, organizations that embrace it most successfully will emerge as leaders of the healthcare ecosystem. In the near term—beyond benefits to consumer experience and care—developing a distinctive consumer experience could translate to financial gains through increased acquisition, retention, and share of engagement; reduced administrative costs; and improved Consumer Assessment of Healthcare Providers and Systems (CAHPS) and Medicare Advantage Star ratings.
In this article, we explore the latest trends in consumer healthcare behavior, consider responses, and identify steps leaders can take to define a consumer-led strategy. We include excerpts from interviews with three senior advisers to McKinsey who have extensive experience executing consumer-centric strategies in retail and other industries.
Three trends can inform healthcare consumer strategy
Healthcare leaders do not have to fly blind as they devise strategies to improve the consumer experience along the care continuum. Three trends help point the way.
Trend 1: Consumers are spending more on health and wellness but are not satisfied and want more innovation
The US health and wellness market (inclusive of out-of-pocket healthcare spending) has grown to nearly $1 trillion, largely as a result of rising spending on out-of-pocket healthcare costs and personal wellness. There was an approximately 50 percent increase in wellness deal activity from 2020 to 2021, and US wellness spending in 2023 was more than $480 billion, with 5 percent growth in spending on wellness products and services. (Notably, this spending is in addition to billions of dollars in healthcare spending by payers, directed by consumers’ care choices.) Moreover, 58 percent of surveyed US consumers indicated they prioritize their personal health and wellness more now than a year ago. Yet despite high levels of engagement in health and wellness activities, a sizable percentage of consumers are not satisfied with their overall healthcare experiences (Exhibit 1).
The disconnect between high consumer importance and spending and relatively low satisfaction presents a meaningful opportunity for healthcare organizations to distinguish themselves as leaders in meeting consumers’ holistic health and wellness needs. For example, 67 percent of consumer respondents found health and wellness media within the healthcare journey (information on behavioral health centers within a confirmation email from a primary care physician, for example) to be helpful and interesting.
Healthcare organizations can expand their use of digital interactions and tools to better support consumers in their health journeys. Although other consumer-facing industries, such as entertainment, banking, and utilities, have prioritized substantial investments in digital engagement with consumers in recent years, healthcare continues to lag behind, with the second-lowest digital consumer adoption rate (Exhibit 2).
In the years to come, it will be critical for the healthcare industry to prioritize digital consumer engagement—both to keep pace with other industries and to meet evolving consumer expectations. According to data from the 2019, 2022, and 2023 McKinsey Consumer Health Insights Surveys, healthcare consumers of all ages have become accustomed to using digital products and services and are eager to see them incorporated into their healthcare. Moreover, use of digital tools has a positive effect on consumer experience: 60 percent of surveyed consumers reported being more satisfied with their most recent telehealth appointment than with an in-person appointment.
Beyond digital options for engagement, consumers are also open to innovative care models that would allow them to receive personalized and holistic care, such as team-based care and care management at home. Although traditional in-person care is still the norm today, healthcare organizations can differentiate themselves by introducing innovative care, engagement, and support models.
To effectively respond to this trend, organizations can commit to consumer centricity by bringing the right product or service to the right consumer in the right way (see sidebar “‘Being there’ for the consumer”).
Learning from organizations in other industries, healthcare organizations could consider taking novel approaches, such as the following:
- expanding their presence in the community to encompass the entire healthcare journey—
for example, by developing partnerships with wellness retreats, establishing connections to improve health in the home (via wearables, remote monitoring technology, and the like), or offering supplemental support to families when patients’ primary family caregivers are unavailable - bridging gaps that prevent consumer engagement—for example, by supporting alternative care models for around-the-clock coverage, such as a virtual nurse or at-home care
Trend 2: Consumers trust the healthcare industry with their data, but organizations underuse it
The healthcare industry continues to earn the trust of consumers, with 44 percent of surveyed consumers indicating they are willing to voluntarily share personal and health data with healthcare organizations—more than double the rate for technology or retail organizations (Exhibit 3).
However, unlike technology organizations, which have focused for more than a decade on using personal data to optimize service and support, healthcare organizations have largely not expanded their use of personal and health data to deliver a differentiated experience across the healthcare journey. More than half of surveyed consumers expressed interest in using their personal data to manage chronic conditions, receive personalized health and well-being insights, or receive personalized product and insurance recommendations. Healthcare organizations could employ the latest technology (for example, remote monitoring, AI, or integrated electronic health records) to use consumer data in a safe, controlled way that follows privacy, security, and local and industry regulations on data handling. This could both improve the consumer experience and streamline operations.
To effectively respond to this trend, healthcare organizations can embed personalization into the end-to-end consumer experience by using their consumer data assets and developing AI capabilities, including generative AI (gen AI) (see sidebar “Digital transformation supports consumer personalization”).
Healthcare organizations could consider applying this approach to improve patient access through innovative strategies including the following:
- customizing engagement interfaces such as landing pages, email campaigns, education initiatives, and scheduling appointments based on consumer attitudes, behaviors, preferences, and healthcare needs
- recommending an appointment in a care setting that works best for the patient in the time frame needed and with the appropriate clinician
Personalizing both outreach and follow-up can present additional opportunities. Using AI, organizations could proactively identify healthcare or coverage needs; using gen AI, they could draft messages for clinicians to sign off on—such as tailored reminders for care needs—and deliver them based on consumers’ preferences (text or email).
Finally, to get the full value from this technology and data, it is critical that organizations adopt an end-to-end transformation mindset. This includes implementing transformation best practices (such as setting a clear road map enforced by an operating model that holds leaders accountable for change), hiring dedicated talent, and launching change management to promote adoption and scaling.
Trend 3: Consumers are actively shopping and making trade-offs
In the face of economic uncertainty, consumers have continued their “shopping” behavior—that is, researching before making purchases—and are frequently trading down to the more affordable option.
This trend is affecting many industries, including healthcare: 45 percent of surveyed consumers report researching providers and in-network
costs before choosing a health insurance plan. Based on data from the 2022 and 2023 McKinsey Consumer Health Insights Surveys, 44 percent of healthcare consumers research providers before making an appointment. On average, consumers who research providers then look at two to three providers before making a decision. This represents a meaningful increase in shopping behavior compared to the 2017 survey, when only 20 to 30 percent of healthcare consumers conducted similar research.
According to data from the 2023 McKinsey Consumer Health Insights Survey and McKinsey analysis of internal data from Zocdoc, consumers typically take five factors into account when shopping for healthcare:
Quality. Consumers prioritize high-quality healthcare organizations and clinicians based on input from other consumers. Consumers are twice as likely to book an appointment with a clinician who has more than 50 reviews than with one who has none; nearly half of consumers prioritize quality ratings when choosing a clinician.
Availability. Consumers are highly sensitive to wait times for appointments, with long wait times frequently causing consumers to seek care elsewhere. Online scheduling platforms report that 45 percent of appointments are booked 24 to 72 hours in advance. Independent medical groups are currently best positioned to meet this preference, with 28 percent having availability within three days, compared to 17 percent at health systems. Nearly two-thirds of surveyed consumers reported that they sought care elsewhere when they encountered a wait time they perceived to be long.
Proximity. Consumers look for care that is close to home. A convenient location is a priority for about half of consumers, even when scheduling telehealth appointments: two-thirds of telehealth appointments are booked within driving distance of home (potentially in anticipation of future in-person appointments).
Cost. Consumers actively work to minimize out-of-pocket costs but frequently face challenges in doing so. Forty percent of surveyed consumers prioritize out-of-pocket costs when searching for care, and nearly 17 percent say that the cost of services can be a considerable barrier to receiving care.
Options for care. Healthcare consumers prioritize options to engage across multiple channels, such as in-person and telehealth. Care groups that offer both options receive 35 percent more bookings than those that offer only in-person appointments and 90 percent more bookings than those that offer only telehealth visits. Consumers also take advantage of multimodal care: for example, nearly half of obstetrics and gynecology telehealth visits are followed up with an in-person appointment.
Although consumers are generally inclined to stay with their current primary care provider, up to 70 percent are open to changing if the alternative offers meaningful differentiation. As healthcare organizations seek to be more competitive against market players, focusing on the factors that shape consumers’ decision making will be critical.
Healthcare organizations could respond to this trend by facilitating decision making for consumers, including with fast, convenient navigation of their systems that belies the vast complexity underneath and by enabling consumers to easily connect to the offerings they need when they need them (see sidebar “Easing the shopping and buying journey”).
Healthcare organizations could innovatively respond to this trend by taking the following actions:
- triaging consumers’ symptoms and preferences using a gen AI chatbot to help them schedule
a care appointment in the required time frame—and in doing so, expressing an empathic tone and offering educational information to manage expectations - providing consumers with a single source of truth about projected costs before they receive care; this can simplify the decision-making process, ensure transparency, reduce downstream frustration, and increase the likelihood that patients will receive the care they need
- revisiting scheduling policies to expand consumers’ care options and increase flexibility (for example, adding telemedicine as an option to additional types of appointments)
Finally, by seamlessly linking consumers to strategic partners across the holistic health ecosystem—ranging from medical devices to fitness and wellness classes to over-the-counter products—organizations could better support the needs of consumers.
Next steps to build a consumer-centric organization
Understanding how to best meet consumers’ current and future needs is necessary but not sufficient to become a true consumer-experience leader. Setting up a transformation for success over the long term requires three additional steps:
- Set a strategic vision. Craft a clear consumer-experience vision that will inspire and propel the organization to change its culture and ways of thinking about consumers. Ideally, this aspiration will capture the holistic value at stake in improving consumer experience (for example, growth or improvement in quality outcomes).
- Adopt an agile, human-centered operating model. Identify innovations grounded in the end-to-end consumer journey. Test and refine potential innovations using the agile “test and learn” operating model.
- Build consumer-centric capabilities. Invest in defined metrics, personalized communications, and other capabilities that put the consumer at the center (Exhibit 4).
Consumerism is no longer an emerging trend or secondary consideration in healthcare. Consumers expect their healthcare engagement and experiences to be as convenient and satisfying as many of the other activities in their daily lives. Healthcare leaders who energetically and holistically embrace this shift—reflected in their vision, operating model, and capabilities—could meet consumers where they are across the end-to-end healthcare journey and could increase care access, engagement, satisfaction, and patient outcomes along the way.
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