I think it’s safe to say that Amazon is a household name for most American consumers. There’s also a name for the disruptive impact the company has had on consumers and businesses alike — the Amazon Effect.

For brick and mortar retailers, the Effect has resulted in store closings, supplier price re-negotiations, and weak attempts to mimic the Amazon distribution model. It’s even having a ripple effect on grocery shopping, since retailers like Walmart have had to re-energize food and beverage sales to compensate for merchandise revenue lost to e-commerce.

So what does all this have to do with health care?

Amazon has been toying with the idea of breaking into the multi-billion pharmacy market for years. And according to a recent article, it’s getting more serious. Amazon is investing in new executive health talent, including Mark Lyons from Premera Blue Cross, and they’re already selling medical supplies and equipment, such as walkers and wheelchairs, heart and oxygen monitors and wound care supplies. Sure, prescription medications will present some new regulatory hurdles, but somehow I think Mr. Bezos will be undeterred.

If successful, Amazon’s latest plans will cause the greatest disruption to retail pharmacy giants like Walgreens and CVS (and Walmart…poor Walmart), but it may not be long before they impact providers more directly. Here are three reasons why hospitals and health systems should pay close attention to Amazon:

  1. The failed retailers are trying to tell you something. While their foray into prescription drug sales may have a limited impact on hospitals and health systems, Amazon’s next move may be more disruptive. For example, will Alexa one day offer basic medical advice, add you to the waiting list at the Urgent Care or facilitate access to a second opinion? Many traditional retailers remained skeptics and spectators for too long, believing that the world of e-commerce could never replace the “try-it-before-you-buy-it” model. Now, their margins are eroding and their stores are closing. Don’t be the Macy’s of health care. HDHPs are not going away. Accelerate your shift into the world of health, wellness and prevention in meaningful ways. And think more like a consumer. Map every patient touch point. How is what you are saying, doing or offering making it easier for your people to manage their health?
  2. The data and analytics are trying to tell you something. One of the reasons Amazon is so successful is that they use their customer data to personalize the user experience. Hospitals have a plethora of data that could be used to re-humanize the health care experience. While HIPPA may pose some limitations, don’t let that deter you from doing something. Use what you can to help your patients feel like you actually know them. While this may be easiest to do in physician offices or with patients needing series treatment, even episodic visits can be more personal. Or, you can start with the digital experience. If you have an online appointment system, does it remember that Mrs. Hemmings prefers Friday morning appointments, and default to the first available Friday appointment when she logs in? And what about your patient portal? If they’re like most, they’re nothing more than a watered-down excerpt of a medical record, one clearly not designed for the average patient. Perhaps this is a challenge for your EMR partner to rethink the patient portal. Reverse engineer the format, content and functionality. This time, from the patient’s perspective. If you want to engage people in their health, you have to give them a reason to engage.
  3. Consumers are trying to tell you something. For most consumers, their physician office visit, physical therapy sessions, prescription drugs, MRI, knee surgery and insurance statements are all one continuous health experience. They expect that these are all somehow connected behind the scenes to ensure safe care, the best outcomes and the correct bill. Most know in their head that this is not true, but every other fiber of their being wants to know why not. While the ACA sparked unprecedented consolidation and reconfiguration in health care, and the HITECH Act ushered in electronic medical records and interoperability, the health care experience that consumers want still does not exist. And it’s certainly not due to a lack of technology on ingenuity. We can transplant everything from brains to faces. More than 75 percent of Americans carry a computer in their pocket. And Amazon can reach nearly every household in the U.S. To borrow a pertinent phrase from another market leader who gets it, consumers are pleading with health systems to Think Different.

 

The Amazon Effect is coming to health care. Will your health system be the one leading the way?