Customers know best – or do they?

As the baby boom generation nears retirement age, Americans’ concern over the rising cost of healthcare continues to grow. A recent national survey of U.S. adults reveals that not being able to afford healthcare in retirement is one of their greatest fears.

By 2050, the U.S. alone is expected to have over 80 million people who are over the age of 65, placing significantly larger burdens on the healthcare system, insurance premiums and ultimately, personal disposable income As a result, the issue of affordable and accessible healthcare is now at the forefront of physicians’, patients’ and insurance companies’ minds.

As the healthcare industry evolves, NGP asked Linda Shea, Senior Vice President at Opinion Research, a leading provider of market research to the pharmaceutical industry, to identify trends and illuminate the complex relationship between pharmacists, health care insurers, physicians and ultimately, patients.

NGP: How do you think the dynamics of the healthcare industry have changed as insurers play a larger part in patients’ selection of prescription drugs?

LS: As drug costs increase, insurance providers are taking more and more steps to intervene, particularly in terms of prescription drug purchases. Although only 7 percent of respondents in a recent Opinion Research study reported that their insurance companies indicated a specific drug brand to be used, findings suggest that health insurers will play a much larger role in the prescription decision in the future.

While this trend is inevitable, customers are understandably reluctant to allow health insurers to determine which prescription drugs they will use. Our research has shown that while 27 percent of Americans have been asked to substitute a brand named drug for a generic drug, 72 percent were adamant that health insurers should not be able to influence the brand of drug prescribed.

Should Pharmaceutical Companies Be Allowed to Promote Drugs Directly to Consumers

Interestingly, a consumer’s age plays an important role in his or her opinion of the insurance companies’ involvement in drug purchase decisions. The tech generation (18-25), who rely heavily on the Internet and television for information, are less concerned about the intervention of insurers in the decision making process. This is likely due to their ability to research prescription drug options themselves.

NGP: As you mentioned, customers are also now playing a greater role in drug selection. What effects will this trend have on the industry?

LS: I believe that the wealth of information easily available and frequently promoted to consumers is making customers more comfortable when it comes to selecting their own prescription drugs.

Through our work in the pharmaceutical industry, I believe that this transformation is largely attributed to the changes in advertising regulations and the mass exposure that these demographics have to drug commercials.

Resources for Health-Related Ailments and Their Treatments

Nearly half of the respondents in our study rely on the Internet and television to learn about health-related ailments and potential treatments. Although physicians still remain consumers’ top resource (79 percent), pharmacists play a much smaller role in a patient’s drug research – a function that was previously an integral part of a pharmacist’s daily life.

Obviously, we then have to consider the customer service mantra - the customer is always right. How can a patient gather the same level of knowledge from the Internet or the television as a physician who has been educated and trained in the medical field? How can physicians and pharmacists compete with the commercials and the Internet? How can they restore themselves as reliable and primary sources of information, particularly for the younger ‘tech savvy’ generation?

NGP: You mentioned that patients are looking less to their pharmacists and more to the television and Internet for information. Does this mean the pharmaceutical companies are getting it right?

LS: Yes and no. Only 55 percent of the people involved in our study think that pharmaceutical companies should be able to promote their drugs to consumers directly. Even so, it is clear that consumers are listening to the commercials given their reliance on the television for information and their willingness to make their own brand choices.

Of those respondents who feel pharmaceutical companies should not be able to advertise directly, 37 percent think that these decisions should be left in the hands of a physician and that the public really doesn’t have sufficient knowledge to make decisions of this magnitude.

Pharmaceutical companies should also be taking a closer look at their audiences. While millions of dollars are spent on television advertising each year, our research suggests that higher income, college educated people are increasingly becoming more savvy when it comes to making brand name drug choices. Is television the best medium to reach these people? Should more focus be put on print and Internet outreach?

No matter whether you agree or disagree with pharmaceutical advertising, television has clearly been an effective tool in reaching certain audiences.

However, I believe that there is significant opportunity for pharmaceutical companies to be more creative with their advertising to reach broader audiences.

Health Insurers Role in Decision of Brand Name of Drug Prescribed

NGP: What advancements do you foresee in our industry, which will help doctors, pharmacists and customers coexist in the information age?

LS: I feel that the role of the pharmacist will evolve tremendously over the coming years. As demands on pharmacists increase and patients have come to rely on their own information gathering skills, the pharmacist’s role has become less consultative.

I think we will see a greater reliance on technology as advances continue to be made. Due to the rapid growth in the number of prescription transactions and a shortage of pharmacists, the role had to become more operational. As technology evolves, I believe pharmacists will see their role becoming more influential and returning to a more advisory position. As a result, they may end up being the greatest influencers in the drug selection process.

Technology will be leveraged to drive self-service channels and greater efficiency around reimbursements; however, we can also expect questions to be asked around the safety and management of technology use in a pharmaceutical environment.

Linda Shea, Senior Vice President and Global Managing Director, Customer Strategies, Opinion Research Corporation

Ms. Shea provides leadership and direction to the organization’s global focus on customer strategy and management. She has spent the last 24 years helping organizations maximize customer relationships in ways that impact the overall performance of their business. Additionally her experience extends into the spaces of market development and brand/reputation management.

Ms. Shea’s work encompasses the full spectrum of the healthcare space, from development and manufacturing to marketing, distribution and the delivery of care.

She speaks at national conferences on a routine basis, has authored numerous articles and is quoted on a regular basis.