External Influences on Consumers Choices
Health Care Consumer – Trends and Marketing
7th October 2019
External Influences on Consumer Choices
Marketers need to understand consumer behavior to survive and be successful in a competitive marketing environment. Besides, understanding consumer demographics helps in determining the impact social networks, media, marketing, branding, and communication have when consumers choose the various health care plans. The three primary health care insurance plans are Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), and Point of Service (POS). Therefore, this assignment will focus on the advantages and disadvantages of the health care insurance plans and the impact of external influences have on consumer behavior.
Advantages and Disadvantages of the Various Health Care Insurance Plans
|Advantages||1. Most of the services are covered as a complete package having relatively few maximum restrictions on individual services. The covered services include outpatient services, the full cost of hospital care, X-ray and laboratory services, special-duty nursing, and many other services. Hospital appointments to HMO doctors are covered as well, either at a nominal charge or in full for every visit. Some new HMOs permit insured persons to choose any physician at a higher fee.2. Members are required to pay a fixed monthly prepaid payment for the health services provided. Thus, this enables HMO providers to offer the best care to beneficiaries and ensure their health problems are solved effectively. Besides, it allows patients to obtain preventive and quality care through HMO policies. Coinsurance requirements and high deductibles are often not emphasized, and instead, the emphasis is on controlling costs.||1. Several people select Preferred Provider Organization since it allows its members to choose any facility or physician within their network. Also, employers prefer PPOs over HMOs because they offer some cost savings in relation to indemnity policies, with fewer restrictions on health care access, such as the need for a doctor referral before seeing a specialist.2. PPOs offer out-of-network benefits where they pay huge medical costs for health care services provided by doctors outside their network. Thus, allowing its members to get medical treatment from different healthcare practitioners irrespective of managed care association.||1. It is flexible as it enables members to visit out-of-network doctors; thus, beneficial to family members who frequently use outpatient services such as, counseling or therapy. Medical costs are lower if you visit physicians within the network.2. Another main advantage of selecting POS health insurance is zero deductibles and low co-pays. For instance, an individual’s co-payments usually range between $10 t0 $20 for routine office appointments with in-network facilities or doctors. Additionally, premium expenses for POS insurance plans are approximately one-half of the costs related to PPO plans. When deductibles are not incurred, out-of-pocket costs reduce; therefore, the breakdown of payments under a POS insurance policy is similar to other kinds of managed plans but less expensive compared to PPO.|
|Disadvantages||1. The premium paid by members is limited to only covering expenses for physicians within the network. Besides, when a beneficiary needs specialized treatment, he or she needs a referral first from the primary care physician. As a result, delaying patients the opportunity to receive health care services in a good time.2. Another disadvantage is that HMO’s are now imposing a coinsurance requirement for specific illnesses, such as drug addiction or alcoholism. Coinsurance policies are usually costly because of the deductibles, which must be fulfilled before the insurance firms cover the medical costs.||1. PPOs are quite expensive compared to HMOs because their co-payments are usually higher. People prefer PPOSs due to their flexibility; however, the full rate for hospitals and doctors outside the network is quite expensive. 2. Its members are required to pay deductibles before they start enjoying their coverage benefits. Thus, causing people to avoid seeking health services and treatment due to the deductible cost needed before the full benefits are in use.||1. POS insurance plan comes with a lot of paperwork for patients seeking medical treatment outside their network. Individuals are also required to pay upfront charges in full and file their medical insurance claims. In some cases, compensations may take several months to sort out. 2. Deductibles for out-of-network care can be costly. Individuals who need to seek specialized treatment outside the network are required first to fulfill the obligation of paying a high annual deductible fee.|
The Impact of Media and Social Networking On Consumers When Choosing the Most Appropriate Managed Care Health Insurance Plans
- Impact of External Influences On Consumer Choices
The media and social networking platforms such as Facebook, YouTube, and Twitter have both positive and negative impacts on how individuals manage their health. For instance, it provides essential reviews to patients researching specific illnesses and insurance plans suitable for their medical conditions (Liu & Lopez, 2014). For example, people can engage in online conversations through Facebook and share information regarding the most suitable managed care health insurance plans. There is increased competition among the various health care insurance plans. Thus, employees are presented with a variety of choices to choose from depending on their preferences. The characteristics of consumers determine their choice, whereby, those with deteriorating health conditions are likely to select expensive insurance plans compared to those having better health care status. Besides, consumers would also prefer insurance plans that are flexible such as PPO and POS, allowing them to seek specialized treatment outside their network. Negative social media reviews regarding a specific health plan could negatively influence the decision of a consumer to purchase a particular product, visit a certain facility, or sign up for a particular health insurance plan.
The Influence of Branding, Marketing, And Communication On Consumer’s Choice When Considering an Appropriate Managed Care Health Insurance Plan
Branding is a marketing practice that involves creating a design, name, or symbol which identifies and distinguishes a product or service from the rest (Hillenbrand, Alcauter, Cervantes & Barrios, 2013). Marketing, on the other hand, involves selling and promoting a company’s products or services. Firms use various marketing strategies to market their brand name to attract and retain potential customers. Concerning health care insurance plans, marketing, branding, and communication are usually used to influence the choice of the customer. The influence may have a positive impact if it helps customers to analyze their financial positions, desires, and the prices of the different health insurance plans. Nonetheless, the influence can be detrimental if the promotional messages are not clear; thus, misleading and confusing the consumer. Consumers will purchase a product whose brand relates to their personality. Therefore, businesses should always aim to establish reputable brands and promote them in clear messages.
How Communication and Education to Consumers Differs by Generations When Marketing Managed Care Health Insurance Plans
Marketers often find it challenging to ensure that their marketing strategies cover all the consumers from different generations, that is, generation X, baby boomers, and generation Y. Communication techniques differ from one generation to another when marketing managed care health insurance plans. For instance, baby boomers comprise of individuals born between 1946 to 1964, who value money and time. Also, they tend to brand-faithful compared to the younger generations; hence they are loyal to health care providers who offer high-quality health services. Therefore, the most suitable communication method for this group would be a face-to-face meeting rather than text messages. Generation X individuals are born between 1965 to 1980, and they prefer convenience when accessing health care services because they are usually busy. Email marketing is the best approach to communicating since they keep checking their emails at home and work using their desktops and iPhones. Lastly, generation Y comprises people born between 1981 to 1999, and they are generally calm and relaxed. Personal relationships often influence their loyalty towards a brand. Thus, a negative experience from an individual can cause them to switch to a new health care plan. The most appropriate communication method is using social media platforms such as Facebook and Twitter to convey health plan reviews messages. Social networking platforms connect a large number of individuals from generation X.
Liu, Y., & Lopez, R. (2014). The impact of social media conversations on consumer brand choices. Marketing Letters, 27(1), 1-13.
Hillenbrand, P., Alcauter, S., Cervantes, J., & Barrios, F. (2013). Better branding: brand names can influence consumer choice. Journal of Product & Brand Management, 22(4), 300-308.