Loyal customers are the cornerstone of success for healthcare organizations at every level, from insurance providers and Organizations to hospitals and individual practitioners.

Customer retention and satisfaction is a top priority concern for many Health Plans, since high disenrollment rates affect profitability.

Staggering turnover rates of 20 percent per year cost healthcare groups millions of dollars annually, notes Roberta Clarke, a leader in healthcare marketing and a professor of marketing at Boston University.

A 200,000-member plan with a $120 monthly premium and an 8 percent annual disenrollment loses $24 million in revenue each year, according to The Bayer Corporation Guide to Improving Member Retention. And industry experts agree that, in healthcare as in other industries, the cost of acquiring new customers is 6 to 10 times greater than the cost of retaining existing clients.

As if keeping customers around was not hard enough, healthcare organizations face the daunting challenge of having to please not only members, but multiple intermediaries as well.

Some studies also suggest that physician satisfaction can influence patient satisfaction, which has consequences for membership retention in Organizations.


According to a Creating Member Value article by Reidenbach and McClung, customer retention is the strongest determinant of organizational profitability and shareholder value. The top four reasons that determine customer satisfaction are: doctor choice, responsiveness, access to medical care, and perceived healthcare cost.

Responsiveness is the second most important factor and the easiest one to improve with QIEM HMOZ. Responsiveness was defined as:

  • Reps follow up on any commitments made to clients.
  • Situations or problems are resolved to the customer’s satisfaction.
  • Responses are quick and efficient.
  • Reps confirm customer satisfaction before ending the conversation.
  • Reps have complete knowledge of Organizations products, services, policies, and procedures.
  • Reps show empathy in upsetting situations.
  • Customer’s self-esteem is maintained during conversation.
  • Reps acknowledge customers promptly and courteously.
  • The administration is easy.

QIEM HMOZ CRM helps reps with all of the above, the only extra component required is a smile for each of your clients.

This study also showed that retention ratio (loyal members vs. switchers) was 2.7 times higher in plans that had great products and services with a low price (best value) than those with low quality products and the same low price. Successfully managed customer relationships can result in a 50+ percent customer retention increase.

Any other key factors in customer retention? The following are case studies where customer relationship management solutions resolved customer retention problems.

Solution – Personalized customer care:

Case 1 – To woo employers and help keep their employees enrolled, Harvard Pilgrim Health Care in Brookline, Mass., created a partnership program that pairs Organizations employees with executives from the plan’s largest employers. The teams help troubleshoot and avert employer attrition.

For example, when Harvard Pilgrim contemplated a premium increase, one team identified several major employers that would leave the plan if rates were hiked. The Organizations met with the team and reached a compromise to retain those employers. In 1997, U.S. News & World Report ranked Harvard Pilgrim the best healthcare organization in the state and third best nationwide.

Solution – Programs and campaigns:

Case 2 – When CareAmerica of Woodland Hills, Calif., looked at its records and local competition, it realized that patients often switched plans without changing doctors. The Organizations saw that it needed to develop a customer-loyalty program based on a direct relationship between its staff and its enrollees.

Targeting its 45,000 Medicare members, CareAmerica began a community-level customer service program that includes separate toll-free numbers and employees for each area, plus problem-solving CareAdvisors assigned to individual members. A year after the program was launched, monthly disenrollment had fallen from 2 percent to about 1.7 percent. That is an increase of 3.6 percent per year.

Solution – Responsive, faster, and more efficient customer service:

Case 3 – Through its annual Health Care Financing Administration audit, Intergroup of Tucson, Ariz., discovered it had the highest disenrollment in the state and the quickest disenrollment of Medicare members. Focus groups, surveys, and interviews showed that unresponsive customer service was a top cause of dissatisfaction among this senior group.

To combat the problem, Intergroup developed a separate customer service unit with specially trained representatives to serve this customer segment. The company also replaced form letters with personalized letters and follow-up calls, and it introduced new-member information classes and in-home interviews with potential disenrollees.

With these new relationship tactics in place, monthly disenrollment dropped from 1.9 percent in 1995 to 0.9 percent in 1997, and rapid disenrollment plummeted from 33 percent to 20 percent. The retention efforts cost Intergroup less than $100,000 and have already brought in savings of nearly $10 million.

In most of these cases, Organizations had to hire additional reps to handle the customer relationship side. QIEM HMOZ can help you achieve the same results without increasing your staff and overspending.


Beyond its proven track record in improving retention rates, QIEM HMOZ customer relationship management is a perfect fit for healthcare organizations.

Using QIEM HMOZ detailed databases, healthcare organizations can divide customers into small, well-defined segments that identify factors such as, which patients value quality of care over price. This kind of segmentation allows healthcare groups to more effectively customize programs, services, and communications on a one-to-one level.

QIEM HMOZ gives you the advantage of having a complete picture about your customers, and a tool that makes you faster and more attractive than your competitors.

One Demo is better than a thousand words, and one Design Audit is better than a thousand demos. We encourage you to follow our CRM proverb and take advantage of this opportunity.