patient segmentation peter simpson principal february 2014 · –purging, puking, poisoning,...

Patient Segmentation

Peter Simpson

Principal

February 2014

Segmedica, Inc. 935 Sheridan Drive, Tonawanda, NY 14150 – Phone: 716.754.8744 Dissemination, distribution or copying of this PowerPoint presentation or the information

herein is strictly prohibited. © 2012 Segmedica, Inc.

2

Why Segment?

Fairly obviously because different type of customers have different:

• Needs

• Channels of communication

• Price points

• Perceptions and bias



3

Why Segment?

In your case you have to manage:

• Presentation

• Attendance

• Follow up

• Compliance



4

We All Segment

Demographics

Non-verbal cues

I hope this guy is helpful!

Can she solve my problem?

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&docid=EiZqNokI0Pgg4M&tbnid=YZd5w3lFb_MP4M:&ved=0CAUQjRw&url=http://www.texasobserver.org/rick-perrys-refusal-to-expand-texas-medicaid-program-could-result-in-thousands-of-deaths/brackenridge_hospital/&ei=0WoDU9qMGPi-sQTyioKgCg&bvm=bv.61535280,d.aWc&psig=AFQjCNElSIbqmIiWYlEsy6gULSdxWAKEqg&ust=1392819170067707

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&docid=EiZqNokI0Pgg4M&tbnid=YZd5w3lFb_MP4M:&ved=0CAUQjRw&url=http://www.texasobserver.org/rick-perrys-refusal-to-expand-texas-medicaid-program-could-result-in-thousands-of-deaths/brackenridge_hospital/&ei=0WoDU9qMGPi-sQTyioKgCg&bvm=bv.61535280,d.aWc&psig=AFQjCNElSIbqmIiWYlEsy6gULSdxWAKEqg&ust=1392819170067707



5

Segmentation in Daily Life

• Nuanced and subtle

• Verbal and non-verbal

• Instinctive

• Experiential

• Based on our needs– Rational

– Emotional



6

Connection – An Important Word

• In the end, everybody seeks connection– Family

– Romantic

– Group

– Professional

– Common interest

• Everybody has concerns about the resources for living

• These ancient behavioral drivers are relevant today



7

Rational, easily discussed, subject to

persuasion and modification, easily put

into words

Powerful,

latent, not

easily

expressed, not

negotiable,

source of

emotions

Maslow’s Hierarchy of Human Needs



8

Segmenting Patients



9

Compliance is Multi-Faceted and Complex

• There is no one or easy solution

• Compliance remediation consists of identifying psycho-behavioral segments where remediation is cost-effective

• For those amenable segments there are effective and practical solutions

Disease

Severity

Psycho-behavioral Segments



10

Consumer Decision-Making in healthcare

Assumptions are often made that consumers are rational

Therefore if we provide them with information to inform them and tools to help them, rational healthcare decisions follow



11

So if healthcare consumers make rational decisions, why do people:

Skip medications?

Eat foods that they know are not good for them?

Have pets when they know they are allergic to them?

Postpone seeking help when they suspect that something may be seriously wrong?

Continue “screwing up” even when they end with very bad things?



12

Logic, Rationality and Control

• Humans will swing between group acceptance and autocontrol throughout their lives

• Humans are very good at being logical

• Logic proceeds from a premise (beliefs, assumptions)

• Recent research suggests that our brains supply beliefs and assumptions into our logical process faster than we can discern, edit or validate



13

The Brain

Cerebral Cortex

Amygdala

All decision making involves

the Cerebral Cortex and the

Amygdala. Stimuli are passed

to both via the Thalamus and

then separately from the

Cerebral Cortex to the

Amygdala. The input of both is

important to any decision

outcome

Thalamus

13



14

Patients Logic is Generally Very Good

Logic

Assumptions

Experience

Heuristics

Resources



15

Drug Compliance and Rationality

• Non-compliance is not necessarily irrational or harmful

• Examples of highly rated cures (in the past)

– Purging, puking, poisoning, puncturing, cutting, cupping, bleeding, blistering, shocking, heating, freezing, sweating and leaching

– Fen-phen, Vioxx, Thalidomide, Pentylenetetrazol (and about 70 others)

• “If their memories were better they would trust us even less” (Chapin, 1915)

• What is non-compliance?

– 80% compliance is generally sufficient to adequately control blood pressure (Vetter, 1985) and eradicate strep throat in children (Olson, et al 1985)



16

Unspoken Assumptions

1/3 of consumers do not fully believe their physician has their best interests at heart when prescribing

1/3 (mostly the same people) do not always take their medicines as prescribed

Only 1/2 believe their physician is financially independent of the Pharma companies

Less than 1/5 would trust a health insurance company to make the right decision about their health

1/2 believe that Pharma companies are more concerned about making money than helping people

Source – Segmedica Consumer Confidence Surveys….Representative US

sample n=2400



17

Our Decisions are Very Contextual!

I’ll take the

cheapest Policy!

Take me to the best

Hospital!

Do you have a

Generic?

http://thumbs.dreamstime.com/z/uk-pharmacist-serving-senior-man-pharmacy-23958519.jpg

http://thumbs.dreamstime.com/z/uk-pharmacist-serving-senior-man-pharmacy-23958519.jpg



18

When “consumers” become patients, health decisions take on even more importance

Patients are often scared or under stress

People around them such as family and friends are worried

about them too

Patients want to be ‘fixed’ making it

difficult to weigh the risks and benefits of

treatments

Information is asymmetrical even in the

internet age – patients are at a disadvantage in

medical knowledge, although does not

always preclude from making poor decisions

For those that look for information, there can

be information overload, with indeterminable

reliability

Multiple decisions with unknown but

life-changing consequences are

often involved

Decisions are often made in unfamiliar settings, i.e.,

a healthcare setting, under time pressures, the context of highly

charged emotions



19

Some Common Unconscious Process (Heuristics)

Heuristic Definition Example of Effect

Anchoring The tendency to rely too heavily, or "anchor," on one trait or piece of information when making decisions.

Drug X gives me unpleasant side effects, therefore drug X must be bad for me and I will not take it. (Patient anchors adherence decision on knowledge of side effects)

Availability A phenomenon in which people predict the frequency of an event, or a proportion within a population, based on how easily an example can be brought to mind (e.g. using anecdotal evidence to “prove” an entire proposition)

A person argues that a medication is harmful after hearing a news story where someone was admitted for an adverse reaction. Even though it may be unusual, it is most available info

Representativeness Judging the probability or frequency of a hypothesis by considering how much the hypothesis resembles available data as opposed to using mathematical calculations.

Drug X was not able help my friend, therefore drug X must not be able to help anyone, including myself.



20

Some Common Unconscious Process (Heuristics)

Heuristic Definition Example of Effect

Loss Aversion The disutility of giving something up is greater than the utility associated with acquiring it

Preserve what health I have rather than risk adding a side effect to my life to acquire future health.

Hyperbolic Discounting

Disproportionately giving priority to the present over future outcomes

In chronic prevention the theoretical long term benefits of medication do not outweigh current costs/risks

Representativeness(Gambler’s Fallacy) –

Judging risk based on appearance of trends rather than base-rate info.

Drug X was not able help three of my friends, therefore it must not be able to help anyone, including me.



21

It’s more important to know what patient has the disease than what disease the patient has

Sir William Osler

http://en.wikipedia.org/wiki/File:Sir_William_Osler.jpg

http://en.wikipedia.org/wiki/File:Sir_William_Osler.jpg



22

Segmentation Techniques



23

Traditional Qual/Quant Approach

• Qualitative Interviews to direct the design of a Quantitative survey leading to statistical modeling

• Large amounts of data are collected

– Behaviors

– Attitudes

– Demographics

• Latent Class Cluster techniques are used to derive “latent” segments that cannot be found by univariate means



24

What’s Wrong with Behaviors and Attitudes?

Behaviors and attitudes are conscious and transient

• They are subject to self edit

• By the time you come to execute on them they have changed

We need to segment on variables that are truthful and enduring



25

Why Needs Based?

Attitude/Behavior Based

Behavior is what we seek

to change

Attitudes are:

• Transient

• Self edited

• Difficult to execute against

Needs Based

Personality based

Non-negotiable

Relevant

Triggers for emotional connection

Enduring



26

Needs Based Segmentation Design

Needs Variables presented in a discrete choice model

Demographics

Attitudes

Behaviors

Needs Based Segments

Profiling

variables



27

Simple or Sophisticated? The Central Choice

Behavioral

Simple

Quick

Profile lists

No guidance on why

people behave as

they do

Needs Based

Sophisticated

Takes time

Profile individually

Tells us why people

behave as they do

and how to change

behaviors

Behavioral and

Attitudinal



28

Seven Principles to Use

1. Involve all stakeholders from the beginning

2. Design from the implementation backwards

3. Initial qualitative should be focuses on needs analysis

4. Rigorous design

5. Expert analysis

6. Apply judgment

7. Implement wisely

Segmentation Case Study

The Dyslipidemia Case



30

The Dyslipidemia Case

• A statistical modelling analysis of 1200 patients

– 500 diagnosed and treated

– 500 diagnosed and not treated

– 200 at risk

• Qual/quant format

• Needs based

• Choice Model driven



31

Segmentation Drivers

• A range of product attributes were

identified through the qualitative

research and conversations with

the Dyslipidemia Brand Teams

• These attributes were scored by

respondents in a cascade model

• Using Latent Class Cluster

Analysis, it was found that these

17 attributes were the key

discriminating needs variables in

determining the segments

Need Product Attribute CategoryRational – reduce overall cholesterol

Emotional – long and healthy life – fulfillment

of ambitions

Aggressively treats all of my key cholesterol

elements

Efficacy

Ditto Overall effectiveness Efficacy

Emotional – feeling I did not do irreparable

harm to myself - guilt

Reverses build up of plaque in my arteries Efficacy

Rational – reduce overall cholesterol

Emotional – long and healthy life – fulfillment

of ambitions

Is proven to reduce the risk of a heart attack Efficacy

Ditto Reduces LDL Efficacy

Ditto Best in reducing triglycerides Efficacy

Ditto Raises HDL Efficacy

Emotional – fear of drugs Is safest to take with my other medication Safety

Rational – desire for current health Minimal side effects Safety

Emotional – fear of drugs Has the most research and data supporting it Safety

Ditto Has been on the market a long time Safety

Rational – now a single treatment can help

me

Is the first treatment that effectively treats all

my cholesterol issues

C/C

Emotional – fear of drugs (perceived less is

better) – taking twice a day implies my

condition is more serious

Has once-a-day dosing C/C

Rational – now a single treatment can help

me

Combines two proven cholesterol

medications into one pill

C/C

Emotional –need to conserve resources Is available as a cheaper generic C/C

Ditto Costs less than $1 per day C/C

Ditto Has a money-saving coupon available C/C



32

Overall effectiveness

Aggressively treats all of my key

cholesterol issues

Reduces LDL

Best in reducing triglycerides

Raises HDL

Reverses build up of plaque in my

arteries

Is proven to reduce the risk of a

heart attack

Minimal side effects

Has been on the market a long

time

Has the most research and data

supporting it

Is safest to take with my other

medication

Has once-a-day dosing

Is the first treatment that effectively

treats all my cholesterol issues



Is available as a cheaper generic

Has a money saving coupon

available

Costs less than $1 per day

The Needs Variables Clustered into Three Distinct Groups of Variables – Safety, Efficacy

and Cost & Convenience – This Sharpness Arises from Using a Choice Model

Safety

Efficacy

Cost/Convenience



33

Overall effectiveness

Aggressively treats all of my key

cholesterol issues

Reduces LDL

Best in reducing triglycerides

Raises HDL

Reverses build up of plaque in my

arteries

Is proven to reduce the risk of a

heart attack

Minimal side effects

Has been on the market a long

time

Has the most research and data

supporting it

Is safest to take with my other

medication

Has once-a-day dosing

Is the first treatment that effectively

treats all my cholesterol issues



Is available as a cheaper generic

Has a money saving coupon

available

Costs less than $1 per day

Latent Class Analysis Shows Four Distinct Consumer Segments (n=1202)

Each blue diamond

represents the center of

the segment’s position

according to the latent

class cluster analysis

run on the needs

variables shown

Segment 4

Segment 1

Segment 2

Segment 3

Safety

Cost/Convenience

Efficacy



34

Individual Respondents on 4-Segment Consumer Positioning Map (n=1202)

Each dot represents an

individual respondent’s

position according to

the latent class cluster

analysis run on the

needs variables shown

Safety

Cost/Convenience

Efficacy

Each segment shows as

a density of patients

with a halo of patients

whose needs are least

focused

The red dots indicate the mathematical center of each segment and are shown relative to the size of the segment.



35

Segment Names & Overview

Segment 1

Long-term

Wellness

Segment 2

Live for Today

Segment 3

Overwhelmed

Segment 4

Reassure Me

What do they

want?

Long-term

wellness

Wellness today Solve my other

problems first

Reassure me

that the cure is

worth the risk

How do they

operate?

Self-informed

Guided by

physician

Long-term view

Guided by self

Live for today

Overwhelmed

Doesn’t trust

physician

Other priorities

Need a leader

Prevaricates

Doesn’t trust

physician

Emotional

Modality

Confident Impulsive Depressed Skeptical

What are their

major drivers to

act?

Desire to have

long-term health

and functionality

Satisfies today’s

emotional needs

None directly

related to

cholesterol

Confidence in

drug/healthcare

provider

What are their

major barriers?

None directly

related to

cholesterol

Not thinking

about the long-

term

Cannot deal with

one more issue

in their lives

Skepticism of

drugs and

physicians, fear



36

Motivators and Barriers to Action Illustrate the Differences Between Segments

Motivators (in green) & Barriers (in red) Interpretive, not statistically significant

Long-term

Wellness)

Live for

Today

Over-

whelmed

Reassure Me

Wellness X

Functionality in Life X X

Longevity - Family X

Appearance - Obesity X X

Trust in Physician X

Strong relationship & Communication with Physician X

Currently on Treatment X

Partnership/Marriage X X X

Current Symptoms X

Concern About Long-Term Effects of Disease X

Time X

Long-Term is Not Important X

Feeling Rushed at Doctor’s Appointments X

Skepticism and Distrust of Physicians X X

Not Remembering or Understanding Doctor’s Advice X

Feel the Need to Lead in Physician-Patient Relationship X

Not Aware of the Consequences of Disease X

Lack of Healthcare Insurance X X

Cost X X

Current Addictive and Unhealthy Behaviors X X

Lower Rate of Diagnosis X

Not Currently on Treatment X X

Believe all Drugs have Side Effects X

Not Believing that Rx’s are Necessary for Health X



37

Motivators & Barriers Interpretive, not statistically significant

Long-term

Wellness

Live for

Today

Over-

whelmed

Reassure Me

Wellness X

Functionality in Life X X

Longevity - Family X

Appearance - Obesity X X

Trust in Physician X

Strong relationship & Communication with Physician X

Currently on Treatment X

Partnership/Marriage X X X

Current Symptoms X

Concern About Long-Term Effects of Disease X

Time X

Long-Term is Not Important X

Feeling Rushed at Doctor’s Appointments X

Skepticism and Distrust of Physicians X X

Not Remembering or Understanding Doctor’s Advice X

Feel the Need to Lead in Physician-Patient Relationship X

Not Aware of the Consequences of Disease X

Lack of Healthcare Insurance X X

Cost X X

Current Addictive and Unhealthy Behaviors X X

Lower Rate of Diagnosis X

Not Currently on Treatment X X

Believe all Drugs have Side Effects X

Not Believing that Rx’s are Necessary for Health X

Positive

Negative

Motivators and Barriers to Action Illustrate the Differences Between Segments



38

What Did We Learn?

• Relationships– People with high levels of self actualization (Maslow) have a

motivation to prolong life and functionality

– People with low levels of actualization are focused more on today’s problems

– People with a lack of confidence or high level of anxiety and distrust prevaricate between the disease and cure



39

Qualitative Segmentation



40

Qualitative Segmentation – When and Why?

• Small HCP specialties or rare disease states, where a minimum 600 patients cannot be sampled

– Examples:• Rheumatologists (3,300 in practice)

• Endocrinologists (3,500 in practice)

• Genetic disease patients

• Etc.

• Budget and or timeline too short

• “Respondents” are institutions, not people

• Project is to deepen an existing segmentation



41

Qualitative Segmentation – Guiding Principle

• Usually requires a “quantitative backbone”

– A web survey or scoring questions within the interview

• The in-depth qualitative work substitutes for mathematical modeling

• The interview guide needs to be highly structured and interviews need to be consistent



42

Example of a “By Eye” Cluster Model

Grieving Process Denial Anger Bargaining Depression Acceptance

Family Affairs Unable to consider Early stage

consideration

Active

arrangements

Arrangements

completed

-

Relationships Initial alienation Independent

operating

Rebuilding Unity Unity with

acceptance

Finances Unable to consider Struggling Strategy and

information

seeking

Active

arrangements

Under control/Was

never an issue

Clinical

information

Unable to consider Passive receiver Active seekers Active

communicator

Superior performer

Depression and

Anxiety scales

High - - - Low

Terminal Patients



43

Example of a “By Eye” Cluster Model

Grieving Process Denial Anger Bargaining Depression Acceptance

Family Affairs Unable to consider Early stage

consideration

Active

arrangements

Arrangements

completed

-

Relationships Initial alienation Independent

operating

Rebuilding Unity Unity with

acceptance

Finances Unable to consider Struggling Strategy and

information

seeking

Active

arrangements

Under control/Was

never an issue

Clinical

information

Unable to consider Passive receiver Active seekers Active

communicator

Superior performer

Depression and

Anxiety scales

High - - - Low

Terminal Patients



44

Combining Physicians & Patients Segmentations

• Physician and patient segmentations can be design to fit together and matched

– What kind of physicians see what kind of patients and how do they manage them?

– One tactic that can arise is educating physicians to recognize patient segments and optimally manage them for compliance and adherence



45

Segmenting Physicians & Patients Together

• Segments physicians and patients in a single, integrated model

• Groups according to likelihood to prescribe and likelihood to comply

• Segments by the relationship between physicians and patients

• Discovers segments made up of a variety of factors –behavioral, psychological, demographic



46

Example of HCP-Patient Segmentation

MD Likes Product

MD does not Like Product

MD Likes Product

MD Does not Like Product

Effective “selling” to Patients Ineffective “selling” to Patients

Patients Confident Not-Confident Confident Not-Confident

Likely to be prescribed and take. May be non-compliant

Unlikely to be prescribed and will any case be non-persistent

Likely to be prescribed, less likely to take. May be non-compliant

Unlikely to be prescribed and will any case be non-persistent

Tactics Promote compliance

Market product and promotepersistence

Promote more effective patient management and compliance

Market productand promote more effective patient management andpersistence



47

Number of Segments

• Large datasets will produce multiple solutions

– 2,3,4,5,6,7,8 and up segment solutions

• Segmentation is an approximation

• The fewer segments we choose the more of an approximation the model is



48

Segmentation “Tightness”

Resp ID#

Seg 1 Seg 2 Seg 3

1 100%

2 100%

3 100%

4 90% 10%

5 80% 10% 10%

6 50% 25% 25%

7 33% 33% 34%

Example Confusion Matrix



49

Checklist of Essential Outputs

• Segment Descriptions using profiling data as well as segmenting data

• Vector Maps

• Typing tool

– Full algorithm

– Decision tree logic (if applicable)

– Defining variables and coefficients

• Confusion matrix



50

The Essence of Segmentation

• The essence of segmentation is not finding the most complex statistical solution, it is about framing the study in the most economical and elegant way to discover real groups that make sense and can be executed against

• Two tools for developing superior segmentations are:

– Needs analysis

– Cascade questioning



51

Summary



52

Segmentation

• Segmentation is a useful tool but…

• …it must be carried out in a specialized and disciplined way

• They come in all shapes and sizes

• You can have different segmentations for different purposes

• Key things to remember…



53

Segmentation

• …needs based is the most fundamental approach, but everything depends on your purpose

• Do not think if it as a routine “market research” assignment

• Team involvement, crystal clear thinking and forward vision are all essential



54

To learn more and share ideas and experiences around the healthcare consumer register for VISION 4.0

One day conference June 17th Bridgewater, NJ Marriott

Chair – Charlotte Sibley

Keynote – Dr. Jeffrey Brenner of the Camden Healthcare Coalition and 2013 McArthur Genius Award Winner

Completely free to all manufacturing/insurance companies

Will include attendees from Health Insurance, OTC, Nutraceuticals

Sign up at Segmedica.com or Vision-4.0.com

VISION 4.0 Understanding the Healthcare Consumer



55

Segment 1 (Small)

Segment 2(Ind./Less Prog)

Segment 3(Ind./More

Prog.)

Segment 4(Cent./More

Prog.)

Segment 5(Large Teaching)

# of beds 100 beds or less 101 -406 101-629 123-561 Range 537 –1003

Location Primarily rural Primarily urban Mix/slightlymore rural

Primarilysuburban

Primarily Urban

Public perception IntimateFamily

Immediate resource

Mid-sizedExpert

Perhaps inconvenientInstitutional

TitanicExpertSavior

Last resort

Patient perception FriendlyCommunityConvenient

Good attentionLike the doctors

BureaucraticLots of time – do I see a doctor?

Food’s good

AweFearHope

Customer service FriendlyCommon

background

ProfessionalPatchy

DistantPatchy

Hospital Segments: Summary



56

Linguistic Analysis: Hospital Segmentation

Segment 1: physician/medical

is central to discussions

Segment 2: drugs and

physicians are highly

associated – also close to cost

Segment 3: quality and data

are central to discussions

Segment 4: strong

association with the hospital

and less focus on physicians

Segment 5: Close to

data/processes and in-

between hospitals and

physicians

patient segmentation peter simpson principal february 2014 · –purging, puking, poisoning,...

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