22 July 2016

Consumer Directed Care (CDC): Is it an “Uber” Opportunity for Professional Associations?

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The model of Uber is a modern iteration of a guild model and in turn an example of digital disruption influencing the supply of labour to the consumer. If this is correct it has significant implications for care based professions as they will have the opportunity to directly supply services to customers without have to go through a third party employer. As to how these professions respond will have significant implications for the supply of labour in the emerging Consumer Directed Care market.

The Future of Labour Markets: - In servicing the needs of our ageing population the Australian Governments model of Consumer Directed Care advocates for funding to follow the consumer regarding their care needs with its next iteration in February 2017. The current complexity of accessing care often requires health and wellbeing interventions for consumers to be brokered by third parties. Examples are Hospitals, Aged Care and Primary Health Care Networks.

The emerging market of consumer directed care in many cases is being addressing by current providers increasing the sophistication of service delivery, often as an extension of existing practice. In many cases these have a focus on the person attending a service away from their residence, “point of service”. The impact of this practice is demonstrated by the relationship between Labour (people providing the service) attending a place where the service is provided to the consumer such as an aged care facility. This changes when the policy allows for the Service to be provided at point of need i.e. the home of consumers and at their discretion as budget holder.  

The intersection of the internet with government policy on Consumer Directed Care is a fundamental shift away from point of service “in the factory” to point of need such as the consumers home wherever that may be. The significance of this change is professional associations can move back to a guild model as supported by the internet where there is a direct relationship with the customer and the provider at point of need.   Examples of first adapters are “Better Caring”[1] where the consumer through the internet can book a service with the individual provider through a web portal similar to “Facebook”

Discussion: - In 2004, Nobuyuki Idei, Chairman of Sony, stated; “Change is underway in the business-technology world that will be remembered in time like the meteor that hit the earth and killed all the dinosaurs”[2]. Professions, trades and their unions that represent their interests are not immune to this rapidly changing world! A question is being put forward by emerging markets to professional organizations. What is the essence of their business?

  1. The knowledge it has acquired over generations and its relationship with its customer base or
  2. The organizations (Union) which has since the industrial revolution negotiated conditions and wages with a third party employer.

Whilst elements of the existing paradigm of care will continue with recipients going to point of service such as Hospitals and Aged Care, significant growth on care needs will be at point of need as serviced through Consumer Directed Care. Consider the following analogy; the existing operational framework of the profession is like the Qantas airline which created Jetstar to taken advantage of another market segment with minimal oncost to the parent company Qantas. A significant focus of professions through their unions is on campaigning for wages and conditions whilst taking into account with Consumer Directed Care the opportunity (unfolding at a rapid rate) to orientate part of its role as a Guild. This would create a direct association between the professional and patients/consumers through the internet without have to negotiate with a third party employer.   

Conclusion: Professions have been more successful in Brand recognition than a number of competitors by observing the economic rule;

 Price + Quality = Value as perceived by the customer based on confidence, built on trust.”[3]

Current market commentators are talking about the forthcoming “Digital Disruption”[i]…it is here and now. Early adaptors to digital disruption have been Uber[4] with copycat followers emerging such as Better Caring, by establishing a market brought about by the wide spread adoption of the personal computer and internet. To what may seem a fundamental change in the market is rather a variant of what previously existed. There is a saying: - “same same but different” otherwise known as a return to the Guild model to complement the current union role of care based professions. History will judge how existing providers have adapted? 

[i] Digital disruption refers to changes enabled by digital technologies that occur at a pace and magnitude that disrupt established ways of value creation, social interactions, doing business and more generally our thinking. Jun 5, 2013

Bio - Walter de Ruyter comes to the aged care industry with background in health over the past 33 years. This has culminated in gaining experience across a range of vocational disciplines in nursing, midwifery and anesthetics. This vocational experience has been consolidated with a BHA from UNSW supporting his role as a health manager across a number of portfolio’s. His interest has moved to the exciting field of ageing as an Aged Care Services Manager within the South Eastern Region of UnitingCare Ageing. The challenge is to enable services to be responsive to a rapidly changing market through the intersection of Digital Disruption and Policy.

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