Impact of service attributes on customer satisfaction and loyalty in a healthcare context

Abstract

Purpose – The purpose of this paper is to examine the role of perceived service attributes in the development of overall customer satisfaction (OCS) and customer loyalty (CL) in a health-care setting. This paper also sheds light on the role of hospitalist physicians (HPs) and offers suggestions to improve patient satisfaction and loyalty. Design/methodology/approach – A telephone survey was used to collect data from recently hospitalized patients with respect to their HP. Structural equations modeling (SEM) was used to confirm the overall relationships between perceived service quality (PSQ), OCS and CL. The sample was then divided into customer relationship groups (CRGs) based on satisfaction and loyalty measures. Discriminant analysis was used to determine which attributes differentiated most between high and low satisfaction and loyalty groups. Findings – Overall relationships among PSQ, OCS and CL were in conformity with the conceptual model. Findings also revealed that service attributes played an important role in distinguishing between high and low satisfaction and loyalty groups, although some attributes were more important than others and different attributes emerged as being key influencers for satisfaction and loyalty. Research limitations/implications – The conceptual model used is a fairly straight forward model, and we have not considered the impact of individual factors such as expectations and value perceptions or involvement levels and demographic characteristics on service quality and overall satisfaction. The data for this study were provided by a major health maintenance organization (HMO), and there is room for improvement in the manner in which certain constructs were measured. For example, OCS, recommendation and retention all used single item measures, and it might have been preferable to use multiple item measures for these constructs. Practical implications – The study shows that organizations can benefit by identifying and focusing on critical attributes as part of their customer relationship management program. Social implications – The SEM results provide strong support for the overall model linking service quality, OCS and CL in a health-care setting. As one would expect, PSQ has a strong impact on OCS, which, in turn, has a fairly strong impact on CL. However, there is also a significant direct linkage between PSQ and CL. This linkage shows that at least a certain portion of CL could evolve independent of the satisfaction level with the HP. This shows that, in addition to trying to improve satisfaction, organizations should also explore influencing loyalty directly, perhaps by the strategic use of service attribute perceptions. Originality/value – The study shows that customer perceptions at the service attribute level can often be the key to the generation and management of customer satisfaction and loyalty. It also has significance for how satisfaction and loyalty with HPs can be improved in a hospital setting.