What Is Payer Segmentation?
What Is Payer Segmentation?
Segmentation is the process of dividing a market into subsets of stakeholders who share common characteristics. In the pharmaceutical industry, segmentation of payers is a crucial process that helps companies navigate the complex healthcare landscape by identifying key influencers and connection opportunities to inform market access strategy.
Why Is Payer Segmentation Important?
Payer segmentation allows pharmaceutical companies to differentiate their approach to payers, ensuring more successful interactions. By understanding which healthcare payers have the greatest impact on coverage decisions, pharmaceutical clients can enhance their market access efforts. This is particularly vital in targeting thought leaders across national and regional payers, integrated delivery networks (IDNs)/health systems, employer groups, benefit consultants, and clinical pathways committees.
Payer segmentation enables companies to craft tailored engagement strategies to each segment of payers, focusing on their unique characteristics and priorities. To do this, payers are divided into distinct groups by archetype personas. These personas allow insight into the decision-making within and across segments. For example, payers with very high proportions of Medicare or Medicaid lives are likely to prioritize pharmaceutical budget impact. Similarly, payers might be segmented based on their demonstrated preference for a competitor product, indicating that segments with high preference may be unlikely to adopt and/or prefer new products within the same market basket.
How Is Segmentation Performed?
The segmentation process includes 5 stages, as described below.
- Strategy: Defining key imperatives for engagement and identifying the stakeholder types of most importance for the engagement
- Collection: Mining publicly available data to identify key variables that will be used to differentiate between stakeholder segments
- Segment: Develop a segmentation clustering model based on the collected data
- Refinement: Tweaking segmentation analysis based on client feedback and insights from client or internal experts
- Rollout: Development and delivery of a comprehensive stakeholder map and workbook covering the engagement strategy for each unique stakeholder segment
At Magnolia Market Access, we utilize a data-driven cluster analysis methodology process involving collection and identification of variables, performing analyses, and creating actionable insights for clients. This methodology allows companies to better understand unique dynamics within different payer groups, driving more effective market access engagement.
Key steps include:
- Variable Collection: Identifying potential variables from strategic imperatives, secondary market research, and a claims data review
- Variable Identification: Narrowing the list of key variables through correlation and standard deviation analysis
- Analysis and Refinement: Running the clustering algorithm and refining results with stakeholder input
- Persona Creation: Using quantitative and qualitative insights to name and personify each cluster
Our approach combines both general market trends and disease-specific variables to provide a comprehensive segmentation that captures both broad and specialized payer characteristics.
Implementing Payer Segmentation
Segmentation analysis culminates in a comprehensive segmentation model, heat map, and key insights deck. These tools provide actionable intelligence, focusing not only on who to target but also highlighting why these entities represent key opportunities. The goal is to provide a comprehensive and actionable strategy for approaching payer negotiations. Biopharmaceutical companies may benefit from payer segmentation by tailoring payer engagements through the lens of payer concern, preferences, population characteristics, and geographic/regional characteristics. Interested in learning how a segmentation may supercharge your market access strategy? Contact us today for more details.