Ready for the tyranny of healthcare price competition?

The hospital marketing game is changing rapidly driven by easily accessible and readily available price and quality data. Hide one’s head in the sand if one must, but that information in the hands of the healthcare consumer will drive more innovation and change in how hospitals do business and marketing, than anything else imaginable.

Member co-pays and deductibles are rising.  Employers moving to defined contributions.  Millions of individuals have purchased health insurance or entered the market via Medicaid expansion. Healthcare consumers are facing the economic reality that they now to pay along several fronts. Can one really think of any better way to control healthcare costs by introducing a level of price competition and providing information which really up until now, was essentially unattainable?

There is nothing like having higher out-of-pocket expenses, coupled with the ability to obtain price and quality information, to estimate your own costs to get healthcare consumers to pay attention. Shopping for care among providers by price is a purely consumeristic behavior and it's not mystery shopping.

Just because one charges more doesn't mean higher quality.  The healthcare consumer already assumes quality.  And they assume that it is equal across multiple providers. Saying you have high quality or a better experience when you are unable to differentiate yourself in the market, is a claim that falls flat in a price driven market.

Markets based on price competition can be tyrannical in nature and a harsh mistress which is new reality for most in healthcare.  Now, doctors, hospitals and others will need to change their marketing operations and begin to deal on price.  Your brand takes on new meaning when price and choice become a critical component in the healthcare consumer decision-making process.  High price undifferentiated quality won't sell.

If a competitor in one’s market takes the first step and advertises lower pricing for some common diagnosis and treatments, what will be the response? Employers are already identifying providers based on price and quality.  Six million American go oversees for healthcare because it’s cheaper than here. If an innovator like Walgreens or private equity offers some of the same services but at a better price with the consumer in mind, is one ready to compete with that in the market?

Surviving all the change in healthcare is already hard, and unfortunately it’s about to get a lot harder. Competing on price vs. claims of quality requires a different set of healthcare marketing skills than a marketing communications focus traditionally found in most healthcare marketing operations.

Take stock and embrace healthcare consumerism and price competition. Growth is good.

How do you market the big box hospital post reform?

From what I have seen it’s pretty much the status quo when it comes to hospital marketing. Smiling happy patients, fluffy messaging that are all about you, shiny and dramatic shots of hi-tech equipment, new buildings with assorted other visuals, and copy that leaves one with more questions than answers. Not much really in the way of experience, outcomes or framing of expectations that a healthcare consumer could use to make a reasonable decision about seeking treatment.

So given the rapid change and evolution of the healthcare market place, with some wondering if the day of the big box hospital is coming to an end, what can be done by hospital marketing? 

Here are nine marketing strategies for saving the big box hospital.

1.  Brand and competitive position.

Consumers and patients are ready for convenient technology-enabled access to care. Use of mobile healthcare apps is on the rise. Healthcare providers that are capable of identifying consumers needs, and how they want their healthcare needs meet though technology focused on them, will gain new patients and the next-generation of physicians. 

2. Engage existing customers and patients.

An individual is only a patient 1/3rd of the time they come in contact with you.  That is during the diagnosis, treatment and recovery phase.  Pre and post this, they are a consumer not a patient.  So why then is it the only time you meaningfully engage them is during the period when they are a patient?  That doesn't seem like a lot of common sense. Consumer and patient engagement is about all of the time, not just some of the time.  Engaging the individual on a continuous basis builds loyalty and return use or repurchases behavior.

3. Engage the physicians and focus on the physician experience.

No matter the payment model you will still need a physicians or physician extenders order to get anything done in a healthcare setting. That means engaging physicians in meaningful ways, using the methods, technology, and systems that will make their life easier, improve their productivity and protect or increase their income. An effective and efficient physician has more to do with the impact of cost, quality in your organization then may other factors.

How hard is it for a physician or physician extender to practice medicine in your organization?  Understand their experiences overall from beginning to end, not just in isolated care segments. Fix what is broken, keep what is working. The more satisfying the experience, the better you will do financially.

4. Focus on the consumer/patient experience.

A healthcare provider's ability to deliver an experience that sets it apart in the eyes of its patients and potential patients from its competitors - traditional and non-traditional - serves to increase their spending and loyalty to the brand. You need to actively manage the customer experience in total by understanding the customer's point of view.  That is, all touch points internally and externally that a healthcare consumer/patient comes in contact with, which in turn creates the experience. Exceptional experience means gains in market share, brand awareness, and revenue.

5. Embrace innovation in healthcare.

Traditional ways of delivering healthcare are going by the wayside.  Price, convenience, access are the drivers in retail healthcare.  Find the need, understand the consumer’s behavior drivers, design offering around the consumer not you in a convenient location and price it appropriately. If you can't compete in this way, your market position, share and revenue will erode.

6. Agility is the name of the game.

Be nimble. Be agile. Be quick.  Healthcare marketing needs to move from the tried and failed to the exceptional, the innovative, the engaged and the motivational. You can't reach the healthcare consumer on an emotional level to make the right choices, treatment and lifestyle decisions as well as purchase decisions in your favor unless you are sufficiently engaged. .

7. Get moving on the social media program.

A hospital or health system needs to be where the healthcare consumer is living. And the healthcare consumer is on social media finding the information they need to make choices.  Social media is not a billboard, but an efficient and effective engagement strategy that can enhance the relationship.

8. Understand the multiplicity of markets.

You have five markets: Medicare; Medicaid; Commercial; Exchanges; and Uninsured. Baby Boomers are starting to demand that their healthcare experience be delivered their way, the way they want when they want. Retail medicine will continue to expand so tailor the healthcare offerings to the market accordingly. One size does not fit all. Outcomes and price transparency, access and convenience are the future and the future is now.

9. Quality Transparency will set one free.

This is the one that causes the most fear and trepidation among hospital executives and physicians, patients getting access to meaningful quality data that they can understand and use to make meaningful choices. Get ready it's here whether you like it or not, and it's just not a marketing technique. It's the right thing to do. Because if you don't someone else will.  And your quality and price data is out there. All it takes to some creativity to develop a Kayak type web site for healthcare and you're at the bottom of the food chain. No circling the wagons. The genie is out of the bottle and never going back.

If a hospital has no beds, is it still a hospital?

Should healthcare providers change marketing in an era of reform?

Faced with a cacophony of payment models from fee-for-service to value ad risked based with everything else in between, the evolving healthcare consumer and the newly insured, healthcare marketing becomes an even greater challenge than before. One size does not fit all. And growth is good.

The hospital or health system has five markets: Medicare; Medicaid; Commercial; Exchanges; and Uninsured. And in those five markets it’s about:  Sustainability; Presence; Perception; and Experience.

These are the four dynamics that healthcare providers need to understand and incorporate for successful marketing and campaign efforts in a consumer-driven market. In short the answer is yes. No longer nice to have, these four basic concepts are now business requirements:

 ·         Sustainability- The resources to effectively and continuously communicate brand and differentiate the offering across multiple channels

 ·         Presence - By maintaining a continuous presence across multiple channels as in so many other consumer-directed industries is how one builds brand preference

 ·         Perception- With a sustainable, continuous presence in the marketplace, sooner rather than latter, your key messages become the opinion of you by consumers and they become fact in their mind.

 ·         Experience-  The actual customer experience at all touch-points matches the brand image, perceptions and opinions of customers that you created in the marketplace, that have been communicated in an integrated multi-channel sustained effort that includes social media engagement

What to do?

A consumer-directed market is much different environment than a provider-directed market which requires skills and abilities that may or may not exist in an organization.   Key success factors for creating a high performance marketing operation that delivers revenue and market share in an era of reform in the new healthcare environment include:

·          A Vice President of Marketing senior management position that reports to the CEO and is involved in all decision making.

·         Marketing resources human, operational and capital budgets to support a multi-channel effort externally and internally.

·         Comprehensive strategic and measurably focused marketing plan that is integrated with the financial and operational plan of the organization.

·         Price, outcomes and experience transparency

·         Internal communication and training to educate the organization around marketing efforts, expectations and their role in the execution of the plan.

·         Creation of a comprehensive marketing dashboard which communicates activities and results on a monthly basis to all levels of the organization.

As the healthcare providers continue to consolidate across all segments, marketing will assume an increasingly important role in the survival and revenue generating activities for the organization. And that requires a far different innovative sustainable marketing presence that changes perceptions than the old way of doing things.

Can social media drive healthcare consumers to the hospital?

You bet it can and here’s why from this most interesting social media infographic: 41 percent of patients say social media affects hospital choice courtesy of healthcarecommunications.com.   This is really astounding when you consider the financial implications. Even better in the report was that 60 percent of doctors saying social media improves the quality of care. And one in two adults use their smartphone to look up health information as well.

When this information is combined with the Mayo Clinic survey  “Health Care Social Media List,”Social Media Health Network, with so few hospitals participating in some aspect of social media, the discussion is no longer about nice to do, but don’t have the time or lacking the willingness to  tackle the internal political issues, to a business strategy  that can drive the brand, awareness, perception, experience and ultimately revenue.

So who does the healthcare consumer trust in social media driven health information and content?  Doctors are first and that is no surprise at 60 percent. Nurses are in second place at 56 percent. Hospitals come in virtually tied with nurses at 55 percent. 

Only 46 percent of people trust health information from patients they know.  And if they don’t know you as a patient, that trust drops like a rock to 25 percent. Most interesting is that the trust factor for the top three is really only a few percentage points difference.

The point of all this is really to help marketing leadership in hospitals and health systems; have a rational fact-based discussion in their organizations on the impact of social media on the business strategy. This does affect the overall marketing strategy and positioning of the organization.

Marketing in hospitals and health systems isn’t about making things look pretty anymore; it’s about driving revenue, managing demand appropriately and improving the healthcare consumer and patient experience.  And that is not easy by any means.

Social media is more than an app for the Iphone or Android operating system that tells you ER wait times.  Social media is a platform of engagement and innovation. 

It’s not about posting pictures of new buildings or pieces of technologically advanced diagnostic equipment, those can go on Pinterest. It’s about how you develop content in the right context that is engaging, informative, educational, experience enhancing and drives business.  Social media gives a healthcare organization the ability to deliver content directly to the healthcare consumer or patient to meet all those goals. 

The time for waiting is over. The times to act is now, and drive a comprehensive social media strategy into the fabric of the hospital or health system.  The healthcare consumer is out here looking and making healthcare choices, and they can’t choose the hospital or health system that’s not out there in social media.

To blog or not to blog the hospital? That is today’s social media question.

One of the easiest ways for hospital and health system to take advantage of social media is blogging. Thousands of stories of quality care. There are the stories of dedicated and highly educated and trained professional employees.  There are physicians on the medical staff whose collective knowledge and practice of medicine tallies in the hundreds of years, with stories of quality, care and compassion to tell.  Volunteers coming in daily who have heartwarming stories of engagement and loyalty.  Consider the story lines of patients who would freely and willingly tell their stories of successful high quality care, engagement and treatment at the hospital or within the health system.

No additional resources needed for this effort. The communications talent in your marketing department is already in the building, ready to provide compelling content and context surrounding the hospital or health system.

Best of all you control the message.  The hospital or health system can link to the web site. Post to Facebook. Broadcast on twitter. Engage potential employees and followers on the hospital page on LinkedIn. And use the blog as a mechanism for establishing a strong media relations program to develop a press following.

And only 209 hospitals nationwide blog per the Mayo Clinic “Health Care Social Media List”?

I really don’t understand why, and please don’t site HIPAA.  There is nothing in blogging that requires the release of or identification of patient information. That is nothing but a smoke screen used to not engage in social media.

Let me pose to you this question.  How many times has the hospital or health system marketing staff, completed a Google search to see who is blogging and writing about the hospital or health system? Just because an organizations doesn't engage in an aspect of social media, doesn't mean that it’s not happening in the broader community.  Remember that the healthcare consumer is the new paparazzi.

But beyond that little exercise, blogging should be part of the structure of a strategic and fully integrated organizational marketing plan. It’s a method for communicating. It’s a method for building brand.  It’s a method of engaging not only the patient, but the newly minted health insured and the burgeoning healthcare consumer.  They are all out there searching for information, so why not provide them with the meaningful content?

Now that being said, this isn’t about fluff. Oh look at the new building. See our state-of-the-art cardiac cath lab.  Or the ever popular we have wireless internet and HD TVs!  This is about providing meaningful engagement content and using the blog inventively.

Since so few hospitals and heath systems blog, this is really a blue ocean strategy for reaching out and engaging. If a hospital or health system is the first in a market to blog, then the tone, tenor and terms of communication are established via content that has contextual clarity.   And that ladies and gentleman, makes everyone else in the market a me too.

 To blog or not to blog the hospital?  I think the question has been answered.

How can hospitals innovate in the use of social media?

In thinking about social media use by hospitals, I was struck by the innovative actions of Rhode Island Hospital that took Google Glass which was deployed to consumers, and creatively applied the emerging technology to healthcare. Physicians at the hospital use Google Glass with it being the first in the nation application to study its use in real-time bed-side consults.   This story was developed by the newspaper Providence Journal.  They also used YouTube to tell the story. And that is the genesis of today’s topic.

As we have been discussing, and my thanks to all those who have taken the time to share their thoughts in the social media discussion on various LinkedIn groups, social media is little used, but slowly growing in hospitals for patient or healthcare consumer engagement.  For example, Via Christi  is using social media and finding success.

So moving beyond Facebook, YouTube, Twitter and blogs which I would consider to be the basic building blocks and starting points for any social media initiative, how can hospitals and health systems use lessons in social media from other industries to engage the healthcare consumer and patient?

Consider the use of Foursquarefor example. It’s not just a location service that connects to a person’s Facebookand twitter account. It’s a useful tool for business to drive customers and engage the customer.

The other day I was with the family eating at Chili’s Bar and Grill and used Foursquare to check-in. No sooner had I done that, I received a message from Chili’s thank me for dining there and provided us with a free appetizer as thanks.  Then a short while late I received another text message from Chili's asking what they could do for me that day?

What does this have to do with healthcare and healthcare consumer engagement?  A lot.

Whether the hospital or health system or any healthcare provider realizes it or not, they are on Foursquare.  The consumer can add any business they want with a review as well.  Maybe the healthcare consumer statement will be good. Maybe it will be not so faltering. But it will be out there every time some checks in at the healthcare location with Foursquare.  

Beyond that little ditty, here is the Foursquare application to healthcare.  

What if when someone checked into one of the hospital or health system network locations, they received a welcome message?

What if the hospital or health system, was following patients and healthcare consumers on Foursquareand when they checked into a restaurant, sent a wellness message with tips or ideas on ordering from a menu for healthy eating? That is technology driven by the way and someone in the marketing department doesn't have to manually send a message. It’s really 24/7 engagement.

Or when a person checking in fitness clubs a message that encourages the person to continue their efforts at a healthy lifestyle through exercise?

What if the hospital or health system was actively managing its presence on Foursquare and was using that opportunity as a marketing channel for engagement in a host of other areas?

These are just a couple of small ideas on using one aspect of social media. But if the hospital or health system is not engaged and innovatively using social media, you can bet the healthcare consumer is wondering why there is so much silence.