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Making the marketing shift from volume to value

Posted Feb 27 2013 4:56pm

by Tadd M. Pullin

As policy and strategy experts opine about the merits of local market hospital mergers, large regional and national hospital systems, the need for integrated delivery of care across the continuum, and success being defined by empty hospital beds and healthier populations, I can't help but have flashbacks to the early 1990s when I began my career in healthcare administration.

Is it different this time? Will hospitals, physicians and other healthcare providers across the continuum bring it together and truly innovate to make an impact on population health or will the industry distract itself for a few years and go back to its old ways?

This question is pivotal for those leading and innovating in healthcare marketing.

In the 90s, legislation to change healthcare failed to make it through the political meat grinder. Consumers rebelled against HMOs, limited choice and gatekeepers to specialist referrals. In the decade that followed, empowerment of the consumer centered around access to a growing amount of medical information on the web, access to pharmaceuticals and the freedom to choose a provider over another. Employers had to compete for the workforce and they ultimately paid the price in health benefits, with loose networks.

Year after year, employers accepted huge increases in health insurance premiums--largely driven by healthcare providers negotiating higher rates with insurers to offset or subsidize care provided to the uninsured and lower Medicare and Medicaid reimbursement. Hospitals and physicians had no financial incentive to create a true continuum of care, in fact just the opposite.

It would be unfair not to recognize medical and nursing professionals and administrators across the country who, despite the reimbursement barriers, did everything they could to prevent patients from falling through the cracks. And there are those health systems, like Kaiser and Geisinger, that operate a health plan and integrated delivery system focused on promoting health.

But for the most part, U.S. healthcare providers have organized their business strategies and marketing efforts around volume-based growth to remain viable.

What's different in 2013? While one might argue the Affordable Care Act is the major game changer, I'd say it's the convergence of public, social and economic pressure hitting at the same time. Whether legislation being implemented will create the transformation we'll leave for history to judge, but important to note, comprehensive legislation made it through the political meat grinder this time--after stops in each branch of government, including the judicial branch.

This was largely of society acknowledging the current system was unsustainable and something had to change. That may be more important than the actual legislation or the politics surrounding it.

In a nutshell, the change that's coming is real and the shift to value will be transformational. And it won't happen without dramatic changes in how we develop and execute marketing and communication strategies.

At the heart of marketing success is a clear consensus on business strategy and measurable outcomes for return on investment. While healthcare organizations around the country may approach the shift to value in different ways, a few principles are key to keep in mind.

For instance, corporate overhead will be reduced dramatically--including marketing budgets. Consolidation may help in the process. Mass media advertising will still happen, but will be less prevalent.

Social media platforms and mobile Internet strategies will become the dominant platform for innovation, although the secret to differentiated success in this new space is talent--not technical talent, but rather emotionally intelligent, extroverted, relationship building personalities--who demonstrate excellent judgment and have good intuition when targeting audience segments and even individuals.

For health systems aiming to manage population health, this new talent will be immersed in the full spectrum of studying and attracting new enrollees to a network plan, helping people engage in their own health or access seamless preventive and intervening health services, and retaining members over a sustained period of time.

For large tertiary referral centers that aren't assuming risk for population health, these new platforms and supporting talent will be used to cultivate and sustain relationships with referring physicians and other referring providers.

Marketing will be at the heart of any healthcare organization's success in this new environment. To rise to the challenge, marketing and communications leaders must be out in front, not only to be prepared to support new business strategies but also to help internal stakeholders adapt to what's coming.

We have to be comfortable challenging our current paradigms about media, meeting our audiences where they are and where they're going to be in the future. Marketers who achieve differentiated results will be willing to adjust course, experiment and leverage what's working to achieve the organization's business objectives. They will accept and even embrace the fact that they can't know everything they'll to need to know to do this.

There are no experts in healthcare marketing right now, only those who are paying attention, connecting and learning to find success--in the practice of marketing.

Tadd M. Pullin is the vice president of marketing, planning and network operations at The Nebraska Medical Center in Omaha, Neb. He can be reached at tpullin@nebraskamed.com.

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