Marketing and the Healthcare System

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Marketing and the Healthcare System

HSA 305

Nov 17, 2015

Marketing is essential for all health care companies, including Banner Health. This company is a non-profit provider based in Arizona with operations around the Southwest. In a competitive marketplace, all health care companies need to find ways to attract both payers and patients to their business. Payers are important because there are some payment models that are based on whether a provider is in a given network or not. Being able to attract individual patients can also be quite useful sometimes especially customers who are cash payers. An example of how important marketing is can be seen with the facility that Banner recently built in Boulder, CO. That community was already well-served with another provider (Armbrister, 20120. What this meant was that while Banner could expect some business based on the growth of the community, it should also have had a strategy to both win patients away from the existing facility and to attract them to the area, perhaps drawing from other communities within an hour or so.

Marketing has a direct impact also in terms of directing people to specific alternatives. Banner can, for example, market a specific procedure, and literally convince the customer to seek out that procedure as a solution, having already established some level of trust in Banner and having already established that Banner has excellence at that procedure. This type of approach allows companies in health care to focus their marketing efforts on the sort of high value procedures and conditions that really allow them to maximize their financial position in the market.

For any company, but especially a provider of health care, it is important to understand that rate of utilization of its services. This information can help management with its strategic decision-making function. The first thing in the plan is that the company has to understand what its objectives are. That is what will guide this entire process. If the company wants to improve its capacity utilization, or if it wants to improve its revenue per bed. The second step is to determine what measures it wants to utilization. The third step is to find ways to measure those things. When this is done, the company will have e better idea of what its utilization is. There are a lot of ways to look at this issue. The provider may be curious about the breakdown of its market by payer, or by condition, or by geography. There are many different ways for a business to understand its market. IN particular, when the market is competitive and not every area is profitable, the provider needs to understand on what services it makes money and on what services it does not. Knowing these things will help it to make better decisions about its capability utilization going forward. But the strategy for understanding utilization depends on determining what the best measures are, and how those things can be measure d – gathering data is an important part of this process.

For Banner, a marketing strategy would then be based on the information that it gained from learning about its utilization. Banner needs to determine where the profits lie. As a non-profit provider, Banner likely provides a range of services to the community for which it is not adequately remunerated. So for Banner, the marketing objective has to be to bring in more customers (payers) that are profitable. Increasing share is another marketing objective, and ensuring optimal capacity utilization should also be one of the marketing objectives.

One of the determinants of customers who pay cash is name brand. Those customers are drawn in my advertising, and by recommendations from either people they know or other health providers (referrals). So a lot of the marketing work that Banner needs to do is at the wholesale level, dealing with others in the industry. Some billboard ads would also be valuable e- in the Southwest, public transportation networks are generally weak and high value customers drive everywhere. Moreover, there is some leeway for television or radio spots, perhaps targeting snowbird-types who as a means of getting business from people who are only in the area temporarily.

Banner Health should also consider some form of social media marketing, to help position the brand as a go-to for certain types of high value treatment. The social media campaign can be subtle, but over time it will pay off. The biggest issue with this today is that there is really no great model of social media marketing in the health care industry. Nevertheless, this is a key emerging area in healthcare marketing (Hawn, 1009).

Another element of marketing strategy is the potential to use marketing communications, and marketing communications forms, to inform and engage the audience about their health care choices (Kay, 2007). Healthcare marketing often seeks to educate to some degree, but there is room for expansion of this concept. One of the reasons why this should be focal point for Banner is that consumers often want to have a high level of trust in their healthcare provider – by demonstrating trustworthiness as an essential component of a promotional plan, Banner can help itself to become that trusted provider for more people.

In conclusion, Banner health has a strong market position, but may need to work at marketing in order to expand its market position further. To do this, the company will first need to understand its current position. Thus, it needs to define measures and methodologies by which it can understand its present utilization rates. Then, it needs to determine what its marketing objectives are – often to fill unused capacity. From that point, the strategy will need to focus on building trust with the market, and seeking specifically to fill capacity where there are profits to be had. By doing these things, Banner can continue to position itself from a marketing standpoint for the future.

References

Armbrister, M. (2012). Just what is Banner Health planning? BizWest. Retrieved November 18, 2015 from http://bizwest.com/just-what-is-banner-health-planning/

Hawn, C. (2009).Take two aspirin and tweet me in the morning. Health Affairs. Vol. 28 (2) 361-368

Kay, M. (2007). Healthcare marketing: What is salient? International Journal of Pharmaceutical and Healthcare Marketing.. Vol. 1 (3) 247-263.




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