Analysis: Why Hospitals Are Selling Themselves More Than Ever

Have you noticed this lately? You go to mainstream news sites — like, say, or our own — and see ads (no, wait, in public radio we call it “underwriting”) by local hospitals. I’m not exactly objective about financial support for journalism. The ads gladden my heart. I also couldn’t help wondering: What’s up? In my old newspaper days, you couldn’t sell an ad for a health-and-science section to save your life.

But the world of the Internet is different. Health is among the most-searched-for topics, and all those searches translate into potential patients. Also possibly at work to boost hospital ads: rising competition for privately insured patients and the growth of a smart-shopper mentality among health care users. We don’t have local numbers, but nationally, hospital ad spending has been rising steadily. Here in Boston, you can barely turn on your TV these days without running into an ad about a local hospital or health insurer, whether it’s a Steward “Believe” ad during the Super-bowl or a Partners ad like this one:

I can imagine a lively debate about this phenomenon, at a time of increasing emphasis on cutting health costs. The governor of New Hampshire, Democrat John Lynch, recently complained about hospital ad spending in a budget speech, saying that hospitals were using “excess cash” on ads to grab more patients instead of to cut costs. On the other hand, here in Massachusetts, everyone keeps talking about how certain 800-pound hospitals have a disproportionate share of the market; mightn’t ads help shift that? And to the extent ads convey information beyond pure salesmanship, mightn’t they make for better health care consumers?

Tom Simons of PARTNERS+simons

I spoke recently with Tom Simons, CEO and chief creative officer of the Boston marketing firm PARTNERS+simons, about the local landscape of hospital advertising. Tom, who is also chairman of the Board of Trustees at Mount Auburn Hospital, predicts that hospital advertising will continue to grow here, further spurred by health care reform, and that the tenor of many ads will change as hospitals learn that “patient-centric” messages are the most effective. His firm has recently worked on campaigns for Tufts Medical Center and Emerson Hospital. Herewith, his analysis, lightly paraphrased:

Why more ads now?

There’s an old saying, “If you want to find a Boston teaching hospital, you look for a crane.” But in fact, today, hospital patient volumes are looking like they are into a downward trend — there’s a lot of discussion about this. This is creating an evolving set of conditions that is resulting in some really aggressive marketing:

-Hospitals are very interested in spending to reach and sell patients who have commercial insurance. These are patients who are more willing to make their own decisions about where to go for care, and their medical reimbursement rates are the highest. They have a large number of elective procedures. Patients with commercial insurance have become more important as government reimbursement rates for those with public insurance (Medicare and Medicaid) have not kept pace with hospital cost structures. But don’t get me wrong, all admits and discharges are important.

-There’s huge growth in the availability of comparative data on hospital quality and safety, patient satisfaction and outcomes. We’re seeing the creation of a health-care-consuming public, and these people are increasingly aware that quality is not consistent among all hospitals, and the highest quality isn’t always where we expected.

-One of the most transformative factors has been the eagerness of people to use the Internet to research where they can get good quality care, research their conditions, and so on. Health-related searches are something like the third-most-common online activity.


So if you just connect the dots, there’s so much search going on online, so much research going on online, and this is a marketing channel that hospitals weren’t using as actively five or six years ago. And they’ve realized that as search increases, they need to make sure that their message is a part of the Internet activity their potential patients are involved in.

Measuring Impact

An additional appeal of online ads: If you’re marketing on the Internet and you’ve designed a bullet-proof program, it’s very simple to measure the performance of the campaign through traffic and session lengths and video views. Most traditional advertising is measured by metrics that are not connected to real audience engagement or business outcome. But fastidious marketers can determine the comparative return on investment of online campaigns with a precision that doesn’t exist in other channels.

Some adventurous marketers are even allowing for appointments to be made online. It’s really simple to connect marketing to value when you’ve got a patient that’s created as a result.

Which Medium?

Seeing an ad for, say, Brigham & Women’s Hospital on is the equivalent of a print ad in the health section of the Boston Globe. The challenge is making sure your message is adjacent to content that you think your audience is going to be interested in.

Spot TV is a very traditional channel that gets a lot of use by hospital marketers. It’s still a very effective reach tool capable of carrying an emotional message.

Print? It just doesn’t have the eyeballs now. To be honest, we don’t think about it that much. It’s generally not the most cost-effective medium.

The health reform paradox: Cutting costs means more marketing

The indications that I see are that people are taking more control over the management of their own health care experience. We did research a couple of years ago among Massachusetts health care consumers and we found, without any equivocation, that these people say they are much less likely to blindly follow the referrals of their physicians than their parents were.

They’re more empowered. They have more research tools at their disposal. Skepticism is just more pervasive among all of us for all sorts of reasons.

[module align="left" width="half" type="pull-quote"]

As I look down the road and around the next corner, I think that the industry’s interest in controlling costs is going to drive a continued increase in advertising spending.

[/module]You know from your own reading that there’s a lot of scrutiny of the disparate reimbursement rate structures among hospitals and physician groups – these often don’t correlate to superior quality or outcomes. This is a key payment-reform driver.

We’ve now got global payments and a new set of products coming out that tier hospital and physician groups. Today we have an insurance system that I think of as being free care: you pay your premium and then you get free care whenever, wherever you want. New insurance products are going to become more popular that offer lower premiums for members who get care at hospitals that offer comparable quality at comparably lower cost.

So you’ll have some hospitals, the more expensive hospitals and physician groups, who may not be part of those tiered networks, advertising to build brand value to substantiate their higher costs. I see some laying the groundwork for that now.

And you’ll also have the more reasonably priced hospitals and physician groups who are part of the tiered networks competing against each other for the business that is being routed their way. I think that will cause spending on marketing to increase even as costs are increasingly being managed.

It’s totally paradoxical. It’s incredibly ironic.

A new kind of message

As people become more active consumers, what I think will happen is that the sharper hospital marketers are going to make a distinction between what the hospital wants to say in its advertising as opposed to what the patient needs to hear. You know that hospitals are inclined to advertise the recently opened building, or talk about their world-class care, or their team approach, that kind of thing. Those are fairly simple messages to get through an approval process in a hospital setting. They are intended to make the advertisers feel good about themselvesl.

But what’s important to patient and their families is: Am I going to like my doctor? Am I going to like my nurses? How easy is it going to be to make an appointment? Is parking going to be a pain? Are those hospital rooms noisy at night? And am I going to have just as good an outcome at this hospital as I am at the next hospital? I think that’s a different message than the kind of message we’re accustomed to seeing.

The Tufts Medical Center TV concept is all about making the physicians available in an online environment in which they — in a very real sense — interview for their own hire. The videos are a chemistry test between the potential patient and the physician. In fact, patients can request an appointment online.

I’d also point out that the Emerson Hospital website has a Google map overlay that makes it very easy for patients to get directions to the hospital, and there is a separate smartphone app they can use to get directions to their appointment location within the hospital campus. I think that’s a lot more patient-centric than the heroic shots of some new imaging center or doctors walking down a hallway in slo-mo.

Will hospitals and physician groups tout discounts?

I don’t think any hospital will be willing to say ‘We’re an off-price provider.’ I’m trying to look down the hallway and imagine how varying reimbursement rates will have a marketing and messaging consequence but I’m not sure at this point how it will manifest itself. That said, I’m certain it will be a dynamic that shapes some marketing messages.

How about marketing of “accountable care organizations” or ACO’s, as they form as part of the coming Massachusetts reform?

I think about this a lot in the context of Mount Auburn where the hospital, its physicians and the independent physician group are essentially operating as what we believe will be the ACO model. Whether ACO’s become meaningful to the consumer remains to be seen, but I think that there will definitely be competition among hospitals in the race for the official designation and the business that will follow. I’m not sure the person on the street is going to be thinking, “I’ve got to go to an ACO environment to get my hernia repaired.”

I do think it’s logical to assume that ACO environments are going to attract business that is directed either by government payers or by commercial payers. It’s realistic to expect a better outcome, a better continuum of care, in an ACO environment.

This program aired on March 30, 2011. The audio for this program is not available.

Headshot of Carey Goldberg

Carey Goldberg Editor, CommonHealth
Carey Goldberg is the editor of WBUR's CommonHealth section.



More from WBUR

Listen Live