7 Proven Strategies to Increase Profitability of Your Rural Hospital - Part 2

Posted on July 10, 2017

 

rural-health-increase-profitability

By Mike Milligan, The Rural Healthcare Marketer

 

In part 2 of our blog series, Increasing Profitability of your Rural Hospital, I'll address these critical topics:

  • Choosing service lines that are marketable and profitable
  • Implementation of marketing that produces results

In the first part of the blog series, I discussed:

  • Building relationships with referring physicians
  • Forming strategic partnerships

You can read that blog here.

Choosing service lines that are marketable and profitable.

"Dr. Smith wants to be on a billboard."

"We really should be doing more gall bladder procedures. Can you advertise that we can do these just as well as the larger hospitals?"

These are actual requests I've received throughout my career. They are not necessarily unreasonable requests, but ironically in an industry based on science, these questions are based on emotion rather than fact.

How do we decide where to place our emphasis in marketing? Having been a member hospital leadership teams throughout my career, I'm well aware that there are politics. Realistically, when an influential surgeon or board member makes a suggestion, the request does carry some weight often due to the stature of person, even if the idea itself might not be the most thought out.

But as healthcare leaders, our job is to best manage the limited resources of our rural hospital. Decisions should be made based on agreed-upon criteria and alignment with the goals outlined in your strategic plan. And as our clients have often heard me say, "marketing should focus on doing a finite amount of things very well, rather than trying to do a little bit for everyone."

It may or may not make sense to put the surgeon's face on your billboard. But the standard should be defining our goals and developing the best strategy to achieve these goals. Regardless of who or what is on a billboard, the broader question is whether or not this is even the right approach. For instance, general surgery is built through primary care relationships.

It's also developed through direct to consumer promotion, but this is generally focused on promoting procedures where patients may be seeking a remedy to an issue. As an example, campaigns surrounding heartburn or hernias have messages that a prospective patient can identify with. However, your average consumer isn't comparing facilities for the best gall bladder procedure.

While you may appreciate the service provided by the dedicated employees in housekeeping, does this justify spending money on advertising? Absolutely not. But, it might mean that you celebrate their achievements and thank them publicly for their role in caring for your patients.

The point here is that as an organization, you must develop your specific criteria and then weigh, or rank, those criteria depending on your situation. For instance, criteria could include, among many others:

  • Profitability
  • Downstream revenue
  • Competitive advantage
  • Capacity
  • Community goodwill
  • Builds brand of your organization
  • Supports the strategic plan
  • Patient retention

Implementation of marketing that produces results.

Okay, let's say in the end you decided to do that billboard. Then the next question is,

"What is effective?"

How do you know? The short answer is that you only know its effectiveness if you specifically defined your desired outcome in advance.

Most likely, that billboard itself didn't produce the results. But, was it part of a larger effort? Did your surgery volumes go up? Were there more inquiries on your website? Did new potential patients attend a community education event that you promoted?

The takeaway on this point is the forming of measureable, tangible goals. Sometimes these are business goals such as increasing volumes of a specific procedure or service line by a certain percentage. Or it's regarding marketing share, or referrals. Or the goals are communications-focused such as number of website impressions or social media engagement. Every marketing initiative you begin should have a clearly defined goal before you start.

I'll cover these topics in even more detail in this week's webinar, but the key is to use these criteria to make objective decisions about what you will do, and about what you will not do. And, once you know where you're going to place your focus, clearly define your expected outcome.

Thanks for reading, and feel free to reach out to us anytime with your comments or suggestions for other blogs. We love hearing from our readers!

Mike


Attend Our Upcoming Webinar

Register for our upcoming webinar, July 12 at 2:00 CDT "7 Proven Strategies to Increase Profitability of Your Rural Hospital" presented by Mike Milligan, President of Legato Healthcare Marketing. Mike will provide a no-nonsense webinar with practical tips for rural healthcare executives to put into immediate action.

Register Here


 

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