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  1. 1. Physician-to-Physician Marketing: Quickest Channel to Volume Growth May 19, 2010 Alvis R. Swinney
  2. 2. Agenda <ul><li>Physician marketing and the referral “Echo System” </li></ul><ul><li>The value of primary care referral sources </li></ul><ul><li>The revenue driving relationship for hospitals: the specialist </li></ul><ul><li>Should physicians be marketing to referral sources, and why aren’t they? </li></ul><ul><li>Larry Ginsberg , Manager of Loyalty Marketing Programs Meridian Health </li></ul><ul><li>The Meridian Health experience </li></ul><ul><li>Hughes Bakewell , President, PracticPlus LLC </li></ul><ul><li>The “WordOut” physician communications and referral marketing solution </li></ul>
  3. 3. Why Physician Marketing is Important “ While there are good reasons to include prospective patients in hospital marketing efforts, the degree to which the industry has been focused on this segment of the customer base is, arguably, inappropriate.” “ While consumer assertiveness does, of course, vary across service lines and patient demographics, all indications are that physicians are the ones who (by a wide margin) typically determine where a patient ends up receiving hospital treatment.” The Advisory Board, 2005 Source: Advisory Board Study: “Next-Generation Physician Marketing, Increasing Health System Leverage Across the Referral Chain,” 2005, page 3.
  4. 4. Physician Eco-System (Referral Model) Medical Oncologist Radiation Oncologist Medical Oncologist Medical Oncologist Medical Oncologist OB/GYN Medical Oncologist Family Practice Internal Medicine Family Practice OB/GYN Family Practice OB/GYN Medical Oncologist Internal Medicine OB/GYN Family Practice Internal Medicine Family Practice Internal Medicine Family Practice Internal Medicine OB/GYN Hospital-Based Community-Based Community-Based 20-30 20-30 5-6 5-6 5-6 5-6 2-3 5-6 5-6 2-3 2-3 2-3 2-3 2-3 2-3 0-1 2-3 0-1 Consumers Consumers Consumers Consumers Hospital-Based Referrals Referrals
  5. 5. Primary Care to Specialist Relationship Source: Advisory Board Study: “Next-Generation Physician Marketing, Increasing Health System Leverage Across the Referral Chain,” 2005, page 7. Referral Drivers Revenue Drivers Referrals Per 100 Primary Care Physician 1,365 Cardiology 1,960 Gastroenterology 2,686 General Surgery 3,587 Orthopedic Surgery 2,047 Otolaryngology 1,423 OB/GYN 13,069 Grand Total
  6. 6. Value of Top 10 Revenue Drivers Average annual inpatient/outpatient revenue generated per physicians for their affiliated hospitals by specialty – 2007 data Source: “2007 Physician Inpatient/Outpatient Revenue Survey,” Merritt, Hawkins & Associates. $1,335,133 $1,413,436 $1,615,828 $1,624,246 $1,947,394 $1,987,253 $2,100,000 $2,240,786 $2,312,168 $2,662,600 Gastroenterology Obstetrics/Gynecology Family Practice Hematology/Oncology General Surgery Internal Medicine Neuro Surgery Cardiology (Non-Invasive) Orthopedic Surgery Cardiology (Invasive)
  7. 7. Information Sources Used to Select a Primary Care Physician 50.3% Friends Or Family 38.1% Doctor or Other Health Care Provider 34.7% Health Plan 10.8% Internet 9.0% Other Media Source: “Word of Mouth and Physician Referrals Still Drive Health Care Provider Choice,” Center for Studying Health System Change: Research Brief No. 9, December 2008; Nationally representative survey sample was 18,000 people in 9,400 families; funded by Robert Wood Johnson Foundation The Center for Studying Health System Change – 2008 Selection of Primary Care Physician Categories are not mutually exclusive; respondents could select multiple categories.
  8. 8. Information Sources Used to Select a Specialist Physician Source: “Word of Mouth and Physician Referrals Still Drive Health Care Provider Choice,” Center for Studying Health System Change: Research Brief No. 9, December 2008; Nationally representative survey sample was 18,000 people in 9,400 families; funded by Robert Wood Johnson Foundation The Center for Studying Health System Change – 2008 68.5% Referral From PCP 19.9% Friends Or Relatives 18.0% Another Doctor Or Health Care Provider 10.5% Health Plan Selection of a Specialty Physician 6.8% Internet 4.8% Other Media Categories are not mutually exclusive; respondents could select multiple categories.
  9. 9. Information Sources Used to Select a Facility for a Procedure Source: “Word of Mouth and Physician Referrals Still Drive Health Care Provider Choice,” Center for Studying Health System Change: Research Brief No. 9, December 2008; Nationally representative survey sample was 18,000 people in 9,400 families; funded by Robert Wood Johnson Foundation The Center for Studying Health System Change – 2008 73.9% Doctor Performing The Procedure 14.5% Another Doctor 10.0% Friends Or Relatives 7.0% Health Plan 2.5% Internet 2.6% Other Media Selection of a Facility Categories are not mutually exclusive; respondents could select multiple categories.
  10. 10. Specialty Practice Challenges <ul><li>Balancing personal life and practice demands – work hours, time pressures and demands of complex patients </li></ul><ul><li>Finding time to focus on practice efficiency ( expense management ) and productivity ( revenue diversification ) </li></ul><ul><li>Maintaining practice income in an environment of little, if any, pricing elasticity translates into seeing more patients and working longer hours </li></ul><ul><li>. . . It adds up to economic and lifestyle pressures! </li></ul>
  11. 11. Ways To Improve Practice Economics <ul><li>Client Acquisition : Increase number of referring physicians </li></ul><ul><li>Client Development: Increase number of referrals per physician </li></ul><ul><li>Client Retention : Increase duration of physician relationship </li></ul><ul><li>Revenue Diversification : Increase revenues by adding procedural revenues and technical fees </li></ul>
  12. 12. Typical Specialty Practice Situation <ul><li>Specialty practices tend not have programs to support referral development </li></ul><ul><li>Lack the resources , expertise, or time to develop and manage a relationship program </li></ul><ul><li>Practices have the capacity for more volume – incrementally very profitable </li></ul><ul><li>80/20 rule – 80% of the referrals come from 20% of the market potential </li></ul>
  13. 13. Question: Are Physicians Ready? <ul><li>The Meridian Health experiment to develop a physician referral marketing program meant finding out if physicians would… </li></ul><ul><li>Understand the value of a referral marketing program? </li></ul><ul><li>Agree to pay for marketing services? </li></ul><ul><li>Share their practice referral data ? </li></ul><ul><li>Commit to a one-year agreement? </li></ul><ul><li>Sustain the marketing effort and execute 4 – 6 mailings? </li></ul><ul><li>Stay engaged in the process? </li></ul>
  14. 14. Physician Interest in Marketing is High 75% 59% Physicians interested… … but lacking the time Percentage of surveyed specialists indicating an interest in developing marketing skills Percentage of surveyed specialists wanting more time to spend on clinical work Source: “The Medical Practice Center,” available at www.bizjournals.com, July 10, 2005.
  15. 15. Thank you! Next Up… The Meridian Experience

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