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Physician-to-Physician Marketing:Quickest Channel to Volume Growth
May 19, 2010
Alvis R. Swinney
2
Agenda
• Physician marketing and the referral “Echo System”• The value of primary care referral sources• The revenue driving relationship for hospitals: the specialist• Should physicians be marketing to referral sources, and why aren’t they?
Larry Ginsberg, Manager of Loyalty Marketing Programs Meridian Health
• The Meridian Health experience
Hughes Bakewell, President, PracticPlus LLC
• The “WordOut” physician communications and referral marketing solution
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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, IncreasingHealth System Leverage Across the Referral Chain,” 2005, page 3.
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Physician Eco-System (Referral Model)
MedicalOncologist
RadiationOncologist
MedicalOncologist
MedicalOncologist
MedicalOncologist
OB/GYN
MedicalOncologist
FamilyPractice
InternalMedicine
FamilyPractice
OB/GYN
FamilyPractice
OB/GYN
MedicalOncologist
InternalMedicine
OB/GYN
FamilyPractice
InternalMedicine
FamilyPractice
InternalMedicine
FamilyPractice
InternalMedicine
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
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Primary Care to Specialist Relationship
Referrals Per 100Primary 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
Source: Advisory Board Study: “Next-Generation Physician Marketing, IncreasingHealth System Leverage Across the Referral Chain,” 2005, page 7.
Referral Drivers Revenue Drivers
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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)
77
Information Sources Used toSelect 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.
88 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
Information Sources Used toSelect a Specialist Physician
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.
99 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
Information Sources Used toSelect a Facility for a Procedure
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.
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Specialty Practice Challenges
• Balancing personal life and practice demands – work hours, time pressures and demands of complex patients
• Finding time to focus on practice efficiency (expense management) and productivity (revenue diversification)
• Maintaining practice income in an environment of little, if any, pricing elasticity translates into seeing more patients and working longer hours
. . . It adds up to economic and lifestyle pressures!
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Ways To Improve Practice Economics
• Client Acquisition: Increase number of referring physicians
• Client Development: Increase number of referrals per physician
• Client Retention: Increase duration of physician relationship
• Revenue Diversification: Increase revenues by adding procedural revenues and technical fees
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Typical Specialty Practice Situation
• Specialty practices tend not have programs to support referral development
• Lack the resources, expertise, or time to develop and manage a relationship program
• Practices have the capacity for more volume – incrementally very profitable
• 80/20 rule – 80% of the referrals come from 20% of the market potential
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Question: Are Physicians Ready?
The Meridian Health experiment to develop a physician referral marketing program meant finding out if physicians would…• Understand the value of a referral marketing program?• Agree to pay for marketing services?• Share their practice referral data?• Commit to a one-year agreement?• Sustain the marketing effort and execute 4 – 6 mailings?• Stay engaged in the process?
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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.
Thank you!
Next Up…The Meridian Experience