As a concierge physician (regardless of what you call it these days, boutique medicine, membership practice, personalized medicine or something else) if you’ve pulled out of most of your managed care agreements, you’ve lost patient steerage that you were trading in exchange for the discounts you negotiated. Ok, so you’ve made that choice but now you will have to replace that steerage mechanism with an other effective way to get patients and members in the door. Some of my clients who pulled the plug on their managed care panel participation didn’t realize that that was indeed the trade off and why they were accepting the discount. So instead of “feeling” the discount in the contractual adjustment whenever you performed a negotiated service, now you’ll need to write a check for marketing, website creation and maintenance, brochures and advertising.
There’s one option in the “realm” of marketing options for physicians that rarely crosses the mind of most physicians: Public Relations.
This may occur because a) physicians were never trained on marketing, or b) they don’t quite understand how Public Relations figures into a marketing strategy firing on all cylinders. If you were a “managed care practice”, chances are high you didn’t need to do much marketing, advertising or public relations. People checked their health plan directory, chose a physician and scheduled an appointment. The business was mostly “service” oriented and other than your reputation and renown in the community, because of the fee schedule and terms and conditions of sale as a managed care provider under a negotiated fee schedule, you were essentially a commoditized, easily substitutable service provider. (Ouch! The truth hurts…I know.) People picked you from a list of who was close, who gave the discount and participated in their plan.
Now you are in a "premium product"- oriented business that includes the services you used to offer but with a premium price tag
In the design of your new concierge medicine practice, the first of many exercises was to rethink this commoditized, substitutable service provider positioning and replace it with something special – a premium brand differentiator. That’s because without paying for the membership, the former commodity buyers can no longer continue to receive service. They are forced to choose a substitute from the list offered by their insurance plan.
Your new “product” is the package of extra amenities program you sell along with the prestige people should “feel” when they agree to pay for it, among other things.
The “service” is your professional skill and bedside manner, diagnostic and treatment services coded with CPT codes, and the customer service delivered by your staff. But they cannot buy the service without the rest of the package. Who is supposed to take the time to explain all this? You? Your staff?
Enter the Public Relations professional.
Public Relations professionals do far more than write press releases. But that is only one of their tools. Kind of like your BP cuff and your thermometer. One misconception that many physicians hold is that Public Relations is all about advertising your practice so more people will buy a membership. Another percentage believes incorrectly that public relations is about promoting what your business is about. That’s called “promotion” but that’s not accurate at all. Promotion is a result of effective public relations. Lots of people pay for public relations professional services and don’t get promotion because their professional responsible for the job isn’t effective.
Another component of the marketing strategy is advertising, where you pay to promote the product you sell. A high percentage of people feel that PR costs a lot of money and they are not sure it is worth it because they never seem to get the results they are seeking. That failure is the result of failure to connect with the right targeted market (known as “reach”) as a result of a poorly planned advertising campaign, Reach without new business and new revenue is immaterial, but lots of advertising agencies talk about how good their reach is all the time. They count ears and eyeballs (yes, that’s a statistic that can be measured, but it is the wrong statistic to place emphasis). The prudent physician advertiser doesn’t give a rip about reach; they care about dollars in the bank.
Advertising should never be expensive
It should be looked at this way: Spend $100, get back at least $101.
With that kind of a result, advertising comes out to be free. The same applies to marketing, and public relations expenses. If you aren’t bringing in more incremental revenue than you are spending per campaign (referred to as “return on marketing investment” (ROMI)) your campaign is not effective. Cut the loss, stop the campaign, redesign the campaign, change the strategy, modify the method, change the targeted consumer persona, change agencies and/or modify or rethink the distribution strategy.
Whatever you do…don’t change the expectation that you should generate at least one dollar over what you spent for the campaign! That’s your constant. Your rock. That’s the formula that measures results you care about. Everything else is marketing and advertising agency jargon designed to get you to agree to buy or place more ads. Sometimes I feel like my clients have been sicked into a Vegas slot machine. Keep feeding the quarters and hoping you’ll hit a jackpot. If you don’t make a dollar extra than you fed the machine, someone else is winning – not you!
Public relations is not marketing per se
Public relations is a component of a marketing strategy. Marketing refers to promoting and packaging your product or service so it sells in the community. Public relations has a specific role in and is used to enhance the success of your concierge medical practice marketing campaign. Its role is to creates the third party credibility that your concierge medical practice needs to increase your return on investment for what you spend on marketing and advertising. It cannot function instead of marketing and advertising. Those who have tried to treat them as interchangeable find that their results suffered the same as if they tried to use a Phillips head screwdriver tip to drive a nail into a board.
Your new reality as a small business marketer and advertiser
Physicians often tend to take the steerage the enjoyed from health plans for granted. Transitioning to any of the numerous concierge medicine business model varieties comes with a few sobering realities about marketing and business. While I prepare my clients for that when I coach them through the transition, I know that many of you may have done the transition on your own or used a consultant that didn’t prepare you adequately for this aspect of the practice. Many take care of the mechanics like canceling the contracts, sending out the announcement letter, helping you with the “town hall” session(s) and setting up your package, deciding on a price, and giving you a template contract. That’s usually where most stop. Some offer “sales training” to whoever you appoint on your staff to handle “membership sales.”
Here’s what you may need to learn that wasn’t necessary back when you were reliant upon managed care plans to steer patients to you:
You may have a great professional reputation among colleagues, the 3500-4500 patients in the community who were steered through the managed care plans in the past, the local hospital administrator(s), vendors, your banker, your accountant, and others. They know you provide quality services, and give back to the community. But when you transition your practice to concierge or direct pay and abandon all the health plans, an unspoken change occurs. Suddenly, 3200-4200 patients have to find a new doctor. Where? The local ACO physicians who are already on overload? The colleagues that must absorb those patients and are already on 3 minute encounters? That’s bound to create some patient acrimony from those being jettisoned who cannot afford to pay your premium membership fee. You may also face an undercurrent of a little unspoken professional jealousy. Neither of those former “brand assets” are going to tell the world how wonderful you are.
If you were a member of the PHO, your hospital administrator now has a “hole in their deliverable to the health plans because the network the health plan contracted for has been disrupted and 3200-4200 patients are in need of reassignment to a new doctor. They could face breach of contract allegations if they cannot substitute your participation easily or quickly. A breach that could cause them to lose the entire contract. So that’s not a potential brand ambassador, is it? With a smaller practice, (300-600 patients) your vendors will see you as a much smaller account than when you were purchasing supplies, equipment etc for 3500-4500. Your banker may delight in your new choice – once you get rolling and have the full panel you targeted because you’ll have more cash – charging a membership plus fee for service, with a smaller staff, smaller suite that means lower rent, and overall lower expenses. Your accountant won’t care much, and your attorney won’t experience much of a change.
So how can you regain the good third party credibility in the community? One way to exalt your brand, the advantages of your amenities package and your services and value proposition is through a successful PR campaign. If the members of the community view you as the physician everyone wants to be associated with, then would they feel you can easily be substituted with another doctor in town that they don’t know anything about? Chances are they would not. But do you do this after you’ve transitioned or before? or at the same time?
No matter what sour grapes you may encounter in the community, you need a tool that will sculpt your brand awareness, reputation and your new product to the general public well in advance of promoting the product or service. Once you announce that town hall meeting (which experience shows is not the most effective way to announce your transition, but the way), the mumbling and grumbling begins for all but those who are ready to write a check. The rest are already running sour grape scripts in their head. Some may even castigate you publicly on social media and ratings sites. That’s to be expected. You may need a tough outer shell to go through that too.
Your competitive field will also change. Now you compete with others who have rolled out their own brand of concierge medicine. But here’s another reality that many doctors were never made aware of – not in school, not by a consultant and not by epiphany – often until it is too late: The concierge physician that has great public relations may not always be as good as the competing physician who doesn’t have good PR, however. Hmmm. Here’s where it hurts the most: Most people, by nature of what they are already familiar with, will choose the physician who has great PR. Why? Because people tend to go by the word-of-mouth referral that a good PR campaign generates for a business. By doing a good job answering phones, callbacks, running on time, practicing good medicine, you’ll feel good. Your new concierge medicine membership patients but without the PR you will be the only ones who know it. Meanwhile, your competitor up the road or down the hall in the same medical office complex who is using a PR professional gets all the air time, media coverage, and brand awareness while you and your great service and good care languish without enough new membership patients to cover the bills.
Here’s another example: A stranger walks up to you on the street and said to you, “Would you buy a concierge medicine membership plan with this physician?” Chances are you would kindly tell them to get lost and keep on walking. But what if someone you know says to you, “Hey you should join this concierge medicine practice. The doctor and his team are great and provide such wonderful service, telehealth, and other services I never got with Dr So-and-so!” Your reaction is going to be much different because it is coming from someone you know is trustworthy and has a great reputation. Even if the other doctors you compete with have a better offer or a cheaper membership fee, people tend to buy the healthcare and become a patient of a physician based on a trusted peer’s recommendation and perhaps pay a slightly higher price for the product because it has an endorsement.
You may also be shy and have a shy staff that is not really adept at “selling” what you offer. A public relations professional helps to create a good reputation for your practice and presents any other aspects of the concierge medicine membership fee in a positive light based on concrete facts. Once you have that external third-party credibility, your marketing and advertising efforts are enhanced and your return on investment to your marketing dollars jumps because it works double time through word of mouth and by referral. Let the PR professional create the demand, and let your staff close the sale and write up the contract and accept payment without being forced into a “sales” role.
Now just so we are on the same page and you don’t think I am building up to sell you public relations services, let’s clear the air. I don’t sell PR services. That is a profession and requires specific skills and moreover, it requires connections to the people that can amplify your brand (media partners, news anchors, magazine editors, etc.) Nor do I have any referral kickback deals with PR Professionals. This article is strictly educational in nature. I do coordinate marketing and coach clients on advertising agency relationships and media buys and oversee the results of recommended ad agency media spends, but I have no revenue stream from any of those services that I do not personally provide. What I will do is help you search for and vet a Public Relations professional who is prepared to help you and who is already familiar with concierge medicine, how it works and the challenges faced by many transitioning concierge physicians. My fiduciary obligation is 100% to my clients. I am not a lead source for PR or Advertising agencies and I don’t accept finder’s fees or commissions.