060224-crm strategies in healthcare

8/2/2019 060224-CRM Strategies in HealthCare

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Adapting CRM Strategies for the

Healthcare Market

Thomas Corry

Managing MemberCorry Direct Marketing, LLC

[email protected]


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Healthcare CRM

What in the world does healthcare CRMhave anything to do with my business

and why am I here?


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Healthcare Marketingis Changing

Hospitals are moving from mass

advertising to targeted direct marketing. Hospitals are very competitive. Look at

the New York City metro area

marketplace. How do you make sure prospective

patients come to your facility?


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Healthcare Marketingis Changing

Doctors used to be the target of marketing but

has changed to direct to consumer. Hospitals are developing customer outreach

databases and are using traditional directmarketing techniques.

Different offers, creative and techniques areused in direct mail to attract prospects to thefacility.


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Healthcare has many of thesame goals as other consumermarketing companies

Hospitals are no different than consumerdriven companies such as BMG, Time, Inc.,Boardroom, Pfizer, or Chase, etc.

The business acronyms may be different butthe goals are the same.


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Healthcare marketing isconsumer marketing

Patient acquisition: How do I get morepatients coming to my facilities?

Patient retention: How do I get my patientscontinuing to use my facilities?

Patient winback: How do I bring back

patients who havent using my facilities forsome period of time?

New Movers: How do I attract prospectivepatients in my facilitys footprint?


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Three Components to a

Successful Initiative

Filling the Funnel

Marketing Targeting - OfferList Execution Appointment setting Marketing

Margins & Referral PatternsPCP PCR

Op Margin - SplittersOut migration factors

Facility

Management

Managed care

OperationsNet Appointments Slots Throughput

Follow Up - Reporting

Facility ops


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Marketing Value Chain

Compellingvalue

proposition

Cost /benefit

Relevant

Timely

Determinecommunications

channels

Efficient

Appropriatetarget

demographic

Work backtime lines

Advertisingproduction

Stafftraining

Eventcoordination

Creative

Compellingoffer

Attentiongetting

Clear call toaction

Ampledates and

timesoffered

Responseprojections

Non-holiday

Morningslots

Weekends

Operationsplanning Project owner

Call Centercoordination

Ease ofappointments

Site

planning Trackingplan

Validate pro forma

Volume projections

BE analysis

ROI

Key Learnings from Prior Campaign


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Healthcare CRM

Tenet Healthcares south Florida divisionanalyzed their $60 million in marketingspending and realized they could cut over75% of that cost.

Their spending was for billboards, radio,newspaper and other mass advertising.


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Healthcare CRM

Tenet Healthcare tested direct response anddatabase marketing to 3 hospitals in 2000.

Based on the tremendous results the programwas rolled out to 25 additional hospitals in 2001.

An additional 20 hospitals were added in 2002. Two goals from direct marketing:

1. Increase profitability from existing patients

2. Drive prospects to Tenet hospitals.


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Database Architecture

BillingData

CallCenter

Health RiskAssessment /

PersonallyCollected Data

3rd PartyGeodemographic

Overlay Other DataSourcesEncounterData

MarketingDatabaseSegmentation System

Segmentation Scoring

Access & Reporting Tools

Consumers

Direct Mail

Internal Data External Data

PositiveConsumer Response

Call Center

Faci l i ty Screeninglinical Servicesi l l ing Data

Data Hygiene


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Tenet CRMTesting Results

Database marketing is profitable for hospitals

Profitability varies by payor mix and

competitive environment Product lessons:

Cardiology most profitable

Some product lines work, some dont e.g. sleep disorders, sports medicine

Expect eight-week time lag before start ofrevenue stream

Revenue has continued to actualize


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Segmentation andScoring Models

Healthcare life-stage (off-the-shelf)

Modified healthcare life-stage Disease specific models

Predictive models

Other models (RFM, loyalty scoring,etc.)

Neural Net using hundreds of variables


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SolucientSolucientuses cluster methodology,along with other data elements.

CPM Corp. uses neural net technologyto score names by house and prospectand by service line, e.g. cardiology,pulmonary


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CPM Corp. uses two different scoring

approaches. Consumer HealthcareUtilization Index (CHUI) and PatientDisease Index (PDI).


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CHUI scores run from 0 999 to

identify an individuals propensity to usehealth care services as defined by themajor diagnostic categories (MDC) andspecific diseases within the ICD-9 anddiagnostic related groups (DRG). Thehigher the number, the greater thelikelihood the individual will need the

service. This is used for prospects.


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The Patient Disease Index (PDI) is aco-morbidity segmentation system thatuses patient data for segmentation.

In other words, if someone haspulmonary issues there is a likelihoodthere are cardiology issues.


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Revenue Chain

Recipient receivesoffer May go directly

to physician for evaluation ofsymptoms, etc.

Related clinical servicedelivered at hospital

Bypass screening

Product line-specific revenue from a person that was on the original mailinglist that did or did not respond to the offer and might have been screened.

Delivered service and revenue trackedthrough facility billing system

Results andtest plan analysis

pro forma validated


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Control Group Methodology

21,988 mail quantity of campaign prospects pulled fromdatabase

1,161 (5% of total prospect quantity) held back (did notreceive mailing) for control group testing

$82.47 average profit perprospect individual mailed

$15.75 average profit percontrol group individual

$66.72net profit per individual mailed

$66.72 x 21,988 = $1,467,039 adjusted net marketingprofit


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1 Gross charges X PCR = Net Revenue*patient to charge ratio

Product Line (if available)

2 Net Revenue X Net Operating Profit % = EBITA

3 EBITA - Marketing Costs** = Marketing Profit

*Net Revenue is projected based on PCR** Marketing costs include: All creative costs, agency fees, letter shop costs,paper, printing and postage.

ROI Calculation


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Revenue Tracking

Billing System/Code Based

Conducted monthly

Tracks to a specific set of ICD9 and DRG

codes (reviewed by Medical Affairs and PatientFinancial Services)

Data tracked for 12-month period

In direct marketing, matches a mailed-to

individual against the codes In direct marketing, control group revenue isalso tracked against a mailed-to group

Vi t l C l


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Virtual ColonoscopyVital Statistics

(Source: Call Center Reported Data)

Marketing costs: $181,162

(Includes: Radio, creative, production, planning)Responses: 1058 completed calls

Appointments set: 179

Net screens:(if known) 54

Screens needed to B/E: 798

H it l A


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Hospital AVital Statistics


Quantity mailed: 21,985

Responses: 323Appointments set: 346

Net screens: (if known) 307

Visits/discharges: 54

Gross revenue: $574,266Net revenue: $189,508

EBITA : $36,006

Marketing profit/loss: $19,839(EBITA Marketing Costs)

H it l B


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Hospital BVital Statistics


Quantity mailed: 40,000

Responses: 403Appointments set: 286

Net screens: (if known) 200

Visits/discharges: 165*(incl. medical records)

Gross revenue: $75,273Net revenue: $13,620

EBITA: $2,302

Marketing profit/loss: ($22,657)(EBITA Marketing Costs)


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Creative and Offers


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Creative and Offers

060224-crm strategies in healthcare

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