image and cost factors in the choice of mental health-care organizations: a causal model

Image and Cost Factors in the Choice of Mental Health-Care Organizations: A Causal Model

Raj Arora Bradley University

and

S. Tamer Cavusgil Bradley University

BACKGROUND

How important are image and cost factors in the choice of a community mental health center'? Which components of a center's image are important to potential users'? How effectively can a causal model capture the relationship between the perception of a health center and preferences towards that center'? What points should be emphasized in a communications program of a health center'?

The present study was designed to address these, and related questions in an effort to appropriately position a community mental health center (CMHC). The study represents an extension of the image research to the mental health-care area, and it illustrates that image can be a significant determinant of preferences towards alternative sources of mental health care. The article is organized as follows: first, a review of previous research is offered, followed by a discussion of the importance of measuring image of mental health-care institutions; next, the methodology and results are presented, followed by discussion and conclusions.

PREVIOUS RESEARCH

Measurement of store/company image is now an established field of inquiry in marketing. Studies abound demonstrating the usefulness of in-

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120 IMAGE AND COST FACTORS IN THE CHOICE OF MENTAL HEALTH-CARE ORGANIZATIONS: A CAUSAL MODEL

stitutional image research in the marketing process. (McDougall and_ Fry 1974-75; Nevin and Houston 1980). Applications of image assessment in the area of health-care marketing have been scant. Several authors did stress the need for applying modem marketing concepts and procedures to the health care area (see, for example, MacStravic 198 I; Tucker 1981; Wallace and Venkatesan 1981; Kotler 1979; and Berkowitz and Flexner 1980-81). However, empirical research, especially in the area of mental health care, has been limited.

A stream of writing has dealt with awareness of and attitudes towards mental health centers. An early study by Heinemann, Perlmutter and Yudin (1974) dealt with community awareness of a CMHC and its satellite branches in the Philadelphia area. Their findings revealed that only 15 percent of the respondents were aware of the existence of the CMHC, and many were ill-informed about its services. Unfortunately, the study was not designed to test the effectiveness of a previous promotional campaign, and the authors failed to elaborate on what particular features of a CMHC or its services should be highlighted in a communications program designed to improve awareness.

A similar study by McWilliams and Morris (1974) surveyed residents' attitudes toward a new CMHC in the Tucson area. In another study, Mor- rison and Libow (1977) measured the impact of newspaper publicity on the level of awareness of a CMHC in Albany. Finally, Lebow (1982) elaborated on the need to evaluate mental health treatment and proposed four different approaches. These included: the care-process model, the efficacy model, the community-impact model, and the consumer evaluation model. The last model seems to support the contention that input obtained from existing and potential consumers is important in assessing the performance of such centers.

THE IMPORTANCE OF MEASURING IMAGE

Community mental health centers are subject to a number of pressures that affect the way these centers will operate in the years ahead. These developments include: a reduction in federal appropriations; the use of block grants to the states; increasing efforts at deregulation; continuing effect of deinstitutionalization; and the increasing number of alternative institutions where consumers can obtain similar services (Beigel 1982). To cope with the changing environment, the nation's almost 800 federally assisted CMHCs will have to develop appropriate strategies designed to deal with the challenges. An important first step in this direction would be to better

ARORA AND CAVUSGIL 121

understand consumers' choice processes relating to a CMHC, and the rel- ative importance played by the image of a center (and the costs of obtaining the services) in this choice process.

The importance of measuring and managing image for health care institutions has been pointed out by several authors (Tucker 1981; Cavusgil and Reitinger 1983), but has not been applied to community mental-health centers. Accordingly, the present study was designed to empirically assess the components of image for a CMHC, and to demonstrate how image and cost affect preferences towards a CMHC. The relationships among the variables were tested using a causal model.

METHOD

The respondents were adult residents of a medium-sized metropolitan area in central Illinois and belonged to a household panel with a total membership of 800 households. The panel composition was very similar to the census data for the region in terms of education, income, race and marital status. This panel had been successfully employed in previous investigations.

The data collection portion of the study proceeded in two phases. The first phase consisted of telephone surveys of the panel of 800 households. These calls generated 489 completed responses. The purpose of the initial telephone survey was to identify those respondents who were sufficiently familiar with the CMHC. Those respondents who lacked sufficient famil- iarity with the CMHC were left out of the second phase since a necessary condition to assessing the image of an organization is awareness of the organization. The data for the second phase were collected through a mail survey of 204 eligible respondents. Semantic differential scales were used to determine the extent to which the respondents believed that the organization possessed the stated attribute. The relevant attributes were selected from a review of literature and consultations with representatives of the service organization (Justice and McBee 1978; Mongen and Griffith 1982; Tanner 1982; and Holden and Lewine 1982). The mail survey of eligible respondents resulted in a 61 percent response rate, generating 124 usable responses.

RESULTS

The data on attributes of the CMHC were analyzed using exploratory factor analysis. This analysis revealed two distinct dimensions - - image variables, and cost variables. These two constructs, along with the associ-

122 IMAGE AND COST FACTORS IN THE CHOICE OF MENTAl. HEALTH-CARE ORGANIZATIONS: A CAUSAL MODEL

ated statements (yl - y9) are presented in Table 1. The reliabilities of the two constructs, using Cronbach's Alpha procedure, were 0.85 for image and 0.88 for cost construct. Compared to the widely used range of accept- able reliabilities, both figures suggest high reliability.

Table 1 also identifies the dependent variable used in the causal model, Eta -3, the preference construct. Composed of three separate statements, this construct relates to respondents' rank-ordered preferences of alternative mental health-care organizations. This choice of the dependent variable deserves some explanation. The attitudinal literature utilizes intentions (stated in various forms) to act, purchase or utilize the services (Fishbein and Ajzen 1975). On the other hand, McFadden (1973) has shown that choice preferences are reliable indicators of intention towards an act or purchase. Considering the "sensitivity" of obtaining assistance for psycho- logical problems, we felt that preferences in referring some one to a specific organization would be a more appropriate variable to use in this study.

The proposed relationships between preference (Eta -3) and its determi- nants, image (Eta -1) and cost (Eta -2), are depicted in Figure 1. These relationships were tested using Linear Structural Relations Analysis (LIS- REL) approach (Bagozzi 1980; Joreskog and Sorbom 1978). The use of LISREL over other methods of analysis offers an advantage in that it recognizes that observed variables are not perfect measures of unobserved underlying constructs. LISREL: (l) explicitly recognizes the errors in variables (and in equations), and (2) permits the testing of relationship between unobserved independent factors (image and cost) and dependent factor (preferences).

An initial analysis of the proposed model in Figure 1 resulted in a Chi- Square value of 209.33 with 55 degrees of freedom, which indicated that the data do not conform to the specified model. The first order derivatives revealed the presence of correlated errors. Consistent with the procedure recommended by Joreskog and Sorbom (1979), the coefficients of certain correlated errors were relaxed to free parameters. The Chi-Square value for the revised model was 51.73 with 45 degrees of freedom and a p value of .23 indicating that the model conforms to the data. These estimates are shown in Table 2. They are also superimposed on the original model in Figure 1.

DISCUSSION

The path coefficients (lambdas) shown in Figure 1 are analagous to factor loadings. The relatively high values of the path coefficients (compared to


TABLE 1

CONSTRUCT RELIABILITY AND VARIABLE IDENTIFICATION STATEMENTS

Reliability Variable Statement Construct (Alpha)

T/1

Image Construct

Cost Construct

03 Preference Construct

85

8 8

80

Y~

Y2

Y3

Y4

Y5

Y6

Y7

Y9 l Ylo

Yll

Y12

Reputation in community regarding treatment of drug/alcohol and social/emotional problems

Availability of emergency services

Friendhness of staff

Competence (ability) of staff with social and emotional problems

Competence (ability) of staff with drugs and alcohol problems

Delay in getting an appointment (reverse coded)

Certification of staff (unit) by state

Pnce for social or emotional counseling services

Price for drug or alcohol abuse rehabilitation services

Ranking of preferences towards the service organizations regarding drug and alcohol related problems.

Ranked preferences towards the organizations regarding social and emotional problems

Ranked preferences towards the organizations regarding problems pertaining to emergency services such as threatened homicide, family disputes or overdose


TABLE 2

MAXIMUM LIKELIHOOD ESTIMATES OF FINAL MODEL

Parameter Coefficient T-Value Parameter Coefficient T-Value

A 1

A 2

k 3 h 4 ,ks ,k s

,k s

,k9 hlO ,kll

,k12

1.0" 53 7 31 ~1 .03 50 699 ~2 71 82 1062 ~3 .74 81 11.11 ~ .26 50 7.27 {5 .32 56 6.49 ~6 76

~7 68 ~8 .00"

10" % .39 91 15.95 ~1o 00"

1.0" .65 11.05 .55 858

B 1 55 6.77 B 2 -02 -20

x2/df P value

5173/45 23

0.04 824 834 370 5 05 8.37 732

807

~4~ -.38 -593 %~ -31 -5.89 %1 -.20 -3.48 %1 -11 -297 e4z -.15 -250 ~1o= -.20 -4.10 %~ .14 255

~os -. 17 -3.29 ,ess -18 -246 es9 10 333 %9 -31 -396 %09 .14 3.74 ~21~ ,16 280

"Constrained parameter,


l l J

"5

6

to

"6

i

.o


the standard errors) imply that all three constructs are measured quite well by the corresponding variables. The coefficient Beta -1, reflecting the causal effect of the image construct on preferences, has a value of .55 and is significant (standard error = .08). The coefficient Beta -2, indicating the effect of cost on preferences, has a negative sign, and is not significant.

One explanation that can be offered for the insignificance of cost construct as a determinant of preferences may be that, in the health-care area, the primary concern of the individual is in getting well, and therefore cost of the service is not critical. This is supported by the contention offered by Gully and Harris (1982) that a fee relationship has to be established between the supplier and the user of mental health services, primarily for the purpose of maintaining "involvement, motivation, and belief in the efficacy of psychotherapy" (p. 211). Several other studies also downplayed the role of costs in the choice of mental health services (Allen t971; Balch, Ireland and Lewis 1977; Paris 1976). Our f inding appea r s to suppor t this conclusion.

Still another explanation for the insignificance of cost construct may be that the total cost of visits is not borne by the patient (family). A pertinent fact is that the cost of an office visit varied from a low of $5 per hour to a high of $55 per hour. This variation in charges is based on an individual's ability to pay, which is determined from household income and the number of individuals within the household. This implicit price discrimination may downplay the importance of price.

An implication of the findings is that mental health-care administrators should focus on salient variables so that their organization is perceived to be more favorable than those of competitors in the area. The importance of variables, which are salient in the image construct, can be found from the values of the coefficients Lambda -1 to Lambda -7 and their associated t - values.

These values indicate that all the variables Y I through Y7 are significant. Within these, the most important variable is Y l: Reputation in the community. This is followed by variables Y4 and Y5 which reflect the competence of staff in the social/emotional and drugs/alcohol related areas. The rest of the variables are about equal in importance to each other. Thus the variables which appear to have the greatest impact are reputation in community and competence of staff. Naturally, a communications program which explicitly focuses on these variables would be highly desirable.

An important decision concerning the communications program is the choice of the relevant target market. Should the focus of communications be on the individuals (their families), or on other gatekeepers (physicians,


priests, ministers, etc.)? Traditionally, the health-care literature appeared to emphasize the role of gatekeepers. Current evidence appears to offer support for the role of individuals as decision makers. A study reported by Berkowitz and Flexner (1980-81) showed that individuals exercised significant influence in the choice of a hospital, in approximately 49 percent of the cases. In the current study, consultations with the staff of the CMHC indicated that the percentage of individuals making their own choice decision is as high as 60 percent. Thus, a marketing strategy aimed directly at individuals who need the services (in addition to communications directed at gatekeepers) appears to be an appropriate strategy.

CONCLUSION

This study started with the proposition that the image factor is a significant determinant of preferences towards a mental health institution. In the absence of any other empirical study which focused on the role of image in the choice of mental health centers, it was deemed desirable to focus on image as a significant determinant.

Although the findings of this research support the causal model, which shows choice preferences being "caused" by the image of the organization, some caveats need to be stressed. Although all measurements were taken at one time, the test of the model formulated in the current research is consistent with a causal modeling approach. Its acceptance suggests that image has a causal effect on preferences (Arora 1982). However, a causal relationship would be most conclusively demonstrated by an experimental design or a longitudinal study. Another factor that needs mentioning is the presence of correlated errors (Epsilons -41, 51, 71, etc.). Although small in magnitude compared to the Lambda's and Beta's, these errors indicate the presence of some unmeasured contaminators, faulty or common measures.

To conclude, the findings of the current study are helpful, as they demonstrate that image variables do have a significant impact on choice preferences for mental health institutions - - just as in the case of banks, department stores, hospitals or other service providers. Costs however, were not a major determining factor. Since this represents the first application of image assessment to mental health institutions, future studies are warranted to extend the findings even further, and to assist in the strategic positioning of these organizations in today's changing environment.


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ABOUT THE AUTHORS

RAJ ARORA is a Professor of Marketing at Bradley University. He received B.S. and M.S. degrees in Industrial and Systems Engineering from Uni- versity of Southern California and M.B.A. and Ph.D. from Claremont Graduate School. He has published in Journal of Academy of Marketing Science, Journal of Advertising Research, Journal of Marketing Research, Journal of Small Business Management, and in the proceedings of several national and regional professional associations.

S. TAMER CAVUSGIL is Professor of Marketing and Director, Center for Business and Economic Research at Bradley University. Previously, Dr. Cavusgil taught marketing and international business at the Middle East Technical University in Turkey and at the University of Wisconsin. Cavusgil is the author and coauthor of four books in marketing and international business, and over fifty articles in books and professional journals includ- ing: Journal of Marketing Research, Business Horizons, European Journal of Marketing, European Research, Journal of Business Research, Journal of the Academy of Marketing Science, Journal of International Business Studies, Journal of Management Studies, Long Range Planning, Der Mar- ket, Food Policy, and others. He serves as a consultant to a number of industrial and consumer goods companies, hospitals and other organizations. Cavusgii is currently the Editor of International Marketing Review, published by the Corporate Press, and the Editor of the JA1 Press Annuals, Advances in International Marketing. He is also on the editorial review boards of Journal of Marketing, Journal of Business Research, Journal of International Marketing and Marketing Research and other professional journals.

image and cost factors in the choice of mental health-care organizations: a causal model

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