How to Map Your True Hospital Marketing Area
Do you know your hospital marketing area?
This answer is a foundational element for any strategic healthcare marketing plan. The scope and shape of your marketing area determines what marketing strategies and tactics make sense when trying to increase hospital’s patient volume.
You need to build hospital marketing area maps.
One of the ‘rules’ about marketing is that it’s usually more cost effective to increase frequency among existing customers than it is to attract entirely new ones. Although pure consumer selection does drive volume for some services, physician recommendations drive a greater share of volume for non-emergency inpatient admissions and outpatient procedures. (For today’s purpose, we will focus on ‘decision simplicity,’ physicians as customers and referral patterns, and tackle how to leverage pure consumer preference in another article).
The purpose of creating maps is to create a common, objective understanding of your primary and secondary marketing area. The size and shape will be determined by the distribution of your physician network, economic circumstances in different areas, competitor locations and expertise, traffic flow barriers and travel time.
After all, most healthcare is local. By understanding the size and shape of your marketing area, you can evaluate marketing and business development tactics with an eye toward impacting physicians and consumers.
Additionally, hospital marketing area maps are a great visual tool to use when explaining your marketing strategy and tactics to administration and medical leadership.
The first step is to work with your finance, strategic planning or business development departments to pull the information needed to generate your maps. Include 12 months of admissions/procedures to allow for seasonality and service lines that have a long lead time. Keep in mind these data pulls can take a while to fulfill, so submit your requests early in the strategic marketing process while developing messaging and proof points on a parallel path.
Slices to Consider in Your Hospital Marketing Area Map
1. All Patient Home Addresses/All Services
When working with patient information, HIPAA compliance is essential. The goal of patient origin mapping is to visualize patterns while preserving the anonymity of each ‘dot.’ (See tips at end.) The areas with the highest density of dots represent your primary hospital marketing area. Your marketing investment would extend beyond this core area when:
- You are opening new satellite facilities near the edges or outside of your primary area.
- Your competition has experienced substantial negative change in reputation, medical leadership or scope of services.
- Your media options are scalable and are more cost-efficient than geographically targeted tactics.
- You need to make a high-impact statement to raise top-line awareness, improve your hospital’s reputation, re-launch a brand, or attract and retain highly covered clinical leaders.
- You are marketing a specialized service line where there’s greater willingness to travel.
2. Patient Home Addresses by Key Service Line
The more significant a diagnosis or procedure, the more likely it is the specialist will express a preference about where it would it should be performed, and the more likely a consumer will travel further for it. This is usually the secondary service area captured on your map. The dot density will be less, but the commercial or Medicare reimbursement may be very attractive.
To visualize your secondary service area by service line, you will need to define the CPT (Current Procedural Terminology) codes to include in the request you provide to finance or strategic planning. CPT codes are standardized and used in billing/claims processing to indicate the services rendered. The key is determining which CPT codes to include or exclude to get an accurate picture of just that service line’s market area for higher margin procedures. For example, in the case of an orthopedic service line, you may wish to exclude related services like physical therapy or lab tests and focus more narrowly on knee replacement surgical patients. You can get a 14-day free trail of a tool to identify CPT codes from the AAPC to help.
Michael Crawford became interested in healthcare listening to the conversations around the patio table as his parents and their colleagues talked about work. For the past 30 years he's used his marketing expertise to help medical groups, hospitals and health systems connect with consumers, physicians, employers, brokers and health plans. He advocates for a strategic approach to marketing, audience-based communications, coordination between marketing and customer service functions, and early inclusion of the marketing discipline when planning services. His work has earned more than a dozen awards over the past few years. He’s no stranger to healthcare reorganizations or healthcare reform, from the failed effort during the 90s to the implementation of the ACA to today’s efforts at repeal. His blog, Healthcare Marketing Survival Guide, offers advice for B2C and B2B healthcare marketers trying to chart their course during uncertain times. Connect with him via LinkedIn or follow him on Twitter @health_crawford.