Nonprofit hospitals can profit from today’s marketplace
Hospitals are in the midst of a slow motion pivot in their business model. The movement is glacial, but it’s there.
Still rooted in a fee-for-service reimbursement model that emphasizes quantity, hospitals are now under pressure to move toward a qualitative model driven by outcomes. (And better branding, but we’ll get to that in a moment.)
This dynamic of slow change – catalyzed by the irrepressible movement of consumerism and branding in healthcare – is opening a door through which nonprofit hospitals can take a step forward. And, in doing so, step up to a more competitive footing in the marketplace.
Defining the brand difference in hospitals.
There are several differences among for-profit and nonprofit hospitals. And ready or not, consumers should understand them.
It’s worth noting that despite the tax advantages made possible by a hospital’s nonprofit status, they are often more profitable than their for-profit counterparts.
Yet healthcare consumers relate differently to nonprofit entities compared to for-profit ones because all people have a unique set of ideas regarding nonprofits that nonprofit hospitals should recognize – and leverage.
In the name of medicine, not money.
Historically, nonprofit entities are understood to be caring, enriching, enabling, responsive, and responsible, among other attributes. Many nonprofit hospitals have grown from religious roots. Others have longstanding charitable missions in the community. But the opportunity they all have is to translate their identity into successful brand work.
This means reinventing “nonprofit” into something of value that a healthcare consumer can share. It means combining medicine and mission in terms people can understand. The beating heart of “nonprofit” hospital brand is centered on quality over quantity, which is where healthcare is heading anyway.
Depth vs Width.
So, while for-profit hospitals often spend more on marketing, nonprofit hospitals can focus on qualitative excellence and deeper branding, not wider. While many consumers lose trust in healthcare, nonprofits can restore it.
Managing brand quality is something we at drinkcaffeine do for nonprofit hospital clients in specialty care as well as critical access care, and for community-based primary care agencies. We also serve Humana, the Center for Hospice Care, and other players in the field.
If it sounds like an interesting conversation, we should schedule a beverage.