Marketing directly to consumers during open enrollment periods is nothing new for insurers and HMOs, but now hospitals and medical groups are getting into the act.
Last fall some providers targeted employees, trying to convey the added value of choosing a plan in which they are a preferred provider. In some markets, healthcare ads crowded billboards, airwaves and the mail.
This recognition of consumers-rather than employers-as the ultimate purchasers of care should continue as more providers become capitated, and their revenues linked to numbers of covered lives.
However, consumers still lack enough helpful information and patience to sort through it all, and open enrollment campaigns risk having their messages blend together, adding to consumer confusion.
"Most people spend more time picking a restaurant for dinner than they do picking a health plan. It's really quite alarming," said Bill McKeon, director of marketing at Stanford University Medical Center, Palo Alto, Calif.
Saturation is the potential weakness of advertising exclusively during open enrollment, McKeon said. By his estimate, 85% to 90% of providers in the San Francisco area advertised during open enrollment in 1994, while almost none did three years ago.
For that reason, Stanford chose a long-term approach, starting its campaign months before.
Early promotions emphasized Stanford's specialty and tertiary care, and included an education campaign on strokes. The offensive later broadened to a $200,000 campaign for its growing primary-care base.
Stanford's Menlo Clinic in Menlo Park, Calif., held an open house in the fall, said Joan Hankin, director of the Stanford referral center. She said more than 500 people stopped to get a flu shot and a snack, meet staff physicians and tour the facility.
"Three ads in a blitz isn't going to affect the (consumer) decision," McKeon said, explaining the long-term approach. Besides, "It's not in the best interest of prospective members."
Stanford and its competitors told consumers that when they choose a plan, they also limit their future choices of providers. Calls to Stanford's primary-care referral line revealed "a tremendous amount of confusion" about selecting a plan, McKeon said.
"People assume that having a great medical center in their back yard, they have access to it," he said.
David Marlowe, vice president for strategic services at Market Strategies in Columbia, Md., said consumers often aren't sophisticated in their approach. "Some employees pick their plans based on whether they can understand the manual," he said.
Consumers are becoming more savvy, but they still ask simple questions, said Jim Eppel, vice president for commercial products at Allina Health System in Minneapolis.
Last fall Allina invited customers to ask questions, and the number of calls to the integrated health system's customer service lines climbed to 40,000 in October, from a monthly average of 25,000.
Instead of questioning outcomes, quality and performance, Eppel said, consumers asked for help determining premiums and locating their own physician in the network.
Allina spent $215,000 marketing its health plans to employers and employees last fall, although few providers in the Twin Cities have taken up special marketing for open enrollment. Allina's expenditures were "beefed up somewhat" from the rest of the year, Eppel said.
New American Health, a new physician-hospital organization of North Arundel Hospital in Glen Burnie, Md., targeted a narrow geographical market with ads in a local section of the Baltimore Sun, costing $20,000. Radio ads ran in the broader Baltimore market and cost $10,000. In addition, printed handouts ran $30,000, $14,000 of which applied to year-round marketing expenditures.
The open-enrollment campaign aimed to emphasize the PHO's wellness and educational offerings, and the size of its primary-care network. It also attempted to increase name recognition, said Morris Reitz, director of marketing.
Providers should heed market research and determine what local consumers want, Marlowe said. For example, a dual-career white-collar family might pick a plan if its facilities are open after work and on weekends.
The challenge in the glut of messages is to differentiate yourself, said Arthur Sturm, president and chief executive officer of Sturm Rosenberg Cafferata, a Chicago-based healthcare marketing and advertising firm.
He listed price, network distribution and patient satisfaction, in that order, as the top influences on consumer choice.
Employers are listening to their workers' preferences more than they did in the past, Sturm said. And with capitation growing, hospitals have to follow through to boost enrollment after signing a managed-care contract.
"If you don't get people to sign up, the contract doesn't really mean anything," Sturm said.