Botox and other profitable services can help set your organization apart.
Seeking a cash infusion, many hospitals are adding nontraditional services to their offerings—from facials to full-body imaging scans—to improve patient satisfaction, generate positive word-of-mouth, differentiate themselves from the competition, and build downstream revenue.
Two St. Petersburg, FL, hospitals, for example, Bayfront Medical Center and Carillon Outpatient Center, recently added retail services. Carillon's medical spa offers laser therapy, microdermabrasion, Botox, massage, and facials. Bayfront's "aesthetic medical practice" offers Botox, Restylane, laser hair removal, and other services performed by a physician.
"Some smart health systems that are in a hyper-competitive marketplace are realizing that customers have experiences at their site," says marketing consultant Michael Harris, CEO, Michael Harris Group, Inc., in Phoenix. Those experiences can make the difference between a patient who returns to your hospital and one who doesn't.
"You can't afford to thwart that customer and push them off into a competitor's arms," Harris says.
Another benefit to these new offerings: Profits are much better when patients pay out-of-pocket. Healthcare market strategists weren't paying attention to these services "until they figured out that it was good for their bottom line," Harris says.
Ancillary services can provide a cash infusion, agrees Joshua M. Kaye, a partner with McDermott Will & Emery, LLP, in Miami. Kaye advises healthcare organizations on outpatient market strategies.
"A number of hospitals and health systems are willing to offer a much broader range of outpatient services now than ever before," he says. "By partnering with the physicians, they can continue to receive a part of the outpatient revenue stream that may otherwise have entirely transitioned outside of the hospital into a physician-owned venture."
Five steps to launching and marketing new services
Not every service is the right fit for every organization, however. Choosing the wrong one can be a disaster. Harris offers the following five-step launch process:
Often, add-on services are part of a long-term market strategy. A wellness program, nutritional counseling, even services that provide healthy meals to patients help build long-term relationships with consumers and can lead to diagnoses and treatment of other illnesses and conditions, such as diabetes or high blood pressure. "It's a feeder service line that's just a tremendous source of revenue," Harris says.
Other profitable services that are growing in popularity include ambulatory surgical centers, cardiac cath labs, medical imaging, radiation therapy, and other oncology services, says Kaye. Although they require an investment in facilities and equipment, they're most likely to provide the best return.
In addition to ASCs, which can cost a fair amount to build and equip, adds Jerry Sokol, a partner with McDermott Will & Emery, some outpatient services—like nuclear stress testing—require less expensive equipment and don't need as much space. Such services can produce a high ROI quickly.
Want to boost revenue, improve patient satisfaction, and differentiate your organization from the competition? Michael Harris says you should consider adding the following products and services to your portfolio: