Tuesday, July 13, 2010

Driving patient volumes and revenue via RN-based physician referral call center

Okay it is quiz time.

What is the fastest way to build brand awareness, drive patient volumes and revenues, reconnect with patients that haven't used your hospital in several years, build your physician practices and can be analyzed in financial terms to prove Return on Marketing Investment (ROMI)?

Hint- the answer is in the title.

That's right, physician referral brand building marketing activities via an RN-based call center.

Here's the premise and it's something that I have used successfully over the years to drive volume and revenue for all products lines. At the end-of-the-day, nothing happens in any way, shape or form in your healthcare organization without a physicians order. In the case of an ER utilization, the docs there already will be your surrogate for admissions, tests and follow-ups and for referral to physicians in the event an ER patient does not have one.

It is a classic push pull strategy.

Push the patients to your physicians, pull the physicians to your organization.

Inherent in the concept and activity is the process improvement you are undertaking internally to make your healthcare organization the easiest place in the known world for physicians to practice medicine.

For you see, with all the brand building marketing activity that goes on for a hospital or multi-hospital system, changes in market share are due more to physician admitting behavior than anything else. In longitudinal market research studies that I have participated in over too many years to tell, when you look at changes in the marketplace over time, competing hospitals market share only changes usually by one or two percentage points annually.

Sometimes the gain or loss is only for six months. It's the same one or two points among all competing facilities. Meaning that physicians are moving patients between competing hospitals. Patients don't move themselves, the physicians are. When all things are equal, the physician will tend to move to the hospital that makes it easier (i.e., efficient and effective) to practice medicine.

Also with your physician referral marketing, you need to run all community activities, wellness programs and events registration, speaker bureau opportunities and product-lines through your physician referral as well. It's all about capturing a patient name and getting them to your docs.

What follows now is an actual Return on Marketing Investment analysis that the CFO and members of the Finance department were involved in looking at an RN-based call center- physician referral, speakers bureau and event registration.

The method can be adapted to any campaign and provides you with the data fields and logical analysis you need. This has been heavily edited to hide the organization. The full report was quite large and contained an entire programmatic evaluation of the Physician Referral Call Center with recommendations for improvement to increase scope and capabilities. This portion is most applicable for today’s conversation.


An analysis was undertaken to look at the ROI of the Physician Referral Call Center. The analysis matched a database of call center name records for the period to financial records which had already been downloaded. The analysis produced the following results:

9,102 call records were matched with utilization and financial data.
9,102 calls resulted in a total of 9,121 encounters in the ER, Inpatient and Outpatient categories of service.

751 encounters were ER
177 returning encounters
573 first time encounters

1,105 encounters were Inpatient
530 returning encounters
699 first time encounters

7,267 were Outpatient
2,014 returning encounters
5,253 first time encounters

Total charges for all encounters equaled $22,522,649

Charges for new encounters all services totaled $16,085,198 or 71 percent of the total charges

Average charge per ER encounter $1,304

Average charge per Inpatient encounter $13,581

Average charge per Outpatient encounter $903

Gallup measures loyalty at 68 percent (would return for service) which means that for every 100 patients 32 would not return for care- therefore:
ED- 57 returning encounters captured that would not have returned
Inpatient – 170 returning encounters captured that would not have returned
Outpatient- 645 returning encounters captured that would not have returned

Incremental charges counted returning encounters not loyal
ER - $74,337
Inpatient- $2,308,851
Outpatient- $582,505
Subtotal charges counted: $2,965,693

Overall market share in primary and secondary service area is 14.53 percent. The number of first time encounters have utilized us above market presence is therefore:
ER 573 first time encounters, 83 not countered, 490 counted –
Inpatient – 699 first time encounters, 101 not counted, 598 counted
Outpatient – 5,253 first time encounters, 763 encounters not counted, 4,490 counted

Based on an overall market share of 14.5 percent the incremental charges counted for new encounters not because of market presence:
ER - $638,960
Inpatient – $8,121,438
Outpatient – $4,054,470
Total Charges counted: $12,814,868

Discount from gross charges for Medicare, Medicaid, Managed Care, Bad Debt and Charity Care @ 65% is $8,326,644

Net Revenue: $4,488,224

PRCC program costs: $233,410

Net contribution: $4,254,814
ROI 18.22:1

This is the one way that you can have an immediate and lasting impact in driving patient volumes and revenues. This is all about creating internal value and accountability. Here is value. Here is accountability.

Physician referral activities pay off in a big way.

I can be reached at 815-293-1471.

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