Healthcare Marketing: Growth in Outpatient Procedures Isn’t the Whole Story for Marketers

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Hospitals are seeing growth in outpatient procedures. That’s not the whole story for marketers. While the volume of outpatient revenue may be increasing, your hospital may be losing market share.

Hospitals are depending more heavily on their growth of outpatient service. Revenue from outpatient procedure has been steadily increasing. All is well, right? Not necessarily. While your hospital may be experiencing strong outpatient growth, the real story may be market share.

Because the increase in demand and occurrence of outpatient services has become so strong and may appear your hospital is doing great, it may actually be losing share. The pie is growing and so every piece is larger, but that does not mean every piece is proportionally larger relative to the other pieces.

A recent study by Thomson Reuters found that “while hospitals are seeing their outpatient volumes increase, numerous hospitals are actually seeing their market share drop due to dramatic growth of freestanding facilities.” 

Community hospitals rely heavily on revenue derived from outpatient services. While teaching or academic hospitals can rely on inpatient revenue from complex and unique cases in which they receive higher reimbursement, community hospitals are more squarely dependent on outpatient revenue. And while those revenues are increasing it may be true that market share is slipping.

It’s fairly easy to determine market share for inpatient admissions but, in most states much more difficult to determine market share for various outpatient services. Therefore a hospital can easily become comfortable with their increasing revenue from outpatient services. But that could be a false comfort if competitors are growing at a faster rate and their piece of the pie is growing proportionally larger.

That’s why it’s important to dig deeper, find and utilize research tools to help determine market share in the different areas of outpatient services. And those services must continue to be marketed those even when the hospital is experiencing good growth. We cannot be satisfied with growth, we have to fight to also increase market share.

And to complicate matters, hospitals can anticipate declining margins on outpatient services as well as increased competition. And the consumer more readily has ample choices where to receive those services.

Things are not always as they appear. And a hospital’s growth in outpatient services may not at all be as good as it seems. While a hospital may be growing, it may be losing ground. We have to make sure we have our eye on the right thing – market share.


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