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Event Recap: Healthcare M&A from and Around the AHLA Transactions Conference

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Healthcare mergers and acquisitions are having an interesting moment and were quite the topic of interest at April’s American Health Law Association’s Health Care Transactions Conference. As has been reported numerous times over the past year or two, the number of deals has dropped but the average size has gone up. Questions about how the current administration and FTC would approach consolidation have been a talking point across industries since now-President Biden won the presidency. Some massive deals go through, others get scuppered. And in the middle of these moves by traditional providers, private equity continues to evolve its role in healthcare delivery, bringing organizations together and backing them with capital and operational guidance.

With that backdrop, we circled back with a few of our AHLA friends to get their impressions of the current healthcare M&A environment. Specifically, we asked them:

  1. What were your top two takeaways from the event or conversations surrounding it?
  2. What was the biggest surprise?
  3. In light of the above, what are the top considerations for provider organizations to successfully navigate a transaction today?

Here are the topline takeaways. Quotes from the experts follow.

Themes

Uncertainty and concern around regulatory scrutiny of deals remains. And it’s not just from the FTC, but from states, as well.

The cost and shortage of labor, particularly travel nursing, is having downstream effects on the cost of doing business and patient outcomes.

Surprises

In the PE world, valuations are rising but not always for reasons one might expect. In many cases, multiples are pushing valuations as much as margins are.

It’s not just small, independent organizations that are being buffeted by a tough financial outlook. It’s a rocky landscape even for large systems, and that will likely be seen soon in M&A volume.

Across the board, seasoned industry veterans are expressing a notable level of concern thanks the rising cost of doing business and the added scrutiny on transactions.

Advice

Running a clean, organized transaction process is more important than ever.

Get counsel involved early to stay ahead of regulatory roadblocks.

Make the case for a deal – clearly and early.

Rex Burgdorfer

PARTNER

Health systems we talked with have been upended by the trend of traveling employees, especially nurses. In many cases, the cost structure of the organization has risen by 20 percent. The impact can not only be felt in the financial statements, but also in quality and safety measures. Temporary staff are often working in unfamiliar departments, with new equipment, and without the muscle memory on a team. The New York Times covered this well a few ago:‘Nurses Have Finally Learned What They’re Worth’

What were your top takeaways?

Health systems we talked with have been upended by the trend of traveling employees, especially nurses. In many cases, the cost structure of the organization has risen by 20 percent. The impact can not only be felt in the financial statements, but also in quality and safety measures. Temporary staff are often working in unfamiliar departments, with new equipment, and without the muscle memory on a team. The New York Times covered this well a few ago: ‘Nurses Have Finally Learned What They’re Worth

What was the biggest surprise?

The degree to which historically high-performing systems have been shaken in 2022 was a surprise. While we don’t yet see the impact on M&A volume statistics, I think we will in the coming quarters.

What are top considerations to successfully navigate a transaction

Transparency is key. Designing and implementing a competitive process to provide fiduciary decision-makers with a basis of comparison has always been central to demonstrating to regulators (e.g., state attorneys general) that the terms and conditions achieved in a particular transaction are “fair.” Where a lot of systems go wrong is not using the LOI stage to proactively communicate the rigor of the market clearance, the rationale behind the combination and merits of the partnership to AGs.

Krista Cooper

SENIOR HEALTHCARE ATTORNEY

What were your top takeaways?

My biggest takeaways were related to the conference’s antitrust track. Essentially, between the FTC’s new “holistic approach” to merger review and the increased scrutiny on affiliations, we can expect more vigorous reviews on the federal level. When you layer that with new state laws requiring pre-transaction notifications, the shifts could have material impacts on the approach and timing of some transactions.

What was the biggest surprise?

Given the pace of PE transactions in 2021, I was surprised to learn that unspent capital is still near record highs.

What are top considerations to successfully navigate a transaction

Prepare and prepare some more! Provider organizations considering a transaction would be well served to understand their organization’s operations, the market conditions, and the basics of the regulatory landscape. Deals are still moving very quickly whenever possible, and being well organized with good professional support can make a big difference.

Jay Greathouse

PARTNER

What were your top takeaways?

Whether it is on the equity and funding side, or on the compliance side, healthcare transactions are under a tremendous spotlight from every level. Couple this scrutiny with a greater demand by sellers for creative upside capture (e.g., earnouts, aggressive liability limitations, representation and warranty insurance growth, etc.), and there is significant pressure on what the market will support in transactions.

What was the biggest surprise?

Healthcare transactions are always under scrutiny, so many practitioners see it as simply part of the practice. But hearing so many seasoned practitioners raise the flag on the new long-look landscape was eye-opening.

What are top considerations to successfully navigate a transaction

Transaction fundamentals matter more than ever. That means good governance behind an organized, clean transaction process being run by reputable counsel. Add in the antitrust scrutiny and greater examination of transitions, and I think we will see an uptick in deals that stall, fail or unwind – and that’s when the quality of the transaction will be examined in the public and courtroom.

Jay Harris

PARTNER

What were your top takeaways?

The keynote speaker discussed the returns on investment for private equity investments in healthcare. One of the statistics mentioned was that almost half of the returns enjoyed by PE investors in healthcare in the last decade have come from the increased multiples. Meaning, the improvement in multiples provided as much of the return on investment as revenue increases and margin improvement combined. Can we expect multiples to continue to increase over time from current levels?

Michael Ramey

PRINCIPAL

What were your top takeaways?

I heard an overall uncertainty, and some anxiety, regarding the level of anti-trust enforcement going forward. The administration has definitely communicated an increased focus on healthcare transactions, but the level of enforcement beyond acute care seems to be uncertain.

Also, an interesting fact conveyed by the keynote speaker is that valuation creation in private equity-backed entities, historically, has been through revenue and multiple expansion, not margin expansion. That leads to the question if such growth is sustainable.

What was the biggest surprise?

The biggest surprise to me is the prior noted comment regarding the lack of margin expansion in private equity-backed deals. This runs counter to the MSO model of creating efficiencies through scale to generate incremental value.

What are top considerations to successfully navigate a transaction

I think the tried and true approach of involving competent healthcare legal counsel early in the process to navigate regulatory and transactional landmines remains key, along with involving healthcare-specific financial and compliance advisors. Several stories were shared at the conference of bad outcomes when this isn’t followed.

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DigitaLee 7: Diversity in Healthcare Advertising, Accessible Content and Supporting Healthcare CEOs

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Welcome to DigitaLee, the podcast for healthcare marketers, where we look at the digital news, tools, tips and tricks for effective healthcare communications. This week, David Shifrin and Lee Aase look at an article from Fierce Pharma that describes a marketing and ad agency building out a dedicated team to work on diversity in advertising. Then, they check in on the conventional wisdom around ways to ensure that content is broadly accessible and close by talking through the role of healthcare marketing teams and supporting the CEO.

Listen and subscribe to the podcast, or read the transcript below.

Episode Links

Read the transcript

David Shifrin: Well hey, Lee, good to talk to you again. We’ll jump in here. And episode seven, we’re about to have seven of these things, what do they say, in the can? So, for this first story here it’s from Fierce Pharma. The title is “CMI Media Group launches new practice to help pharma reach out to diverse audiences.” And of course this is coming in the midst of what’s really at this point a two-year elevation of diversity, equity, inclusion, health equity. And really rethinking how healthcare as a whole and how we as society approach equity.

It’s a really important push and all the social change that we’ve seen. And so this is just another thing, inclusive marketing. The quote to latch onto here I think for me was that… it says, “With new technology that’s allowing brands to target messaging to specific audiences like never before, there’s a big opportunity for pharma to be more inclusive and equitable in its messaging, said the chief media and innovation officer at CMI.” And so again, this is focused on pharma, but I think the ideas here apply to healthcare providers as well. So you know, what’s your, what are you looking at in terms of inclusive messaging when it comes to any new pushes or new technology, new campaigns?

Lee Aase: Yeah, I think the newer technologies that we have just make the content production much more cost-effective, much more inexpensive than it’s been previously. So I think spending some time on listening to people coming from different backgrounds and perspectives and better understanding what sort of message will pull through with them better. It’s like an online focus group, kind of using social and digital as a way of gathering intelligence in terms of what kind of messaging is going to have impact. And then just being really focused on, okay, what are some of the broader initiatives that we have and where can we specifically reach out in a particular area of need?

So for instance, colorectal cancer is something that affects everybody, like affects all races, all ethnic groups. The African-American community has a higher incidence and a need to potentially get screened earlier, typically. And so being thoughtful about how you can be doing that messaging, how you can be finding the right platforms to be able to reach the particular audiences I think is something that has been a priority and should continue to be, and not just pharma but provider groups as well, to be really proactive in that outreach.

David Shifrin: Do you think this is new? Or is it just that we’re in a moment socially and technologically where people are thinking about it in a slightly different way?

Lee Aase: Yeah, I think it’s just becoming more easy to execute on this kind of outreach. I mean, there definitely is a heightened awareness and a heightened interest and wanting to be very proactive in reaching out to people. And one of the top things that was mentioned in the article is a particular genetic disease that the founder of this group, this innovator, had, that his wife was Cambodian and there’s a particular disease that affects Asians more and some members of his family had been diagnosed with it.

And so just a recognition that more than ever before, there’s an opportunity to achieve business goals that are important and are sustaining to the enterprise while at the same time being able to target messaging to a particular audience in a way that’ll be more attractive to them and resonate with them and cause them to maybe even collaborate and share in spreading the message.

David Shifrin: Yeah. Okay. I thought what you said at the beginning of that answer was interesting, where you said it’s easier to do. And I don’t want to put words in your mouth; when I hear tha,t my reaction is okay, if it’s getting easier, then there are fewer excuses to not do it. So let’s do it!

Lee Aase: Right. Yeah. I mean the cost of production of this stuff and being able to tailor things is getting easier. The cost of listening. With the way the ability is as AI and other tools are enabling you to get… at least to bird dog some insights, that for them, the humans, to come in and say, okay, how do we do this in a genuine way versus just what the borg would say in response to this that we’re gathering.

David Shifrin: Okay. So for our trend this week – I created an awkward transition here, but I don’t know, maybe it’s not that awkward – but then thinking about another type of inclusivity, I was thinking about this actually producing our content for Jarrard recently. And it’s making sure that content is accessible for folks who may be visually impaired or have hearing impairments, or whatever it might be.

And so we hear a lot of things about…it’s stock at this point, I think, ensuring that you have all texts on images, that you have an opportunity for having subtitles on videos. And I think that’s not only for folks who may be hearing impaired, but just if somebody is in an office and they want to watch a video, they need to be able to see what people are saying. Anything that you’ve seen or you’ve thought about in terms of making content as broadly accessible as possible, or is it just keep doing what we’re doing?

Lee Aase: Yeah. Yeah, I think that’s a good, so it is keep doing what you’re doing and maybe expand it a little bit, and I would also say that it’s one of those things where you’re doing well by doing good, because it isn’t just that it’s more accessible for the visually impaired or hearing impaired.

That’s all true, but also the fact that it’s helping you with your SEO, as you mentioned, as people are doing the…if you’re doing captioning on videos, for instance, not so much the SEO side, but the captioning of videos, a lot of people are in a place where they can’t, they don’t have the liberty to play the audio.

But also just stopping the thumb as people are scrolling over something in the feed. If they’re seeing the words that’re there, it’s more likely to draw them in, so it’s about effective multi-sensory communication. And if you do that for people, so it’s multisensory communication for people who have access to all those senses, but for those who lack them, it’s at least making it, or giving them an entrée.

I’d also say the overlooked thing is the extended captions on videos, not captions, but descriptions, particularly on YouTube because that’s part of the whole SEO process. And also then the ability to include links within the videos. That’s not exactly the undiscovered territory, but maybe the forgotten territory.

It’s one of those things that people could put more focus on and get for a relatively small investment of time. Especially when you have the ability to do natural language translation of… an AI translation of audio. If you can get that converted to text pretty reliably, then using that not only in the caption but in the description (or good substantial sections of it) to the extent that the character counts allow is a good thing.

David Shifrin: Okay. Yeah, we just ran a survey of the U.S. population, 800 adults, about communications preferences and found that… we asked people, what do you prefer? Written texts, audio, video, or no particular preference and consistent with what I think the conventional wisdom is people largely preferred video.

And so it was just a reminder to me that we gotta make sure that, one, we’re producing content in ways that people want to consume, but then also making each piece of content as accessible as possible.

Lee Aase: Yeah. The other thing related to that is, yeah, people prefer video and some people prefer text, and some people, and also would like to be able to zoom through it more quickly, because one of the things people do is the 1.25 or 1.5 speed on the video sometimes to just get through them more quickly, videos and podcasts. Not this one, of course they’re going to want to catch every second of it and totally enjoy all of it, but…

David Shifrin: Pull your car over, pull up the car and get the notepad out. I think this is gold here, folks.

Lee Aase: Yeah.

But the other part is that people like to…and there’s something about, especially if you have an extended video or an extended audio it isn’t, yeah, that taking notes part is a little more complicated. So that’s why we put timestamps in, lots of times, in the podcast to say hey, this is where this was talked about.

And so incorporating that I think in some of the video descriptions is a winner.

David Shifrin: Cool. And I’m taking this section a little bit long, but I will mention, because you mentioned transcriptions, and two platforms that I’ll highlight…actually three, and let the secret out. One is otter.ai. It’s great for meeting notes. You can sync it to your calendar, and it does a really nice job. It’s more for just general meetings rather than content production, but it does a nice job and it has live real-time transcription. And the other one that we’re recording this on right now, the platform that we use for remote video and podcast production at Jarrard is riverside.fm.

And ask my colleagues, I talk about it probably more than I talk about my own family, which is concerning, but it’s a great platform and not too long ago, a few months ago, they now have an option with some of their packages where you can get a transcription of your videos.

And so what we’re doing, everything you’re hearing right now is recorded remote with really high quality, and we can pull transcripts. So there’s that. And then the last one that I’ll mention, which is what I use to edit these podcasts, also has a video editing feature, is Descript that and has an outstanding transcription service that’s built in.

And that’s what I do. But it’s a really nice way to scroll through, both for production and then taking that, converting it to subtitles, whatever it might be.

So the tools, to your point, Lee, are out there, and they’re not expensive.

Lee Aase: Absolutely. Yeah, that’s great stuff. And that’s application for me just in our clinic that we’re starting cause I’m the chief administrator, CEO plus the social media guy, for now. And so being able to have some of these tools that can make that production more streamlined—that’s stuff I’m taking away, too.

David Shifrin: Alright Lee, so for the last section, we also in a previous episode talked about how executives can think about their personal presence on social media, both as individuals and as representatives of the organization.

And I want to think about how marketing and digital folks and healthcare organizations can come alongside their leadership, their executive teams, to support them. So I guess the question here is, what is the role of healthcare marketing in first supporting CEOs, and then helping the organization through leadership, transitions, things like that?

Lee Aase: Yeah. I mean, I think, so part of it is, the CEO is one of the chief assets of the organization and, as the face and the voice of the organization and obviously as a driver of the strategic direction. And being able to harness that voice and being able to accomplish what the strategic goals of the organization are is what being the CEO is all about.

So there are some who are naturally inclined toward that, and then there are others who are obviously good communicators in business communication and active and being able to accomplish their work, their will through the organization, but they might need a little help, might need a little handholding in terms of how to be most effective in their use of these social platforms to represent themselves and the organization.

And so I think just making, considering the CEO communication as a pillar of the overall strategic plan and then figuring out how to harness that by, for instance, video, we talked about how video’s been a big part of the topic, but in our experience with our clinic, we’ve got Dr. Dave Strobel, who’s a 30-year physician. Does a great job explaining things to patients, but if he were to…I don’t want him to be on social media, like I don’t want him to be personally doing it, but yet if I can capture video of him doing descriptions, explaining things and then do some post-production, it’s really good work, but you know, really elevating the value that they can contribute.

Really harnessing that and then adding the right people to do the editing to present that authentic voice, but then also to do the bird-dogging to say, hey you’re getting some reaction to this and calling them in to be able to comment as necessary so that there is that authentic level of engagement that’s meaningful instead of it…if it feels too polished, then it’s not going to have the effect, either. I mean, most of the reason people get into these CEO roles is because they’re good with people. They’re good at communicating. They can help move things along. And the digital and social is just a way to supplement that.

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When Hospital Executives Move On

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Note: This piece was originally published over the weekend in our Sunday newsletter. Want content like this delivered to your inbox before it hits our blog? Subscribe here.

The Big Story: Hospital CEO exits nearly double this year

“Twenty-nine hospital CEOs exited their roles in the first three months of this year, nearly double the 15 chiefs who stepped down from their positions in the same period of 2021.”

What it Means for Healthcare Organizations

(four-minute read)

The doctor is in. But the CEO may be out.

Whether due to retirement, ouster, opportunity or entrenched burnout, we’re in the midst of significant turnover at the top levels of healthcare.

Even before Q1 2022, healthcare executive turnover was high: The hospital sector had the fourth-highest number of CEO exits in 2021 of 29 industries evaluated in a 2021 year-end report from Challenger, Gray & Christmas. The study also found that hospital CEO departures were up 11 percent relative to 2020.

Why? There are a few possible contributing factors…

  • Burnout. This one always rises to the top these days. The pressure of shepherding hospitals through the most phenomenally challenging years in modern healthcare history took a toll on CEOs.
  • Bowing out. Many CEOs were approaching retirement age at the time of the pandemic. Yet they held off to maintain continuity through the extended crisis. Now they’re deservedly on the golf course.
  • Bottom line. Q1 finances were ailing and the outlook is uncertain. “Inflation concerns have some boards looking to new leadership to weather the coming storm,” said Andrew Challenger, whose firm ran the numbers on CEO departures referenced in the articles above.
  • Distance. Many CEOs were less visible during the pandemic due to the frantic nature of the work. With less CEO rounding and few opportunities to gather as a system, the separation between leadership and staff only increased. This wouldn’t necessarily directly cause an exit, but could erode support for the exec.
  • Hospital M&A continues apace. Elsewhere, hospital closures are happening. That could mean more movement, and perhaps musical chairs with fewer spots.
  • The lure of the new. Amid all of this is the attraction to new opportunities outside of the four walls of the hospital. PE money is flowing, and good talent is in demand outside of the acute care setting.

Those are some “whys.” Now let’s flip the script and consider executive transitions, as, well… an opportunity. An opportunity for the board and other leaders to evaluate and retool; an opportunity for the new leader to bring new ideas. If you’re staring down – or anticipating – an executive transition, here are just a few opportunities and challenging either/or options people will be considering, whatever their vantage point – on the board, in the C-suite or leading a marcom team.

For Boards:

  • Imagine the organization’s life after COVID-19. Then ramp up with a leader who understands the likely characteristics of healthcare’swinners and losers.
  • Debate between retrenchment and adjusting to encompass more transformation and creativity.
  • Weigh whether to bring in an outside candidate with fresh perspective but less context, or an internal one with institutional knowledge but possibly a narrower perspective.
  • Look for candidates with some risk tolerance. They’ll need it for this new era of healthcare. The person stepping into the vacancy will have a long list of priorities and a chance to not only adjust course for the organization but also potentially help reshape an industry.
  • Use the organization’s communications pros to help the board turn vision into a cohesive story that bolsters support for the transition internally and in the community.

For Executives:

  • Listen first and intently throughout the organization and community to understand and connect with hearts and minds before making bold moves.
  • Balance the financial and operational imperatives, mandates from the board and the opportunity to make changes – or double down.
  • Educate the board on opportunities for change and ideas for adjusting the organization’s strategic vision.
  • Bring context to clinicians, staff and the community about the challenges of today and the importance of making key moves in time that benefit tomorrow.

For Marcom Leaders:

  • Help the new CEO and leaders to push the board to think in new, positive ways about transformation and consider questions that start with, “What if we…”
  • Encourage leadership to evaluate, reinstate or rethink how they interact with various stakeholder groups, particularly when it comes to in-person collaboration and events.
  • Seize this moment to assess every aspect of the organization. Find the stories that showcase where things are headed and help leadership explain to employees and the community why transformation is necessary and how they can be involved.
  • Know that even without a leadership transition, now is a good time to refresh. The past two years have been traumatic, and marcom should help the organization ask the questions, “Who are we today?” “What do we value?” and “How do we work together?”
  • Take pride in the critical role that the communications team plays in carrying the emotions of team members through a challenging time. The win? Ensuring people feel optimistic about what’s next and their ability to tackle it.

This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.

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Post Q1 Woes – Picking Future Winners and Losers

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Note: This piece was originally published over the weekend in our Sunday newsletter. Want content like this delivered to your inbox before it hits our blog? Subscribe here.

The Big Story: Rising expenses at hospitals are unsustainable, AHA says

Prior to the pandemic, hospitals spent about 4.7 percent of labor expenses for nurses on contract travel nurses. That figure grew to about 39 percent in January, according to AHA report. The current trajectory for hospital expenses isn’t sustainable.

“The dramatic rise in costs of labor, drugs, supplies and equipment continue to put enormous pressure on our ability to provide care to our patients and communities,” AHA President and CEO Rick Pollack said in the statement.

What Comes Next

It was a dismal first quarter for healthcare providers. Of course there are some hospitals andhealth systems that are in a better spot, getting good marks from Fitch and Moody’s. But on the whole, the numbers have been bleak.

Today, we’re looking at forces currently pushing and pulling the industry and inevitably reshaping the provider landscape. The definition of success here is both idealistic and practical. It is both financial viability and the ability for a system to appropriately deliver on its mission to care for patients. We know the balance sheet must add up, and your CFOs need a clear path to sustainability, but ideals are also good.

So, let’s put the numbers aside for a moment. What will it take for healthcare providers to evolve successfully for the future?

  • The hospital becomes the center of acute care, and little else.
  • Delivery of care takes place in varied settings, from specialty outpatient clinics to the local grocery to the patient’s home to the patient’s texting app.
  • Specialization and expertise will become the watchwords, with health services companies stepping in with innovative, flexible services and private capital contributing resources and a keen operational eye.
  • Partnerships will also become more varied and collaborative, with the new hospital working in tandem with other types of healthcare organizations to provide a distributed, yet efficient and high-quality patient journey.

Certainly, there’s a long way to get from today’s messy Point A to an idealistic Point Z, but a shift in what constitutes risk and a willingness to undertake hard change will be critical to sustainability – and maybe allow your CFO to sleep better at night.

Here are our bets on what factors will contribute to a system winning or losing in the new healthcare ecosystem.

Healthcare Winners

The core trait of a healthcare organization that will make it through is a recognition that creative transformation is less risky today than taking a defensive posture. Remodeling, not rearranging furniture, is needed to establish sustainable models of care going forward. Other aspects the winners should consider:

  • Value-based care. Fee for service is predicated on, well, services. No volume, no revenue. The decade-long push towards value has likely reached a tipping point when there’s no other option.
  • Alignment, not employment. Hospitals are looking at offloading physician groups to PE-backed companies and entering operating partnerships to ensure continuity of care without having their employment contracts on the books. It’s one form of streamlining the labor issue where each entity can focus on managing that which it is best at.
  • Private capital. Beyond just staffing models, many traditional provider organizations are looking to sell non-core services like labs and even some specialty practices like orthopedics and cardiology to get them off the balance sheet. Meanwhile, PE is ready with capital to deploy and operational expertise to ensure quality of care and financial sustainability.
  • Scale. Certainly, the ability to centralize operational departments – revenue cycle and the like – and standardize others is helpful. In addition, a smaller hospital that aligns with a large system will obviously have access to resources that can help them to stay open. Deals were down in Q1, but assuming the financial pressure continues to build, that trend could very well reverse.
  • Low debt. Enough said.

Healthcare Losers

Here, it’s largely the opposite traits. If flexibility and risk-taking wins, rigidity loses. Yes, there are some factors that are tough to control or change – like serving largely susceptible populations. But doubling down on the way things have always been done will only compound those concerns.

  • Rigid care models. Better develop that VBC playbook.
  • Susceptible populations. Serving a population with a high proportion of at-risk patients is problematic when reimbursement is difficult. The caveat is that this challenge is greater in a fee-for-service mindset. Flexibility and creativity in what it means to provide care can help mitigate this point.
  • Being all things to all people. Trying to do too much and spreading the organization too thin when resources are scarce rather than focusing on core expertise.
  • Stay the course. All told, continuing to view the hospital as the core of healthcare delivery is a surefire bet for a slide into unsustainability. Defensiveness and cost-cutting can only go so far before quality suffers and the organization is forced to offload services or shut down. Why not do that proactively and productively from a position of relative strength rather than hold a fire sale?
  • High debt. Enough said.

This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.

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DigitaLee 6: NFT or WTF, Healthcare in the Metaverse & Digital ROI pt. 2

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Welcome to DigitaLee, the podcast for healthcare marketers, where we look at the digital news, tools, tips and tricks for effective healthcare communications. This week, David Shifrin and Lee Aase are both confused by CVS moving into selling virtual healthcare goods. Once they get past that, they look at provider organizations planting the flag in the metaverse, and then it’s the second of our two-part digital ROI miniseries, this one on how healthcare marketers can position digital programming to justify the ROI.

Listen and subscribe to the podcast, or read the transcript below.

Episode Links

Read the transcript

David Shifrin: I’ll be honest. I’m confused by this story today. It’s from Healthcare Finance News and it’s, you know, I’m confused, but got to talk about it. I want to talk about it. “CVS Files Patent to Sell Goods and Healthcare Services in the Metaverse.” And when you read through the article, it’s not exactly clear exactly what CVS is going to be selling, because if I fall and slice my hand open, I don’t need a metaverse stitching and bandage, I need an actual emergency room. But this is continuing with this rapid rise in stories that we’re seeing about what the metaverse is doing and can do. And of course, Facebook has rebranded to become Meta and virtual reality is here and expanding.

So yeah, what is your take on digital goods and services?

Lee Aase: Yeah, I thought I was confused by it as well, because it says, you know, “CVS Health wants to trademark its logo, establish an online store, create downloadable virtual goods ranging from prescription drugs to beauty and personal care products.” I’m thinking, are we going to have a virtual opioid crisis?

Or what’s the deal? Just like, how does virtual work in that? So I’m not really sure. I think there’s, I mean when it really gets down to it, I think some of the telepresence stuff that was talked about in the other article that we’ll be talking about, and I apologize for jumping ahead with it, but it seems like the, it seems like the immersive experiences for really making that virtual connection be much more like face-to-face.

And perhaps even in some ways because you can have some digital measurement sensors attached with them, I think there are some opportunities to really enhance that experience. I think the main thing, the main thing out of this story is something that does relate to what I’ve advocated for a long time, is that when a platform comes out that it’s really important for big brands to be staking their claim, you know, that they don’t want somebody else to be squatting on their name.

We had an experience when I was at Mayo Clinic that we had, there was a British rock band that set up a page on MySpace called Mayo Clinic and the band’s name was Mayo Clinic from County Mayo in Ireland. And they thought that was cute, I guess, but so that gave us some impetus for being able to say hey, we should set up… This was back when Facebook pages were the new thing. We said let’s set up a page on Facebook to make sure that nobody else claims that. So I think this is just sort of taking that next step on the legal front, that where CVS is saying, okay, metaverse is going to be a thing, so let’s at least stake our claim here, and set out the stakes that we are CVS in the metaverse and nobody else can use that.

David Shifrin: So it’s protective as much as it is proactive.

Lee Aase: I kind of think…so, I mean, that’s what it looks like to me because I have a hard time wrapping my head around how virtual goods can be. I can see virtual services totally. But virtual goods seem a little bit disconnected.

David Shifrin: Yeah. Well, and the article also mentioned that they’re talking about potentially selling NFTs, non-fungible tokens, which is a whole other Pandora’s box that we’re not going to get into right now, but that’s the other big thing. And again, personally I don’t see the value in buying any, I don’t know what kind of NFT CVS is going to offer me that’s going to make me want to spend the money, Bored Ape Yacht Club isn’t even enough to get me interested. So I don’t know what CVS is, but…

Lee Aase: Yeah, I think there’s, you know, NFT and then there’s another acronym that uses both T and F as well, but maybe kinda…

David Shifrin: I think we found the title for this episode.

All right. Before this goes off the rails Lee, let’s move into the second section which, as you telegraphed, is more on the metaverse, again not really a platform specifically, but a digital place. This is from a Forbes contributor named Bernard Marr who writes on enterprise tech. The title is “Amazing Possibilities of Healthcare in the Metaverse” which got us thinking again, the metaphor as a place, as a platform of sorts. There’s sort of three areas that Marr references: telepresence, which you’ve mentioned, digital twins, which is really interesting, and then blockchain technology, which we hinted at there with talking about NFTs, but you know, some of this stuff is pretty immediate—I think like the telepresence of being able to offer telehealth visits in the metaverse or simply just by good old fashioned Zoom call. And then some of it like the digital twins is incredibly fascinating and I think promising, but a much longer play. This is mapping people’s genetics, so they can, we can experiment virtually and to see how we’re going to respond to treatment. So what are you looking at as the metaverse continues to get more, more traction?

Lee Aase: Yeah. I mean, I definitely think the telepresence part has a lot of application right away. And I think that’s where organizations could, especially in things like counseling and therapy sort of approaches, be able to have that much more immersive experience; to have it be much more like being there would be I think that’s a no brainer. And then, and finding…so I’d suggest that for organizations, finding someone, finding an advocate within the organization, within the clinical areas, who’s really interested in applying this, coming around them and helping them to prove the concept and show the value I think is really a good opportunity.

The digital twinning does sound fascinating. I just think it’s hard to…I think it’s problematic in just even as you note, as you map the whole genome, how do you know exactly whether you’re taking into account the right factors as you’re fast forwarding through 10 years, about what happens with, you know, the whole idea of like, you take a twin and you say, okay, maybe you could run a thousand simulations and be able to then come up with a… Actually as I think it through, I think that might be it, the Monte Carlo simulation with digital.

So it’s not just digital twins, it’s digital…you’re creating a population out of the twins. So just as with Moore’s law and the power of computing increasing exponentially, probably eventually at some point you’d be able to run those sorts of simulations that might give you a better sense of what the range of possibilities would be, given a different intervention.

David Shifrin: Okay. In the meantime of that while the scientists and the data folks are trying to figure out how to do all of that – and we just talked about kind of staking a claim in wherever you are as an organization – the metaverse becoming a more powerful place for brands to engage.

And so any other prep work that folks should be thinking about? Whether that’s with HIPAA compliance, training clinicians to be thinking about one day possibly entering virtual reality to deliver telehealth, anything along those lines?

Lee Aase: As I alluded to a little earlier, I think the key is to find the champions, to find the early adopters who are willing to experiment and learn. Willing to help sort out what the issues are going to be, so that then the organization can apply it on a broader scale.

So it’s part, and this kind of relates, probably segues into our ROI discussion for this time, that, as I mentioned before in my thesis, that as the I approaches zero ROI approaches infinity. One of the big ways that you keep the I low is by getting people to volunteer—by getting people who are already on staff to say wow, this is really cool and I want to focus my energy on this. I’m willing to dive in and put in my own effort on it.

And so that’s that kind of makes the organization more like a startup, you know, even an established organization where you’ve got a lot of people that are psychically betting on exercising options, so to speak. I mean, they’re trying to, they’re creating some psychic ownership in a new trend and because of the personal satisfaction that they get out of leadership in an area like that. So I think finding, identifying and recruiting people from within the organization that you already have to say would you like to play? would you like to be involved in this? is a way to be able to demonstrate that the potential to demonstrate the return without a major outlay of additional resources so that you can prove the concept and then hopefully make the case for a broader adoption.

David Shifrin: Okay, in our next conversation, we may, maybe we’ll talk about kind of setting up how you set up a sandbox with enough guardrails to be careful but also giving people the freedom to test that out.

In the meantime: digital ROI part two and talking about how healthcare marketers position digital programming to justify that ROI.

And you’ve talked about it last time, and then just before this is the last thing you said there was hopefully take the results on to the rest of the organization and leadership and show the value. What does that look like? How should digital marketers think about helping to get their leadership teams bought into these programs that they’re testing out?

Lee Aase: I think the first thing is they have to be solving a real problem that the organization is either spending money on now or creating new opportunities for generating income. So it’s either, how can you concretely save money through some of these digital innovations?

So for instance, if it’s telepresence, okay, you’re saving time on travel in between meetings and you’re enabling people to be able to be more…have less overhead in terms of those face-to-face relationships and interactions. So figuring out ways that you can measure and make the case for that, for the savings that are coming there. But then also beyond that in testing and learning and seeing where the additional revenue opportunities are, and by trying this out are we able to make additional connections that will lead to patient volume, will lead to memberships or whatever the model is of acquisition?

David Shifrin: Alright, Lee, well, thanks!

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Special Report: Intro to Healthcare Communications 2022

A cartoon image of a living room with a news anchor on the TV screen with banner that reads "special report" and a fish in a fish tank on the side dresser

Let’s make this multiple choice. Pick one or more to describe takeaways associated with current communications trends.

A. People have the attention span of a goldfish.

B. Local news is dead.

C. People aren’t willing to consider opposing viewpoints.

D. People trust family and friends.

E. People don’t trust institutions.

F. People watch, not read.

G. All of the above.

You went for G, right? Because when it comes to communications today, each of those axioms pops up with regularity. It’s impossible to catch – and hold – your audience’s attention. There’s little room for discourse. And we won’t even start on the impact of short, flashy and content-lite videos published to TikTok, Snap or YouTube.

How’s anyone supposed to cut through the noise when there’s a serious point to make and the world is distracted scrolling through memes?

We know. But first, let’s see if your choice was correct. Our proof points come from a survey Jarrard Inc. conducted in early April. Responses that follow come from 800 US adults who answered questions about how they prefer to receive information, how often and whom they trust to provide it.

Here’s what we found:

A. People have the attention span of a goldfish

58% Regularly read long-form content

Not exactly. People do prefer shorter content. But they will take the time to go deeper. More than a third of respondents said they’re more likely to read short-form content on any given day, versus just 15 percent who said long-form. But a plurality – more than four in 10 – said the average day was likely to include both. In addition, 58 percent said they read long content a few times a week or daily – the same total as short content.

On an average day, are you more likely to read long-form or short-form content?

Donut chart with 6% "unsure," 15% "long," 37% "short," and 43% both

B. Local news is dead

Wrong. It’s not. Well over half of survey respondents selected local TV as a source of news, and more than a quarter picked it as their top choice.

Where do you go for your news? (Pick all that apply)

A bar graph with the x-axis representing news sources and the y-axis representing percentage (up to 60%).

What is your top choice for getting news?

A bar graph with the x-axis representing news sources and the y-axis representing percentage (up to 30%).

Though perhaps surprising, these findings are consistent with other studies over the past few years. A rapid decline in local TV viewership was arrested and somewhat reversed during the stay-at-home days of the pandemic.

A collage of local news headline clips

C. People trust family and friends

This checks out. Especially the family part. Throughout human history, people have made their way into tribes and are skeptical of outsiders. It’s evolutionary hardwiring in place to boost safety and overall success. Ergo, it makes sense that when asked about who they trust, family tops the list in a statistical dead heat with doctors. An important note here about that trust in doctors: If you’ve been following our surveys for a while, you know that we consistently highlight physicians and nurses as trusted voices on healthcare issues. This survey – related to but distinct from that series – asked a more general question about whether people trust information in general from different sources, not just healthcare information. That doctors remain at the top of the list shows the depth of that inherent trust, even beyond their professional expertise.

The slightly wider circle of friends and neighbors is far less trusted, yet still sits at almost 50 percent. People want social proof and trust loved ones – even above information they find when looking for insight on a topic.

Importantly, though, expertise is still highly valued, with academic experts and nurses rounding out the list of most-trusted individuals. Family matters, but so does deep professional training. CEOs, brace yourselves. You barely avoid the bottom spot, perennially occupied by politicians.

C. People trust family and friends

This checks out. Especially the family part. Throughout human history, people have made their way into tribes and are skeptical of outsiders. It’s evolutionary hardwiring in place to boost safety and overall success. Ergo, it makes sense that when asked about who they trust, family tops the list in a statistical dead heat with doctors. An important note here about that trust in doctors: If you’ve been following our surveys for a while, you know that we consistently highlight physicians and nurses as trusted voices on healthcare issues. This survey – related to but distinct from that series – asked a more general question about whether people trust information in general from different sources, not just healthcare information. That doctors remain at the top of the list shows the depth of that inherent trust, even beyond their professional expertise.

The slightly wider circle of friends and neighbors is far less trusted, yet still sits at almost 50 percent. People want social proof and trust loved ones – even above information they find when looking for insight on a topic.

Importantly, though, expertise is still highly valued, with academic experts and nurses rounding out the list of most-trusted individuals. Family matters, but so does deep professional training. CEOs, brace yourselves. You barely avoid the bottom spot, perennially occupied by politicians.

How much do you trust information from each of the following sources?

(Scale of 1-5: 1 = Do not trust, 3 = Neutral, 4-5 = Do trust)

A horizontal stacked bar graph representing the percentage of trusted individuals

In general, how much do you trust information from…

(Scale of 1-10: 1-3 = Very little, 4-5 = A little, 6-7 = Somewhat, 8-10 = A great deal)

A horizontal stacked bar graph representing the percentage of trust by sources

D. People aren’t willing to consider opposing viewpoints

How likely are you to change your opinion based on a statement by/discussion with someone with an opposing viewpoint?

A donut graph with 13% "very likely," 26% "very unlikely," 35% "unlikely," and 26% "somewhat likely."

In the past year, have you changed your opinion based on a statement by/discussion with someone with an opposing viewpoint?

A donut graph with 20% "unsure," 39% "yes," and 41% "no."

This was quite the surprise. In this time of bumper stickers, polarization and tribalism, it seems counter to the conventional wisdom that people might be willing to consider ideas they don’t already agree with. Yet, almost four in 10 respondents say they had in the past year changed their opinion based on ideas from someone with an opposing viewpoint. And another 40 percent says they just might.

Of course, this is all self-reported and might reflect the respondents’ desire to be perceived as open-minded than actual open-mindedness in practice. Even so, this is cause for optimism. Because, at minimum, there’s a segment of the population that wants to be thought of as open-minded.

E. People don’t trust institutions

True. If family and doctors are highly trusted, CEOs are, well, not. Though not asked in the survey, it’s not a big leap to see how the idea of a “CEO” here could be interpreted as either the individual – the head of a corporation – or as a proxy for the corporation itself. The dark suit, if you will. This is a warning for any institution and leader. People are relational, looking for information and reassurance from other individuals while holding a notable skepticism of organizations.

F. People watch, not read

Video is king. If you’re in marketing and communications, you’re keenly aware that short, visually engaging content is the way to consumers’ hearts. Our survey reinforced this position. Almost half of people expressed a preference for video – 18 points above written text and 3.5-times more than audio. This doesn’t mean that other media are dead. Just that visual content must be a core component of any communications strategy.

Which format do you prefer for receiving/consuming news and information?

A donut graph with 14% "no preference," 46% "video," 28% "written text," and 13% "audio."

Advice

Those are the findings. Now, what does it all mean for healthcare communications?

From our survey, one core message supersedes all others:

There’s a tendency to measure success by activity, not influence. Yet the real movement may be hidden.

It’s away from measurable campaigns like social media and billboards. And it’s found in the conversations between doctors and patients, family and friends. The ROI of relationships and interpersonal trust is unquantifiable but invaluable.

For marketing and communications advisors, this is straight talk that bears repeating: Our activity is not “it.” The hard work is in earning the conversations that take place around the dinner table.

There’s hardcore – though perhaps not entirely quantifiable – benefit to “Dinner Table ROI.” The local and personal nature of communications, trust and healthcare – along with the high trust doctors and nurses continue to enjoy – means that healthcare brands may very well be sturdier than the hot-take Twitterati say they are. The experience a strong brand provides is far more enduring than a Twitter storm. If you’ve built a strong reputation, then when the hot takes come in, those dinner conversations will include a heavy dose of people telling their loved ones, “That wasn’t my experience,” or, “I’d still go see Dr. Smith.”

We’ve written before that providers should not passively rely on an historic positive reputation. Or on the personal trust between doctor and patient. Foundational as those things may be, they’re not inviolable. Patients can choose to follow a physician rather than a hospital. And the low trust in institutions means that no corporate reputation is safe, especially in a time when hospitals are under significant fire. We stand by that advice and suggest that the strength healthcare organizations maintain is a starting point to build from, not a resting place.

How to build? Forget the Three Rs. Your answer lies in Six Ts.

Time

The first step to moving someone to action isn’t giving them new information. It’s overcoming resistance to receiving new information. “It’s a long journey to persuade people even to receive the information, much less change their mind based on it,” said Teresa Hicks, associate vice president in Jarrard Inc.’s National and Academic Health Systems Practice.

So focus internally first to make the most of that time, says Abby McNeil, vice president in the National and Academic Health Systems Practice. While there’s a lot of value to be had in media relationships (see sidebar) healthcare communications leaders need to focus initially on physicians, employees, partners, and other internal stakeholders. “Because we trust people we know most, their experience, along with the patient/consumer experience, is what moves the needle fastest with brands either in a positive or negative way.”

Trust

There’s good and bad in the trust numbers from our survey. On one hand, it’s easier to receive information from a cherished sister or brother instead of reading a stack of articles for yourself. “There’s an element of comfort that comes from that relationship,” Hicks noted. Yet depending on the information shared between sisters, that could be a good thing – “Go get your COVID-19 vaccine!” – or a bad thing – “the COVID-19 vaccine contains tracking devices!”

Kim Fox, partner and Regional Practice lead at Jarrard Inc., added, “The dinner table is a safe place. You can explore your perspective and feelings there. You can openly be your true self, whereas you often can’t in other settings.”

For healthcare organizations, the charge then is:

And what of spokespeople? Well, your physicians, nurses and academic experts remain high on the trust list. CEOs? Not so much. We think that in many cases, the word “CEO” could easily be viewed by many as a proxy for “corporation.” When faced with a critical message – or even just day-to-day communications – provider organizations must be careful to use the person who is best suited to deliver it, even if that person may not be the most prominent. We typically see this in advertising: It’s white coats in hospital TV ads, not suits.

Of course, there’s also a big difference between “CEOs” in general and Jane Doe, CEO of Anytown Medical Center. So, there’s certainly an opportunity for any leader to be a trusted voice. That trust must be cultivated, which McNeil references in media training sessions. “I tell leaders they have to make deposits in the community trust bank daily, because at some point there will be an issue or a crisis, and they’ll have to make a withdrawal,” she said. “Those deposits happen at every single touchpoint with the brand.”

Last note here: Fox pointed out another subtle but important distinction in the trust numbers. “People don’t trust celebrities. Providers should be careful about if and when they use celebrities as spokespeople.” she said. “They’re known, but not trusted.”

Why Are Doctors So Highly Trusted?

We noted above that doctors aren’t just trusted on health information, they’re trusted even when the question is about information writ large. Why? Fox had an idea. Perhaps it’s because of their unique position as recipients of our secrets. “We may trust doctors because they hear things that we won’t say even to our families,” Fox suggested. While the dinner table is, in Fox’s terminology, a safe space, the doctors’ office is reserved for discussing a subset of deeply personal concerns. Arguably, clergy have historically held this position, yet they fell in the middle of the trust list in our survey (fallout from the decline of organized religion, perhaps).  Could it be that the knowledge that our medical caregivers know things about us no one else does lead to trust, or even force it? Or is the trust necessary up front for us to feel comfortable being open with our physician? It’s an intriguing chicken and egg question we don’t have an answer to but will be pondering.

Translation

Almost everything we know has been interpreted for us by someone who understands it better than we do.

Sounds scary, but is it? Not really. We need experts to discover and then translate since no one knows everything. Society needs specialists to develop ideas and make discoveries, but then it also needs a series of people to translate that information into something we all can use. And at the end of that chain must be a trusted, one-on-one interaction.

That’s why hearing from a family member is far more palatable than digging through mountains of primary literature.

So too with health information. Healthcare providers need to remember that the process of translation is good and necessary. Done correctly, the process makes the complex and unintelligible something that can be processed by, well, anyone who isn’t the expert. This means investing in people and processes that can review critical messages and adapt them as needed. It’s taking an active approach – not just asking a charismatic physician to go out and extoll the virtues of vaccines or colonoscopies. It’s building a pipeline to finesse information into a format and level that is exactly what the audience needs. Playing a huge role in this is your marketing and communications team who should both identify the core message, shape and review it for accessibility and then develop final products that engage the end user.

Training

Smart healthcare providers invest in training trusted voices to communicate effectively.

“We can work to make the people who can translate trusted,” said Hicks. “But… that’s a lot harder than finding someone who’s already trusted and giving them the skills they need to translate.” That doesn’t mean sending community leaders to a crash course in immunology and vaccine development, but it does mean sitting down with them and the specialists – those in the first and second layers of translation, if you will – to walk through the information, its impact and how people should respond.

You’re familiar with examples of health systems working with clergy to promote the COVID-19 vaccine. Another example could be a local facility engaging with EMS directors across a community to explain how and why consolidation of emergency services will work – and why it makes sense for the community.

“Whatever the topic is, finding the people who already have earned the trust of their community and investing in convincing those people to share the information is the way to go,” Hicks said. “Because this survey shows that people trust relationships more than they trust data.”

Tactics

Whatever the message and whomever the messenger is, how should it be delivered? Here’s where that preference for short form and video comes in to play. The data is clear and is largely consistent with marketing and communications best practices, so we won’t dwell on this tactic for long.

Still, it’s worth noting that the results reinforce the value of brief videos, delivered on a regular basis. People are looking at short-form news a few times a week. They strongly prefer video over audio and text. Therefore, they’re primed for that style of communication when it comes time to look at health information.

But remember that, despite the preference for short-form content, there’s a place for long-form. Those quick hit pieces can be backed up by deeper materials for those who want more. Fox noted that there is always a need for multiple channels. The survey, she said, reminds us that “People will still read a good story. Not everything has to be three paragraphs long. There’s a market there for deep content, as long as it’s well-written, well-researched and thoughtful.”

Touchpoints

By that, we mean experience. Consider the “body language” of an organization and the experience it offers. “Perception comes down to experience,” McNeil said.

The right words at the right time are important but not remotely sufficient. More significant is creating a good experience at every stage of the patient and employee journey through the organization. She referred to the survey data as “a callback to how we show up with patients and consumers, with employees and physicians, every single time.”

Remember that a sizeable portion of the population either is open-minded or wants to be perceived as open-minded. Remember, almost 40 percent of survey respondents said they had changed their opinion in the past year based on an opposing viewpoint. Both demonstrate sensitivity to social norms.

Therefore, those leading communications for provider organizations should be encouraged to keep up with efforts to persuade – whether the issue is public health measures or service line changes.

The key is to build those messages into bite-sized, emotionally compelling nuggets that can be easily delivered through personal relationships far away from the PSAs and media campaigns. Then, as the door is cracked wider, have ready more in-depth information that will build momentum towards the end goal rather than put people into vapor lock through confusion, defensiveness and decision paralysis.

Remember: Every opportunity to back the story up by a personal, positive and comfortable experience serves as a deposit in the bank.

“No presentation with vast amounts of data will be palatable enough to make someone change their mind,” said Hicks. “It has to be the relationship that does that.”

Closing Thoughts

Where’s Local Media In All This?

A key finding of our survey was that local news is not dead. What should healthcare providers do with that? Our Jarrard Inc. team has some thoughts on the state of the media:

  • Generalist Reporters. There’s a wide variation in local TV reporting. Many reporters are doing their best on limited budgets and lack of resources needed to specialize in healthcare, business, etc. As you work to form meaningful, educating relationships with the editorial staff or news director, work hard to translate and put the news into context for them.”
  • Relationship Building. Like anything, building that relationship takes time. Meet with the reporter or news director to talk through key issues and serve in that translator role. Ongoing, long-form conversations build a personal relationship and give the reporter a vested interest. Make them feel a partner in serving the community. Professional responsibility means journalists will want to know that they’ve done their homework, looked at both sides and appropriately simplified complex information so it’s available to the public. You can be an asset in this process.
  • Beware the Dark Side. We’re talking about the push for ratings, sensationalization. Provider organizations interacting with TV reporters need to be aware of details like sweeps week, the four times each year when ratings are calculated. Though it’s not necessarily a negative, Muck Rack’s 2022 State of Journalism survey found that reporters say having a subject connected to a trending story was the best way to make a story shareable. Similarly, local reporters are often working to move up to a bigger market. Most are doing that by doing great work and telling important stories well. But there are, as with anything, exceptions to that generalization. Ratings will be in the back of the reporter’s mind. Layer on top of that the need to tell stories in 30-90 seconds and there’s a risk of sensationalizing.

Want more specifics on how reporters want to be pitched? Here are a few very tactical stats from the Muck Rack State of Journalism report:

4 Average number of beats each journalist covers

84 % Journalists who consider academic experts credible sources

66% Journalists who consider CEOs credible sources

4
Average number of beats each journalist covers
84
Journalists who consider academic experts credible sources
66
Journalists who consider CEOs credible sources
94
Reporters citing direct emails as preferred way to be pitched

Questions about how to communicate more effectively with the audiences that matter? We can help.

Learn about our campaign approach to communications

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Jarrard Phillips Cate & Hancock, Inc. Continues Record Growth In 2022

Firm News

Firm adds to roster to better guide healthcare organizations through post-pandemic transformation

To keep pace with consistent client growth, the national healthcare strategic communications firm Jarrard Phillips Cate & Hancock has added 11 new staff members in the first four months of the year, according to President and CEO David Jarrard.

Growth occurred across all three client advisory practices and the firm’s professional services team. Headlining the new talent are Jason Poteet, vice president of business development and Abby McNeil, vice president in the firm’s National and Academic Health System practice.

Poteet joins Jarrard Inc. with more than two decades of experience in performance improvement, revenue cycle and revenue growth strategy. Previously, he served as a client solutions leader within the healthcare provider vertical of the global technology companies Wipro and NTT Data.

McNeil is a seasoned marketing and communications expert with an extensive track record helping healthcare brands engage employees and grow market share. Immediately prior to joining the firm, she oversaw corporate communication and public affairs for CHRISTUS Health, including leading their COVID-19 response.

“These are highly-experienced, strong additions to our team,” Jarrard said. “Jason’s background helping healthcare clients identify new avenues of opportunity and strategic growth dovetail perfectly with the goals for our firm as we ourselves evolve and grow. Abby’s track record in helping provider organizations navigate the historically difficult imperatives of the past two years demonstrates her creativity, nimbleness and shared commitment to our mission to make healthcare better.”

In addition to Poteet and McNeil, the number and breadth of the new hires reflects an increasing demand for long-term strategic planning and communications engagements among health services companies, hospitals and health systems.

“While most of the operational challenges borne out of the pandemic have receded, a new wave of pressure is creating uncertainty for healthcare provider organizations,” Jarrard said.

Those pressures include the end of COVID-19 relief funds, the shortage of healthcare workers and recruiting challenges, increasingly tense negotiations between payers and providers and rising costs as part of the inflation seen across the US economy.

“All of these challenges are linked, yet each one has a distinct set of features that must be addressed,” added Jarrard. “Solving for the future is very much a matter of ensuring each leg of the stool is in place operationally, and then communicating about each element of change in a way that bolsters support for the organization both internally and externally.”

Jarrard Inc.’s new team members add to the firm’s ability to be extraordinarily responsive to client needs and the rapidly shifting healthcare landscape, while also helping broaden the depth of specialist expertise available to provider clients. Additional new hires are:

Meg Crowley, senior managing advisor, Regional Practice. Crowley was most recently assistant director of communications at Duke University, where she gained a reputation for developing compelling content for diverse needs and audiences. Crowley also spent time in media relations for a public policy think tank.

Angela MacDonald, senior managing advisor, National and Academic Health Systems Practice. MacDonald is an expert in organizational integration, with a career that spans higher education, law and Catholic healthcare. Prior to joining Jarrard Inc., MacDonald served in multiple roles within the Mission Integration Department of CHRISTUS Health.

Liz Nix, senior managing advisor, National and Academic Health Systems Practice. Nix joined Jarrard Inc. from Vanderbilt University Medical Center where she served in multiple roles, most recently as a learning and development leader, but also including facilities planning and management.

Alison Panella, senior managing advisor, National and Academic Health Systems Practice. Panella focuses on internal engagement, strategy development and operational support. She achieved these skills in part during her eight years at Interactive Forums, Inc. a strategic marketing and research firm.

Hannah Boggs, senior advisor, National and Academic Health Systems Practice. Boggs brings years of experience in program management, talent acquisition, internal communications and internal assessments across healthcare and corporate entities. She came to Jarrard from Northwestern University’s Feinberg School of Medicine, where she was a program coordinator in the Department of Medical Social Sciences.

Nina Buckhalter, senior advisor, Health Services Practice. Prior to joining Jarrard Inc., Buckhalter served as a content strategist for a marketing agency serving nonprofit organizations. There, she developed effective social media and content strategies to position clients as thought leaders as they addressed core barriers to healthcare.

Katie Collins, advisor, National and Academic Health Systems Practice. Collins most recently served in various roles at Performance Health, a sports medicine and rehab company. As a member of the marketing team there, Collins spearheaded data analysis projects and provided project management and change management strategies for internal team members.

Emily Magnifico, project manager, Growth Services Team. An experienced marketer, Magnifico has an extensive background in building and optimizing project management practices. Most recently, she served as project manager for marketing and branding agency Anchour.

Luke Levenson, copywriter, Growth Services Team. Levenson brings a reporter’s eye to the nuanced writing necessary for healthcare marketing and strategic communications. He joined Jarrard from Premier Productions, where he served as a media buyer. Prior to that, he was a publicist for a major music label and freelance journalist.

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A First Quarter to Remember…Or Forget

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Note: This piece was originally published over the weekend in our Sunday newsletter. Want content like this delivered to your inbox before it hits our blog? Subscribe here.

The Big Story: UnitedHealth Posts Higher Quarterly Revenue, Raises Earnings Guidance

“The healthcare and health-insurance giant, the first industry heavyweight to report first-quarter results, posted double-digit revenue growth at both its Optum and UnitedHealth care units.”

Must be nice.

The State of Play

While insurance companies appear to be doing well, our hospitals are staring at some bleak Q1 numbers. Why? Well, consider that:

  • COVID-19 relief funds are drying up.
  • Patient volumes for many services are below pre-pandemic levels and may or may not recover in Q2.
  • Demand for staff exceeds supply. When there’s not enough staff, some patients needing care can’t get it (feeding the problem above).
  • The cost of the staff hospitals do have is through the roof and unsustainable.
  • Inflation is clocking in at 8.5 percent. That’s producing multiple ripples. Cost-conscious patients may be reluctant to spend to get the care they need – especially for preventative care. And staff pay raises are unlikely to keep up with the cost of living, making retention all the more difficult.

What to do? A traditional response by health systems to these pressures would be to cut costs through layoffs or service closures.

  • But many systems already cut services and staff deeply during the pandemic. Few today will let go of staff in such a competitive marketplace.
  • The high cost of care is a barrier to all but the most urgent patient volumes. This only becomes more acute during periods or massive inflation, when, pound for pound, everything costs more – whether ground beef or gasoline or medical equipment.

One possible source of at least partial relief is renegotiated payer contracts. We’re hearing from more provider organizations in our network that they’re considering – or undertaking – new negotiations. Payers will likely respond aggressively, and with increasing tension between the two, patients are at risk of getting caught in the middle. And that’s never good.

However, some payers are willing to come to the table in recognition that we’re all in this together and the distinction between payer and provider is merging. Where those constructive conversations can take place, it serves as an example of the wider opportunity for partnerships of all stripes – which also include joint ventures with private equity back partners, shared-service alliances with other systems or outright sales for scale and financial stability.

For health system communicators, get ready for change. Again. Here’s how to brace for it:

  • Be at the table. Find the time and the path to being part of the strategic conversations happening in your health system today, across executive leadership, operations, finance, legal and government relations.
  • Know your story. In times of stress or change, leadership teams can have multiple stories they want to tell. The perspective of communications chiefs is invaluable to helping leadership stay focused on the core messages while maintaining the agility to respond to the changing environment.
  • Be responsibly transparent. Times are still hard. Change will continue. Know that you will need to tell this difficult story and explain some hard truths to the community you serve. But it’s better that you tell the story first than letting someone else twist it for their own purposes.
  • Have coffee with a reporter. Build relationships with local media as much as you can. Reporters these days often have wide mandates and cover a lot of topics. That means the nuance inherent to big issues facing the local hospital or health system isn’t always reflected in coverage. Be a year-round resource for local business reporters who may have a byline on the story about your next payer battle.
  • Be ready for the fight. The stakes have increased, and payers are pushing hard. Provider organizations want to focus on delivering care, not arguing about money. But that, unfortunately, is necessary.
  • Keep the conversation going. Whereas payers are constantly negotiating contracts – it’s their business model – any given hospital is only doing that every few years. Ensure your team is keeping an eye on trends, communicating to stakeholders about what you’re doing as an organization and updating your playbook for the next negotiation.
  • Don’t accept a turnkey approach. Payers are working from a thick, and broadly consistent playbook. Still, every story, every negotiation, every community served looks a bit different. As payers are becoming increasingly aggressive, you need to ensure that your plan reflects your unique needs.
  • Be grounded. Bring everything back to your mission, your calling and your duty to serve.

This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.

Navigating the C-Suite: Beyond “Go Back and Write About it”

A long, 18-person office table in the middle of a conference room with floor-to-ceiling windows and light beaming through

This week we were honored to help produce a full panel discussion with four top healthcare marketing and communications leaders discussing team dynamics and navigating the C-suite. It’s a conversation around how marketing leaders and their teams can use their seat at the table to not just be scribes for their hospital or health system but to serve as strategic leaders and advisors.

The team includes:

  • Susan Alcorn, of counsel here at Jarrard who previously spent time as chief communications officer at Rochester Regional Health and Geisinger Health System
  • Beth Toal, vice president of communications and marketing at St. Luke’s Health System in Idaho
  • Michael Knecht, chief marketing and communications officer at RWJ Barnabas Health in New Jersey
  • Gayle Sweitzer, vice president of marketing and corporate communication at the University of Kansas Hospital

This conversation is a prelude to a panel discussion the group will be having on Tuesday, May 17th at the Health Care Marketing and Physician Strategy Summit (HMPS) in Salt Lake City. For more on the event, check out healthcarestrategy.com.

Be sure to listen and subscribe to the High Stakes Podcast.

Photo by Benjamin Child on Unsplash