A recent article in The New York Times by reporter Elisabeth Rosenthal raised questions about the way hospitals put together advertising related to the latest U.S. News & World Report “Best Hospitals” ranking. The Times article is a bit of a confusing knot, mixing together questions about the trustworthiness of hospital rankings, the appropriateness of advertising of rankings, and the appropriateness of hospital advertising in general, which are really three separate issues.
In terms of advertising around the rankings, I agree with Rosenthal and some of the sources she quotes that it can be problematic, in part because it’s easy to use ranking information in a misleading way, and also because it raises at least perceived conflict-of-interest risks for rankers, who charge good money for the privilege of advertising associated with the rankings. The article suggests some of the advertising claims are abusive with the truth, and notes that health care ads are poorly regulated. I think those are plausible claims.
But the article goes on to criticize the fortune spent on hospital advertising—and not just advertising specifically around the rankings—as not returning much value to patients in an era where we are all staggering under health care costs and badly need to trim waste and make hospitals more efficient. To quote from the article:
For American hospitals large and small, it clearly pays to advertise, particularly in these tough economic times and with the Affordable Care Act poised to throw tens of millions of newly insured patients into the market. But for patients the rankings and, especially, the subsequent promotions generally have limited benefit, experts say….If such advertising often adds little in the way of useful information, it certainly adds to health care costs. Hospitals with more than 400 beds spent an average of $2.18 million on advertising in 2010, surveys have found. “We’re pushing $3 trillion in health expenditures, and one-third of that is waste,” said Dr. Eric Topol, chief academic officer at Scripps Health in California. “Those TV commercials saying ‘I got my cancer care at X hospital’ are a shame, definitely wasteful.”
I understand Dr. Topol’s skepticism. But one problem with this line of thinking is that advertising in any industry sector is rarely claimed by anyone to be a source of highly useful, top quality, trustworthy information for potential customers. It’s meant to influence potential customers by raising their awareness of the hospital’s claimed strengths, and by helping to establish positive associations with the hospital. It probably is a source of good, helpful information in many situations, but I don’t think most people see that as the main point of advertising.
Since, as the article notes, “it clearly pays to advertise,” it’s obvious that a hospital that doesn’t advertise would be at some disadvantage compared to others, presumably meaning it would get fewer patients, take in less revenue, and have to reduce its budgets—probably by a lot more than the cost of the advertising itself, since no one would advertise if there weren’t a belief that it brings in more than it costs. Many hospitals are hard-pressed as it is to invest in the people and tools they need to provide high-quality, safe care, and a lowered budget wouldn’t help. Some hospitals barely stay afloat at all. In other words, hospitals practically have to advertise, just to not lose ground in ways that absolutely could hurt patients. In that sense, advertising does return value to patients.
Of course, if every hospital in the U.S. agreed to stop advertising altogether, or to severely limit it by some formula, then in theory the advertising money saved by the entire health care industry could be channeled to better patient care. But aside from the fact that this sort of drastic and even bizarre move is hugely unlikely, it would probably carry all sort of unintended consequences relating to what hospitals would do in advertising’s place to ensure they got their fair share of patients.
Actually, though, I think there’s a bigger underlying question here that the article is sort of dancing around but never quite articulates: Should hospitals act like other businesses? Should they be aggressively marketing their services, and trying to find ways to raise their profit margins to fund improvements and the acquisition of new technology? Aren’t these sorts of pure business behaviors and goals at odds with the mission of trying to improve patients’ and communities’ health and saving lives?
I think the answer is: No, hospitals shouldn’t be exactly like other businesses. But they can be almost like other businesses in most ways, and can do an even better job in fulfilling their health-related mission as a result of it. Indeed, not running a hospital like a business invites a whole new set of potentially serious negative implications for patients.
But that’s a topic for another post.
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