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Hospital Marketing Severely Challenged by Staff Layoff Trend

By Stewart Gandolf, Chief Executive Officer

road hazardAs we continue to read about the growing trend in large scale hospital layoffs, it’s tough to think of the big picture as merely a period of “reduced economic activity.” Virtually every hospital marketing communications, advertising and public relations team in the nation knows about tighter budgets, scarce resources and fewer people. And they are struggling to find new ways to do more with fewer resources.

The well-known economic villains include the sluggish economy, the downtrend in provider payments and broad changes in healthcare delivery systems. What’s more, hospital marketing departments—as well as doctors, group practices and other healthcare providers—are pressed ever harder to lower expenses, increase productivity, enhance quality of care and lift patient satisfaction.

These are damn tall orders considering “the Great Recession officially ended over two years ago.”

The most recent numbers from the Bureau of Labor Statistics (BLS), cite mass layoffs (that's 50 or more employees) at 13 hospitals resulting in 1,085 initial unemployment claims. At that pace, the BLS predicts, hospital staff reductions will top 8,000 people by year-end.

Financial and economic forecasters are also gloomy.

In one look ahead, you'll want to read Stewart's insightful post about The First Step To Dealing With Our “New Normal” Is Acceptance. Further, the American Hospital Association (AHA) forecasts that hospitals would lose $41 billion from 2013 to 2021 if Medicare payments were cut by two percent. Employment cuts would be an additional 92,866 jobs in 2013, and 194,522 jobs by 2021. The median operating revenue at not-for-profit hospitals, according to Moody’s Investor Service, dropped to a low of four percent in FY 2010.

How will hospital marketing departments do more with fewer resources?

Throughout the industry, everyone has been feeling the pressure. For example, our post last week points to resources while the recession is still A Stinging, Lingering Sore Spot for Doctors and Hospitals. Although hospital marketing departments will be further challenged, their work is among the most vital in engineering new ways to attract new business. The hospital marketing, advertising and public relations team and programs are the facilities' front line in defending and contributing to the bottom line.

In our own healthcare marketing business, we’ve been active in helping hospital and healthcare providers push back against these economic headwinds, and to rethink, restructure and rebuild in this “new normal.”

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