The following is Part III of a detailed five-part series focused on the drivers behind the branding transformations taking place in the healthcare service providers market.
Author of this series, Todd Lunsford, served as chief marketing officer and held substantial roles in strategy and change management for Envision Healthcare, and its predecessor AMSURG, for over thirteen years.
In the previous two parts of this series, we established that branding has been neglected as a key business driver in healthcare, particularly in the provider space, but that powerful forces are re-shaping the landscape for brand strategy. Part I focused on the trend toward accelerating consolidation of the healthcare services provider market, largely driven by private equity M&A investments. Part II focused on long-term shift away from pricing and compensation based on procedure volume and toward a value-based system. For a better understanding of the context for this article, please read Parts I and II first—and do stay tuned for Part IV next week!
In Part III, I’ll examine a third force: the gap between supply and demand for healthcare professionals.
The Physician Supply-Demand Gap
A recent and detailed study by the Association of American Medical Colleges reinforced a persistent issue frequently discussed in the healthcare community as a threat to quality care, namely that the demand for medical services will outstrip the supply of physicians in the decades ahead. The key chart in this study highlights a projected shortfall of between 46,900 and 121,900 physicians in the U.S. by 2032:
Drivers on the demand side include the aging of the population, with the 65+ cohort projected to grow by 48% while the under 18 cohort grows by a mere 3.5%, and an expectation of increased focus on population health goals leading to greater longevity. On the supply side, more than 2 of every 5 currently active physicians will be 65 or older within the next decade. There is also a distinct trend toward physicians of all ages working fewer hours, so both the number of physicians and the actual full-time equivalents (FTEs) of capacity those physicians represent are facing downward pressure. There is no expectation of major increases in the number of new physicians to bridge the gap.
How Providers Adapt
In the absence of any market adjustments, the gap between physician supply and demand would lead to reduced access and longer wait times. But of course, even in a highly regulated market like healthcare, and particularly one where compensation has so exclusively focused on procedure volume (as discussed in Part II), there will be adjustments and innovations in delivery models designed to bridge the gap. So we see increased adoption of:
- delegation of some care components to physician extenders—i.e. nurse practitioners, CRNAs in anesthesia, and radiology technicians—where it can be done without sacrificing clinical quality.
- exploration of artificial intelligence technology to help narrow and improve the efficiency of diagnostic processes and other clinical decision-making.
- more efficient means of communications with patients including increased online/email interaction between clinicians and patients.
- telemedicine, which eliminates the need for in-person appointments as a requirement for comprehensive physician-patient interaction.
The purpose of all these trends is not to replace physicians, but to remake clinical processes in such a manner as to keep doctors focused on the best use of their skills and improve the dialogue with patients. The same is true for nurse practitioners and other categories of highly skilled clinical specialists, where pockets of supply shortages also loom.
The Takeaway for Brand Strategy
As the market works through this reconfiguration of the care process to better utilize physician capacity, adopt promising technologies, and improve communications, attracting high quality clinicians who are adaptable and willing to operate in this new paradigm will become an even more critical factor in the growth of provider organizations. If the shortage in physician supply unfolds as expected, then basic math dictates that recruiting will become an increasingly tough challenge over time.
The end result is that healthcare provider brands will need to play a stronger role in clinical recruiting: they must be able to position progressive new approaches to clinician deployment as somehow “freeing” clinicians to care for patients better, and avoid the perception that the changes are designed to simply reduce physician autonomy. Due to the increasing size of provider organizations, the embedded skepticism in the clinician community toward “corporate medicine,” and the lack of attention paid to healthcare employer branding in the past, success in this arena is not a given. It will require serious focus and investment in a three-pronged approach that can develop a differentiated clinician employer brand story, support an effective communications strategy to get the word out, and implement the internal systems to ensure that the brand story is translated into operational reality.
The evolution of care processes and communications will also remake patient experiences, and for those organizations that execute consistently it will create even more opportunities for brand differentiation on the consumer side. We will explore that aspect in the next article in this series—Part IV: Increasing Transparency and Brand Differentiation Through Patient Experience. It will focus on the increasing power of consumers to compare healthcare providers on the dimensions of price, quality, and their overall experience, and the implication of that power for brand strategy and investment.
If this article struck a chord, it may be time for a branding Health Check from a third-party expert. At TopRight, we have partner-level resources who know healthcare, both from a marketing and clinical leadership (MD) perspective. So, let’s have a conversation. Otherwise, feel free to connect with me on LinkedIn, follow TopRight CEO Dave Sutton @toprightpartner, or if you want to go deep on transformative branding, grab a copy of Dave’s new book, Marketing, Interrupted.