Hospital Advertising, Competition, and HCAHPS: Does It Pay to Advertise?

Abstract

In competitive markets, hospitals that spend more on advertising earn higher HCAHPS ratings on global measures.

Publicly Reported Patient Satisfaction Scores in Academic Otolaryngology Departments

“…A positive correlation between a hospital's advertising spending and their customer satisfaction scores has been reported. 22 Furthermore, business reports suggest that higher PSS correlate with higher profit margins for hospitals. 23 While our study suggests that PSS metrics have limited utility to discern providers in the academic otolaryngology setting, additional studies are needed to understand the landscape and investment into PSS.…”

Characterization of US Hospital Advertising and Association With Hospital Performance, 2008-2016

“…Other studies have found that advertising by hospitals can be effective at increasing both a hospital's market share and the ratings provided by consumers. 6 In some areas, for-profit hospitals have largely been responsible for the rise in hospital advertising, which raises additional questions about the intersection between profit motive and socially beneficial advertising. 28 Although we do not find that advertising nationwide is propelled by for-profit entities, if the most financially stable hospitals advertise (rather than the highestperforming hospitals) and if consumers cannot distinguish between the competing claims, it is unclear how the substantial resources devoted to DTC hospital advertising could improve consumer choices.…”

“…[1][2][3][4] In theory, DTC advertising allows organizations to inform consumers about the breadth and quality of services they offer, increasing awareness and improving decision-making. 5,6 In practice, however, DTC advertising in health care has been found to include misleading or inaccurate statements, perhaps owing to limited oversight, raising concerns that advertising may be a mechanism for health care organizations to increase the demand for potentially unneeded services. [7][8][9][10] Hospital advertising presents a challenge for regulators who must balance the potential benefits of informing consumer choice against the need for guardrails to protect unsuspecting patients.…”

Why Do So Few Consumers Use Health Care Quality Report Cards? A Framework for Understanding the Limited Consumer Impact of Comparative Quality Information

“…Insofar as they advertise CQI, hospitals have tended to spotlight patient satisfaction scores (e.g., HCAHPS “Recommend the Hospital” score) rather than clinical quality measures, perhaps because many patients find the latter confusing (Austin et al, 2015; Latham, 2004; Rothberg et al, 2008; Zuger, 2015). Studies tend to find a positive relationship between hospitals’ HCAHPS scores and their advertising outlays, noting that the advertisements relate mainly to the amenities provided by hospitals and not clinical excellence or quality scores (Goldman, Vaiana, & Romley, 2010; Huppertz, Bowman, Bizer, Sidhu, & McVeigh, 2017; Muhlestein et al, 2013). These developments have attracted both criticism (Finn, 2001; Larson, Schwartz, Woloshin, & Welch, 2005; Schenker, Arnold, & London, 2014) and praise (Babakus & Cavusgil, 1988; Bordonaro, 2012).…”