San Diego Reader

Many of us watched the Chargers’ season-ending run this past winter and, amid the cheers and groans, saw a 30-second TV ad starring LaDainian Tomlinson. Well-dressed and calm, he’s holding a postgame news conference.

A reporter asks, “L.T., what got you the win today?”

“There’s three things you got to have to be successful,” L.T. says. “There’s planning, teamwork, and constant communication.”

Cut to designers huddling over architectural plans.

“What’s the key to team success?”

“Well, you got to start with the right foundation. That’ll get you through the season and beyond.”

Cut to hard hats pointing at blueprints and standing before a giant pit and an earthmover hoisting a shovelful of dirt.

“So, L.T., what do you see looking forward?”

“Great things are happening.

You just got to execute the plan.”

Out pops L.T.’s million-dollar smile, and a companion glint flickers off his diamond ear stud.

Cut to a graphic artist’s computer rendering of a giant new building.

An athlete putting his name on stuff is hardly surprising. What is surprising is where the ad ends. The heraldic music rises to a crescendo to deliver the last five-second punch: “Palomar Pomerado Health. Specializing in You.”

A hospital? Not a car or jewelry or shoes or Viagra or ESPN’s SportsCenter. But a hospital. Why does a hospital have to advertise?

When I phoned Don Stanziano, public relations director for Scripps Health, and asked that question, he turned it back on me: Why wouldn’t we? As in, doesn’t everybody? As in, the only way to distinguish your product and service (as well as your brand) in the competitive health-care world is to aggressively market what you have and who you are. Who would know we exist if we didn’t advertise?

The short answer to why hospitals must market is roads. Gone are the days when a hospital served only its immediate geographical area. Now, freeway-linked, a person living in Rancho Bernardo does not feel obliged to go to Palomar hospital in Escondido but can shoot across Highway 56 to a heart program at Scripps Green on the coast. Facing knee-replacement surgery — as expensive as it is painful — the smart patient goes hunting. Some insurance providers allow her to shop for nonemergent care, and shop she will, getting second and third opinions, seeking the most competent doc and one with whom she’s most comfortable. For choosy consumers, it’s a feast of movable options.

To attract the choosy, hospitals must market. To survive in the competitive health-care field, they must fill their beds, which means selling their services, which means branding their names with catchphrases and slogans. UCSD: “The Power of Academic Medicine.” In addition, hospitals are held captive by health-care consumers’ expectations. Reacting to the publicity new hospital programs generate in the media, San Diegans want what they believe is already available elsewhere. We should have the new prostate-cancer treatment that New Yorkers have. What’s more, consumers require that their health system offer fast, accessible, topflight care, no matter the ailment, no matter the cost.

Because health care also seeks the elective-surgery crowd, it must finance fancier offerings and charge customers extra. When I was young, a hospital was a place where the sick lay bedridden amid the drab purgatory of beige walls and industrial views. These days the hospital is (sold as) a homey institution, located on a campus, sporting a park and work-out track. The contemporary medical center may include the resort’s fitness room, the spa’s Jacuzzi, and the luxury suite’s state-of-the-art TV, video conferencing, toilets for the disabled, and beds whose built-in computers monitor the patients’ vital signs.

Catering to our expectations and keeping pace with their competitors, hospitals now and those planned for the future, specialty clinics and cancer programs, weight-loss centers and robotic-surgery units are all muscling themselves into our consciousness, marketing the likes of LaDainian Tomlinson as well as patient video testimonials. If you haven’t noticed the extent to which hospitals are slipping slick radio ads into your drive time and infomercials onto your late-night TV, then you’ve been hunkered down in the backcountry far too long.

San Diego’s Big Four

Along with Palomar Pomerado Health, San Diego’s big hospital systems are Sharp HealthCare, Scripps Health, and UCSD Medical Center. But note: these systems have two or more hospitals, medical groups, and specialty clinics. Two, Sharp and Scripps, are comparable in size, budget, and market share, each having about a quarter share of the market. Together, these four serve 66 percent of San Diegans and their medical needs.

At Sharp HealthCare, there are four acute-care hospitals, three specialty hospitals (among them Mary Birch Hospital for Women, which sets the annual California record for births), two affiliated medical groups, three skilled nursing facilities, 2600 affiliated physicians, and more than 14,000 employees. Sharp is the largest private employer in the county. Most San Diegans know Sharp Chula Vista, Sharp Coronado, Sharp Memorial, and Sharp Grossmont, the largest with 481 beds. The Sharp Health Plan has 45,000 members, one of which is the City of San Diego.

Scripps Health has five acute-care hospital campuses, ten Scripps Clinic locations, and nine Scripps Coastal Medical Center locations. The Scripps Mercy trauma center, located in Hillcrest, is placed south of I-8, where almost half of the county’s trauma occurs. Scripps employs 12,000 and has 2600 affiliated physicians.

The Palomar Pomerado system comprises Pomerado Hospital with 107 beds in Poway and Palomar Medical Center with 319 beds in Escondido; there are also outpatient centers and satellite sites, like the PPH expresscare clinics operating inside Albertsons in Rancho Peñasquitos and Escondido. Palomar Pomerado employs 3700 and has 700 doctors. The service area for Palomar Pomerado is 800 square miles, much of it in the county’s sparsely populated backcountry.

Finally, UC San Diego Medical Center includes schools of medicine and pharmacy on the University of California campus as well as two hospitals, whose employees total 5200. One medical center, Thornton Hospital, is on the UCSD campus, and the other is in Hillcrest. Both are served by one faculty medical group, some 800 physicians, most of whom practice, focus on research, and teach at the medical school. There are a few primary-care and specialty clinics, like the Eating Disorders Clinic, the Shiley Eye Center, and the Moores Cancer Center.

Inpatient discharge data, compiled by the California Office of Statewide Health Planning and Development, is used to measure market share among hospitals. As one marketer told me, “We watch it like hawks.” In 2007, Sharp applied for — and won — the Malcolm Baldrige National Quality Award, given by the president to recognize “performance excellence” in health care, education, and business management. In the application, Sharp reported comparative market shares for San Diego health systems. As of 2005, Sharp had the largest market share at 27.27 percent, followed by Scripps at 22.18, Palomar Pomerado at 10.68, UCSD at 6.51, and all others at nearly 34, including Kaiser at 9.62 percent. Kaiser is a member-based health-care organization that has almost 3.3 million subscribers in Southern California as well as 22 hospitals, clinics, and medical offices in San Diego County.

Compared to the thousands of doctors and nurses and administrative staff, the marketing and communications staff in each health system is small, at best, a few dozen employees. Marketing, as defined by the American Marketing Association, is an activity that creates, communicates, delivers, and exchanges “offerings that have value for customers, clients, partners, and society at large.” The four marketing departments focus their “offerings” on advertising, web design and operations, customer strategy, media relations, multicultural relations, physician liaison, and more. Not counting call-center personnel, Sharp employs 55 people, 15 of whom design and run its website as well as produce its videos, perhaps the biggest new thing in hospital marketing. Scripps marketing has 51 employees, Palomar Pomerado has 11 full- and part-time people, and UCSD has 20 employees. Their marketing budgets are also small, in the range of $1 to $2 million, much less than the usual 3 to 5 percent of profits spent on marketing at multibillion-dollar companies such as Budweiser and Home Depot.

Revenues of the four health-care systems are huge, ranging from $1 billion to over $2 billion annually. All profits from any not-for-profit hospital are reinvested. None of it goes to award shareholders, owners, and executives as it does at for-profit hospital chains. The three largest hospital systems are defined as not-for-profit corporations. Only Palomar Pomerado is a nonprofit community hospital with a publicly elected board, financed through taxes, bond issues, patient revenues, and donations. The not-for-profits are self-supporting: patient revenues, foundations, and donations from estates and annual parties or balls sustain them. They must, as one marketer told me, “attract a favorable payor mix.” Payor money comes from patients, insurance companies, and Medi-Cal and Medicare reimbursement and has to compensate hospitals for those they serve who can’t pay.

Tomlinson Scores Big with Palomar Pomerado

The guy who signed up L.T. with Palomar Pomerado is Gustavo Friederichsen. He’s also the marketing guru behind the system’s “Hospital of the Future,” coming to Escondido in 2011. The 50ish Latino possesses abundant energy, talks inveterately, and is, in his words, “involved with everything.” Before he got to Palomar Pomerado in 2004 as chief marketing and communications officer, he was the marketing head at Scripps and Sharp, five years at each.

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