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Health Marketing QuarterlyPublication details, including instructions forauthors and subscription information:http://www.tandfonline.com/loi/whmq20

Healthcare Professionalsand the Ethics of HealthcareMarketingKevin L Hammond a & Anthony F. Jurkus ba Assistant Professor of Marketing, The University ofTennessee at Martinb Professor of Management, Louisiana TechUniversityPublished online: 18 Oct 2008.

To cite this article: Kevin L Hammond & Anthony F. Jurkus (1994) HealthcareProfessionals and the Ethics of Healthcare Marketing, Health Marketing Quarterly,11:1-2, 9-18, DOI: 10.1300/J026v11n01_03

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Healthcare Professionals and the Ethics ,

of Healthcare Marketing Kevin L. Hammond Anthony F. Jurkus

ABSTRACT. The article explores marketing ethics considerations in the application of marketing to healthcare. While we realize that acceptance of healthcare marketing by all stakeholders is important for successful marketing, we emphasize its level of acceptance by healthcare professionals. The high levels of resistance to advertising and ofher forms of healthcare marketing by healthcare professionals has been largely based on the grounds that lhe practices are unelhi- cal. The nature of the resistance thus invites this exploration of healthcare marketing (and h e marketing concept), marketing ethics, and the acceptance (rejection) by healthcare professionals of health- care marketing.

INTRODUCTION

Events within the past twenty years have caused healthcare pro- fessionals to consider the use or increased use of marketing in operating the institutions or practices that they are a part of. While these professionals have applied some marketing concepts in the past, they have not generally considered the application to be mar- keting. In fact, according to Kotler and Clarke (1987) and Klein (1990), a state of confusion still seems to exist among healthcare professionals as to the general definition of marketing.

Kevin L. Harnmond is Assistant Professor of Marketing, The University of - Tennessee at Martin.

Anthony E Jurkus is Professor of Management at Louisiana Tech University.

Health Marketing Quarterly, Vol. 11(1/2) 1993 O 1993 by The HawoN Press, Inc. All rights reserved 9

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The application of marketing to healthcare has traditionally been resisted by healthcare professionals, claiming that healthcare mar- keting is unethical. Some of these criticisms are that marketing wastes money, marketing is intrusive, marketing is manipulative, marketing will lower the quality of healthcare, marketing will cause healthcare institutions to compete, and that marketing will create unnecessary demand for healthcare (Kotler and Clarke 1987; Mac- Stravic 1979). These views, of course, are not held by all healthcare professionals. According to Brady (1990), any situation can be described in terms of ethics if it "implies significant harm or benefit to others" (p 3). The potentially harmful effects listed above would seem to justify, according to Brady's explanation, the tendency to classify the application of marketing to healthcare as ethical or unethical.

What Is Marketing?

Marketing may be defied as "the analysis, planning, imple- mentation, and control of carefully formulated programs designed to bring about voluntary exchanges of values with target markets for the purpose of achieving organizational objectives" (Kotler and Clarke 1987, p 5). It involves identifying and designing the product around a target market and employing the four P's (product, price, placement, and promotion) of the marketing mix in developing the best tactics. Those directing marketing efforts should employ the marketing concept, which "is a customers' needs and wants orientation backed by integrated marketing effort aimed at generat- ing customer satisfaction as the key to satisfying organizational goals" (Kotler, 1984, p 22).

Yet healthcare professionals still seem uncertain as to what mar- keting is. Marketing may still be mistakenly defined by those in healthcare simply as selling, advertising and promotion or as image making, frequently affiliated in the minds of healthcare profession- als with the functions of public relations, fundraising, andfor devel- opment and generally not affiliated with the planning function (Kot- ler and Clarke 1987).

The increased use of marketing in the healthcare environment may be attributed to the landmark article of Kotler and Levy (1969)

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Kevin L. Hommond and Anthony F. Jurkus I 1

which suggested that the scope of marketing should be expanded to include not-for-profit entities. Prior to this time, marketing was largely employed in the services of business. The authors argued that "every organization performs marketing-like activities whether or not they are recognized as such" (p 11) and that the application of the marketing concept, as described above, could help any orga- nization in satisfying the needs or interests of the groups of people (or consumers) that they serve. The subsequent acceptance of the expansion of marketing by academicians has led to research in the area of marketing for not-for-profit organizations and has led to the application of marketing concepts to healthcare as well as other not-for-profit areas.

ENTER ETHICS

Within the area of healthcare, there are many strong feelings regarding marketing and ethics. Thus the healthcare sector would seem a very appropriate setting for Hunt and Vitell's (1986) positive (descriptive) model of a general theory of marketing ethics. Hunt and Vitell propose that, when an individual is faced with a problem having ethical content, the individual goes through a decision mak- ing process in evaluating an evoked set of altemative actions. Deontological evaluations (regarding the inherent rightness or wrongness of the altemative actions) and teleological evaluations (regarding consequences and applicability to various stakeholder groups) are both a part of the model in determining ethical judg- ments. The authors of the model postulate that ethical judgments and the intervening variable of intentions affect the eventual action of selecting an altemative. As urged by Robin and Reidenbach (1987). companies should be aware of their various stakeholder groups when incorporating ethics into the formulation of their mar- keting strategies.

Among the stakeholders in the healthcare sector are existing patients, physicians, the general public, third party payor groups, patients of other institutions or private physicians for which diag- nostic work is performed, and other customers, such as those using the cafeteria or individuals that donate time and money to the hospi-

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tal. Each of these different target markets will have different ex- pectations regarding their relationships with the hospital and will have different notions regarding business and marketing ethics. The attitudes of the applicable target markets are an important consider- ation for the hospital.

The Physician as Customer

Oddly, even if the physician disapproves of marketing (or what he or she defies as marketing), application of the marketing con- cept dictates that the needs and wants of the physician as customer be discovered and met in order to satisfy the customer and attain organizational goals. If, for example, the physicians affiliated with a particular hospital were determined to strongly oppose the use of advertising, application of the marketing concept would suggest that, in order to satisfy the customer group (physicians), advertising should not be used as a form of promotion. This does not preclude the use of other forms of promotion or marketing applications. The decision not to advertise was, in fact, due to the application of the marketing concept. These same physicians, if defining marketing simply as advertising or as advertising and selling, might conceiv- ably claim to reject marketing. Their true attitude, however, might be to accept the concepts and practices which stress satisfaction of the customer (which, in fact, is a keystone of the marketing concept).

The marketing of the hospital facility to the physicians is known as medical staff marketing and, if successful, can affect the hospi- tal's success in several areas, including market share, patient refer- rals, medical staff loyalty, and development of clinical strengths (Abrahamson 1988). Abrahamson points out that there are at least four characteristics of both physicians and hospital administrators which must be realized in introducing them to marketing. The char- acteristics are that they recognize ethics and professionalism to be an important part of their profession, they are generally intelligent and well educated, they are usually highly motivated by causes, and they generally lack training, experience, and interest in marketing. These characteristics are true of the medical staff leaders and ad- ministrators within the hospital who must be trained to help lead the marketing effort as well as the physicians who represent the target

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~ h i n L. Hammond and Anthony F. Jurkus 13

market. And the keys to success in medical staff marketing are trust, open communications, and mutual value (synergism) between the hospital leaders and the medical staff.

The position of the physician as a customer of a particular hospi- tal may also impact marketing decisions regarding elements of the marketing mix and the hospital marketing strategy. The degree to which physicians impact the patient's hospital selection decision can vary with many factors, including severity of illness and the geographic location of the hospital. If the physician is especially influential, then medical staff marketing programs geared toward improving communications become very important as tools of promotion. The programs might include perquisites such as physi- cian referral services or assistance in establishing new practices. For hospitals whose patients do not consult physicians as much regarding hospital selection, consumer advertising may be a more likely method of promotion, and medical staff marketing may be less important (Droste 1987; Powills 1986).

Theoretical Grounds for Physicians' Rejection of Advertising

The opposition of physicians to marketing seems to have cen- tered on their attitudes toward advertising. Two opposing theoreti- cal views of the effects of advertising have been presented in the literature, one described as optimistic and the other described as pessimistic (Folland, Parameswaran, and Darling 1989).

Proponents of the first view argue that advertising provides in- formation to the consumer, lowering search costs (which are a part of the overall cost to the consumer of the product) and increasing the consumer's knowledge of substitutes. The result is an increase in the price elasticity of demand which may offset the costs of advertising enough to result in lower average prices for the consum- er. This view, which is supported by several studies, is the one held by the Federal Trade Commission and the Supreme Court, leading to rulings against the American Medical Association. Favorable arguments for advertising are that advertising makes consumers more sensitive to product characteristics, thereby increasing prod- uct quality and that advertising is more beneficial for higher quality products because of greater repeat business than lower quality prod-

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ucts enjoy. The combination of these two characteristics, if this viewpoint is followed, would result in the perception that higher levels of advertising are an indication of higher quality.

Proponents of the approving view argue that advertising is mainly persuasive, attempting to increase brand loyalty by causing a change in the tastes or perceptions of consumers. By this view, the brand loyalty would cause a decrease in the price elasticity of demand, which would result in a higher average level of prices. Regarding quality, some studies "have shown that when consumer perceptions are slow to change, low quality products may be among the most heavily advertised" (Folland, Parameswaran, and Darling 1989).

Summarizing the two viewpoints: the optimistic view holds that advertising can lead to lower cost and higher quality for the con- sumer and the pessimistic view is the opposite, theorizing higher cost and lower quality for the consumer. Most physicians seem to align themselves with the second viewpoint.

One study of physicians' attitudes toward advertising indicated that their favorability toward advertising (beliefs about the useful- ness of the information provided and the effects on the image of the profession) influenced the advertising behavior of the physicians more strongly than the other factors studied. The other factors in- cluded in the study were 'perception regarding personal benefit of advertising, a measure of general outcomes of advertising (includ- ing advertising's perceived effects on price and quality), and atti- tudes toward the effects of advertising on price and level of com- petition. The results of this study indicate a significant relationship between physician's age and the alignment with the pessimistic view of advertising, helping to explain the historic opposition of physicians to advertising and, perhaps, opposition to other forms of marketing as well. Advertising, generally, is viewed as having little informational value and as having no benefits for the consumer. Attitudes of older physicians toward the personal benefits of adver- tising were also found to be more negative than the views of youn- ger physicians.

Other studies of healthcare advertising and marketing have found similarly negative views. A group of two thousand physicians indi- cated through one study that they generally did not consider advertis- ing to have a significant impact on the medical marketplace but that

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Kevin L. Hammond and Anthony F. Jurkus 15

advertising "would damage the profession's public image, plus pro- mote hucksterism and fraud" (Allen, Wright, and Raho 1985, p 48). A study of consumers' and psychiatrists' attitudes toward advertising showed a split based on age and showed an opposition by the physi- cians but a favorable attitude toward advertising by the consumers (Hite, Bellizi, and Andrus 1988). Some researchers have concluded that physicians could benefit (by modifying their behavior accord- ingly) from marketing studies evaluating consumers' perceptions of the physicians. Studies such as these demonstrate that applications of marketing to healthcare are not restricted simply to advertising and other forms of promotion (Lovdal and Pearson 1989).

SUMMARY AND CONCLUSIONS

I Marketing is definitely a part of the healthcare business today. In

'spite of opposition from physicians and other health-care profes- sionals, marketing is offered as one of the possible solutions to the problems faced by healthcare.

A major problem faced by those attempting to expand healthcare marketing in healthcare organizations is to gain acceptance of the idea by the healthcare professionals. Given the apparent lack of knowledge and interest among healthcare professionals as to what

. marketing is and how it could be applied to healthcare, the opposi- tion is understandable. The generally held view of healthcare pro- fessionals is that healthcare advertising is unethical. This view to- ward advertising could very conceivably be applied by the professional to healthcare marketing in general, especially if the professional is unclear as to the definition of marketing. Opportuni- ties for miscommunication and differences of opinion definitely exist between the healthcare professional and the professional marketer.

One solution to the problem of gaining acceptance of marketing is to sell the professionals on the positive viewpoint, explaining how the activities will be conducted and what benefits may be expected. An additional, more basic part of that solution would be to kducate the healthcare professionais (including those responsible for the marketing functions in organizations, if necessary) as to what marketing &. Marketing involves careful identification of a

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target market and a determination of the most effective application of all four components of the marketing mix toward achieving organizational goals. The marketing concept should be applied as a central part of all marketing efforts. Hiring of individuals into healthcare marketing functions who have marketing experience and/or education also helps to educate the healthcare community as to the definition and application of marketing. Healthcare adrninis- tration programs at universities are including marketing to a greater degree in their coursework; it would seem that other healthcare professionals could benefit from marketing and other business courses, as a part of their coursework, since healthcare is now recognized as a business.

The opposition of healthcare professionals regarding the ethics of marketing should serve as a waming to those instituting or expand- ing healthcare marketing programs. Attention to ethics by the stake- holders would seem especially strong in the healthcare business. Yet, a better understanding of marketing should convince healthcare professionals that marketing, and every other human endeavor, may be thought of as occupying an ethical continuum. A particular mar- keting practice may be judged as good or bad, just as a particular medical practice may be judged as good or bad. Marketing, per se, is not unethical. The marketing concept with its emphasis on deter- mining needs and providing the desired outcomes for each consum- er/stakeholder would seem to piesent an ethical imperative that cannot be denied. It is time for the healthcare professional to recog- nize this imperative. The healthcare process is far too important to deny one of the most effective concepts ever devised for the satis- faction of human needs.

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Allen, Bruce H., Richard A. Wright and Louis A. Raho (1985), "Special Section: Physicians and Advertising-Physicians Views of Advertising," Journal of Health Care Marketing, 5 (4). 39-49.

Brady, F. Neil (1990). Ethical Managing: Rules and Results. New York: Macmil- Ian Publishing Company.

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Folland, Sherman, Ravi Parameswaran, and John Darling (1989). "On the Nature of Physicians' Opposition to Advertising," Journal of Advertising, 18 (I), 4-12.

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