Healthcare organizations are merging or being acquired at a dizzying pace. In the second installment of this new feature, which will run in every issue of HPRMN, we take a look at a recent merger or acquisition and explore how the PR and marketing departments fared and what challenges lie ahead.
Who: St. Agnes Hospital (White Plains, N.Y.) and Our Lady of Mercy Healthcare System (The Bronx, N.Y.)
When: August 29, 1996 (effective)
Total Employees: 3,200 (900-St. Agnes/ 2,300-Our Lady of Mercy)
Effect on PR/Marketing: The PR/Marketing departments of both organizations were too lean to cut from, but the responsibilities of existing staff (primarily six people) were expanded to promote and market the newly created three-system unit: St. Agnes Hospital (White Plains), Our Lady of Mercy Medical Center and Our Lady of Mercy Healthcare System's Florence D'Urso Pavilion in the Bronx. On the St. Agnes side, Mary de Barros, who previously ran a one-woman marketing ship before the merger, has switched into a more PR-focused role for the whole system. Now most of St. Agnes' marketing is being handled out of Our Lady of Mercy with Paul Pickard, director of marketing/public affairs, at the helm.
Merger Campaign: Before the merger, St. Agnes' advertising was pretty quiet and although they had strong name recognition for quality care in Westchester County, its specialties like geriatrics, pediatrics and orthopedics suffered low awareness. New marketing messages will emphasize St. Agnes' specialties and will promote the expanded services of the new system later this year. Currently, the advertising features all three hospitals and is running in the area's five local papers, three cable channels and five radio stations. Later this year, direct mail might be added.
On the PR side, de Barros' media relations push focuses on how the merger has strengthened St. Agnes' ability to provide quality community healthcare (regardless of ability to pay) and most recently, raising awareness for the new cancer center. Key messages reiterating St. Agnes' strong allegiance to the service missions of the Catholic Healthcare Network and the Archdiocese of New York, have also been a PR priority. Promotional events like health fairs and golf fundraisers continue to provide strong community image reinforcement.
For the first half of 1997, the merger campaign was $200,000; the budget for the remainder of the year has not been determined.
Merger PR/Marketing Challenges:
- Initially, St. Agnes employees were concerned that they were being taken over by Our Lady and that their identity would be swallowed up by the merger.
- During the merger process, rumors of potential St. Agnes layoffs projected a pessimistic employee/consumer image for the hospital.
- "The new system is still on a steep learning curve in identifying which key services should be marketed to the Westchester community," says Pickard, "The Westchester community is still undefined at this point."
- Since New York advertising rates are extremely high (newspapers and cable), achieving adequate and competitive reach in the market is difficult.
Third Party Merger Advice: The St. Agnes-Our Lady of Mercy Healthcare merger was a smart and necessary business move, according to Jay Coburn, vice president of The Greeley Company, a Marblehead, Mass.-based firm that specializes in providing educational programs and consulting services to healthcare leaders. To get on equal footing with the other major healthcare provider in the Bronx market, Montefiore Medical Center, Our Lady needed to expand its market share with the St. Agnes merger. From a marketing standpoint, it is important that the newly merged system emphasize the convenience of services as well as carving out what its specialty niches will be as soon as possible. Coburn also emphasizes the importance of projecting a united medical staff image to the community. (Our Lady of Mercy Healthcare System, 718/920-1730; St. Agnes Hospital, 914/681-4500; Greeley, 800/801-6661)