Issue link: https://beckershealthcare.uberflip.com/i/821337
18 CFO / FINANCE Minnesota 'Underdog' Hospital System Mocks 'Bad Billing' in Branding Campaign By Brooke Murphy W ho doesn't love receiving unex- pected medical bills? North Me- morial Health Care in Robbins- dale, Minn., mixes a healthy dose of sarcasm and dry humor in its tongue-in-cheek brand- ing campaign that debuted April 4, Minneap- olis/St. Paul Business Journal reports. e multimillion-dollar branding campaign, created by New York City-based BrandFire, plays to Americans' various frustrations with the healthcare system, from long wait times to opaque hospital billing practices. "Healthcare is viewed by the public as bro- ken," North Memorial CEO Kevin Croston, MD, told Minneapolis/St. Paul Business Jour- nal. "We wanted to let people know [North Memorial is] different — we understand and we're working to make it better." e campaign features patients sarcastically praising irritating aspects of their healthcare experience, saying phrases like, "I love not knowing exactly how much my visit is going to cost — it makes healthcare so exciting," and, "I love being uninformed and totally uninvolved with my healthcare — it really makes me feel empowered." e campaign includes TV commercials, ra- dio spots, billboards and online ads. In the billboards and print ads, North Memorial portrays its brand as alleviating these frustra- tions by crossing out some words and replac- ing them with others. For instance, one print ad reads, "e doctor will see you aer you read an old issue of Fish- ing Life and you wonder if they forgot about you aer sitting in your undies for 25 minutes." A red slash crosses out the end of the sentence, beginning on the word "aer," changing the sen- tence to read, "e doctor will see you now." Dr. Croston said the campaign appeals to North Memorial's spirit as the healthcare underdog in a market that has undergone substantial consol- idation. "e other guys have all merged and we're the survivors. We're providing value and I think playing a vital role," Dr. Croston told Min- neapolis/St. Paul Business Journal. n Quorum Health Continues Divestiture Spree With Sale of Alabama Hospital By Ayla Ellison B rentwood, Tenn.-based Quorum Health Corp. sold 60-bed Cherokee Medical Center in Centre, Ala., to NNZ Holdings in Sunrise, Fla., at the end of March. The 35-hospital system, which is a spinoff of Frank- lin, Tenn.-based Community Health Systems, is fo- cused on restructuring its portfolio to improve its financial performance. Cherokee Medical Center was the third hospital the company divested within a few months. In De- cember, the company finalized the sale of Barrow Regional Medical Center in Winder, Ga., and Sand- hills Regional Medical Center in Hamlet, N.C. Quorum plans to sell more hospitals in the coming months. On March 30, Quorum inked a definitive agreement to sell 231-bed Trinity Hospital of Au- gusta (Ga.) to The Richmond County Hospital Au- thority. That transaction is expected to close by the end of June. The company expects to enter into a definitive agreement for the sale of another hos- pital by the end of the first quarter and has signed letters of intent covering four additional hospitals, Quorum President and CEO Thomas D. Miller said in an earnings statement released March 29. Quorum ended 2016 with a net loss of $347.7 mil- lion, compared to a net income of $1.3 million in the year prior. n SSM Health's Operating Income Tumbles After Acquisition By Ayla Ellison S SM Health, a nonprofit 20-hospital system based in St. Louis, saw revenue increase in 2016, but higher expenses due to the acquisition of Saint Louis University Hospital dragged down SSM's operating income. According to bondholder documents released in March, SSM Health saw an 11.9 percent year-over-year increase in revenues. The system said revenues climbed to $6.1 billion in 2016, of which $299 million was attributable to its acquisition of Saint Louis Uni- versity Hospital, which is now named SSM Health Saint Louis Uni- versity Hospital. St. Louis University acquired 365-bed SLU Hospital from Dal- las-based Tenet Healthcare in 2015 and then transferred the hospital to SSM Health in exchange for a minority interest in SSM Health St. Louis. Although SLU Hospital contributed to SSM's revenue boost in 2016, the hospital cost the system more than it earned. Last year, SSM Health's expenses increased 16.6 percent to $6.1 billion, of which $336.7 million was attributable to SLU Hospital. SSM ended 2016 with operating income of $10 million, down 86.8 percent from operating income of $229.7 million in the year prior. The system recorded an operating margin of 0.2 percent in 2016, compared to an operating margin of 4.2 percent in 2015. SSM said it is trying to increase its operating margin through cost re- duction programs, revenue cycle improvements and integration and optimization of its acquisitions. After factoring in nonoperating gains, SSM ended 2016 with net in- come of $99.4 million, down from $106.8 million in the year prior. n