The Major Reasons Why Marketing Increases Health Care Costs

Across every industry – from the truly glamorous to the totally mundane – marketing firms and experts work tirelessly to convince shoppers to become clients and customers.

Traveling abroad, you’ll quickly realize just how different the price of healthcare in the US is compared to every other country. Whether you’re shopping for a bit of foreign dental work or buying temporary health insurance in a country you’re visiting, the savings are astonishing.

As it turns out, marketing has a huge impact on the cost of healthcare: both in direct terms and indirect terms. We asked a master in marketing online student how marketing makes healthcare so god-awful expensive in the United States; here’s what he told us.

The Sheer Cost of Competition

Most countries either offer single-payer systems or severely limit the number of private solutions – and therefore competitors – available to the public. While the quality of care doesn’t take a hit under most of these models, the amount of marketing does.

US healthcare insurance companies spent several billion last year on marketing alone. This doesn’t include the pharmaceutical and healthcare sectors, which spent a total $10 billion over the same period.

These companies pitch their insurance offerings and medical offerings to public and private medical institutions in a big way.

From radio and television to print and direct mail campaigns, it is estimated that this form of marketing alone adds millions to the cost of healthcare in the US. New England College recently released a report on the consequences of marketing in healthcare, detailing how even in this sector, marketing is largely becoming a digital affair.

“Ask Your Doctor If…”

US healthcare regulations – particularly in the world of marketing – are far laxer than in some countries. Not only is there an unlimited amount of marketing potential available to these companies, but there are no limits on who they can market their products to.

We’ve all likely seen at least one commercial where the pitch wraps up with something along the lines of “ask your doctor if [pill/medicine] is right for you”. Only two countries allow this kind of direct-to-consumer advertising: New Zealand and the United States.

It doesn’t stop there, though. Insurance and pharmaceutical companies market their products directly to doctors. From tons of free branded swag to boxes filled with samples, these companies push themselves on doctors’ offices and hospitals with a never-ending supply of marketing material.

This creates situations where select doctors are more familiar with specific branded drugs than other comparable solutions and helps further enforce the feedback loop of pushing consumer prices higher. This happens not just because “the more one gets out of marketing, the more they’ll spend” but because drug companies – once established among doctors – know they can increase their prices disproportionately.

From viral marketing firms to online MSM degree courses, there is a huge demand for marketing across all sectors. In the healthcare sector, however – which is the largest sector of the economy – marketing is having an adverse effect on the price of healthcare. In both direct and indirect ways, US healthcare marketing is increasing costs without improving overall quality. As time goes on, more and more people will likely question whether such levels of marketing are ideal, or even necessary.

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