Health systems getting into the fitness business might seem like one of two things: a luxury or a losing proposition. But there’s also a third. A good business move. According to the World Fitness Association’s recent study, health systems have seen 7 percent revenues in excess of expenses.
But it’s not just about opening a fitness center. Athletes aren’t a big enough segment to justify the outlay. Success comes from smart spending and a wide array of programs to reach people who will pick up a dumbbell, followed by constant outreach. More than the cash influx, the move is a growing necessity to stay competitive in a tight market, says Alex Lincoln, senior vice president of strategic development at EXOS.
And when it’s done and done well, health systems have experienced five benefits that build their presence and get their practitioners known to patients and the community well before an injury or sickness happens.
1. Acquiring new patients.
For some people, the fitness center will just be a fitness center, which is a needed revenue stream. And for them, there are fitness-specific programs to offer, such as proper training techniques and injury prevention. But successful companies also offer a variety of other positive, proactive entry points, such as community health expos, after-school obesity programs, and sleep hygiene classes. “You don’t have to wait until people get ill,” Lincoln says.
By getting out in front early, the health system will become a resource for the entire health process, from exercise to injury prevention to surgery and rehab, for example. Once that image is set, it’s easier and more desirable for people to keep their care in one place.
2. Keeping those patients in the system.
Getting people into the health system is a good first step, but the ultimate goal is to offer more comprehensive care. This can be achieved by having dietitians talking to primary care physicians and trainers talking to surgeons, for example. The benefit: More relevant information about patients gets shared. To make it work, you need to invest in online tools and systems and employ asset managers who oversee the chain and can walk a patient through the entire process. The return is that people won’t get lost in a vast system, and when they stay in, so do their dollars.
3. Staying competitive in the marketplace.
Athletes and fitness-related programs alone can’t sustain a health system’s business model, and with health care funding becoming more restrictive, health systems need to offer more community benefits to maintain their non-profit status. The range of programs offered fulfill that requirement. Plus, you’re keeping people out of the hospital. While there will always be medical problems, the health system has more leverage when getting paid and reimbursed by keeping people healthy and at work.
4. Being more efficient with your money.
The key to making money is for the fitness center to be a presence, and it doesn’t have to be (and shouldn’t be) large to do that. A smaller footprint — 2,500 to 5,000 square feet is optimal — requires less capital upfront, making it a smaller hit to a health system’s overall budget. Once it’s operating, the normal daily downtimes become less of a concern. And because a range of programs are being offered, the space has multiple ways to be used, bring in revenue, and establish the health system’s brand.
5. Increasing engagement with patients.
Attracting and keeping people in your health system isn’t unlike what happens in corporate wellness programs. Through a combination of in-person evaluations and online surveys, success lies in health professionals learning about what a person needs, whether it’s better training techniques or more energy for work. Then web-based programs can be created and regularly sent out, outlining daily regimens for things like sleeping, eating, hydration, and fitness, providing suggestions and goals to work toward. Texts can also be used to keep people who don’t go to the fitness center regularly, or at all, engaged and advised.
Again, it’s offering a continuum of care, with a caveat. Online tools help practitioners reach more people and be more efficient, but they’re just a complement. Successful health systems don’t look to replace staff. An Accenture study found that 77 percent of U.S. customers prefer dealing with a human being for advice; 52 percent have switched because of poor service; and the estimated cost of switching is $1.6 trillion. “It’s building off a connection,” Lincoln says, “not replacing it.”
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