Longevity Healthcare Systems, Inc Case Analysis

Topics: Nursing home, Centers for Medicare and Medicaid Services, Healthcare Pages: 10 (2756 words) Published: November 18, 2009

Longevity Healthcare Systems, Inc is an institution that provides services such as basic (nursing home) health care, rehabilitation therapy, Alzheimer’s care, institutional pharmacy services, sub-acute care and home health care. Longevity has four health care areas; Nursing Care, Subacute care, Rehabilitation services and Institutional pharmacy. The business emerged when Kathryn Hamilton, in 1972, was searching for a nursing home for her mother. Kathryn together with her husband leased a small, outdated 40-bed hospital in a nearby suburb and converted it into along term care facility. By 1979, Longevity was incorporated and Kathryn became the President. For the past years, they've built and acquire nursing homes and institutional pharmacies in Grand Rapids, Michigan and Toledo, Ohio.

Currently, Longevity does not have a corporate marketing strategy. Each of Longevity’s health care units (nursing care, subacute care and pharmacy) has its own marketing method and strategy and do not collaborate at any level. The only corporate marketing effort undertake by Longevity is to distribute promotional materials underlying its philosophy of care, services and quality. Direct selling to referral sources was also used to promote the pharmacy services.

As Kathryn reviewed the financial statements of Longevity, she was somehow satisfied that the sales exceeded the expectations. But she was thinking way beyond that. Currently, Longevity is looking into further expansion opportunities. The Longevity’s management has to decide the direction of the company and make a decision and which expansion opportunity to undertake. All growth opportunities will further expand Longevity’s reach, but given the limited resources and the new marketing strategy, management has to choose between these projects.

Faced with all these concerns and plans, the group has come up with the problem: What corporate marketing strategy should Longevity health care Systems, Inc adopt and implement that would match its financial resources?

Increase private pay customers by 20% in one year
Increase customer satisfaction and loyalty by 20% in one year •To increase occupancy by 20% in one year.


Longevity’s current sales and earnings exceeded expectations. •The use of various marketing tools (e.g., telemarketing, direct contact, promotional tools) to promote high occupancy and expand percentage of private pay residents. •Longevity offers a wide variety of nursing home services (e.g. room and board, dietary services, recreation and social activities, housekeeping, and laundry services and other numerous specialized services, rehabilitation therapy) •High profit margin in subacute care operations

Longevity’s prices were substantially lower for comparable services (nursing care and rehabilitation) -competitive prices of its nursing care services
Acquisition of a retail pharmacy in Grand Rapids
-which was converted into an institutional pharmacy to provide prescriptions, medical equipment and supplies and consulting services to longevity facilities

By providing a wide range of services, Longevity provides its customers with a lot of choices. There would be no need for the customers to find for another healthcare institution or nursing home that will offer them the service they wanted. The expanded services of Longevity will prove to be extremely helpful tools to promote Longevity products. It is important for Longevity to maintain all of its services and at the same time assuring the customers the quality of its care and services. Longevity’s current sales and earnings exceeded expectations which mean that Longevity has a lot of customers.


Constant profit margin on sales for the past two years since 1989 – 1993 - The net income did not increase since the return on sales has no improvement. • Longevity’s recent...
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