Service Quality and Cost of Care as Preferred Strategies for Patient Satisfaction and Loyalty: The Mediating Role of Brand Image and Perceived Value in Healthcare Services

Abstract

Satisfying patients and gaining their loyalty has equal importance in a healthcare setup as that of the clinical outcome. However, patient satisfaction is closely associated with service quality, and financial considerations have gained prominence in defining the perceived value and value creation not only in strategy literature but also in healthcare. This study explores the effects of service quality and cost of care on patient satisfaction in defining the perceived value and brand image and creating loyalty in Pakistan’s hospital sector, as both the direct association and mediators. A non-probability convenience sampling method was used, with a sample size of 180 patients, using a cross-sectional, quantitative design in private and public hospitals in Karachi City. The findings reveal that the cost of care significantly influences patient satisfaction and perceived value, both of which improve patient loyalty. While service quality positively shapes brand image, its influence was not found to be significant, yet it contributes to loyalty. These results reflect the critical role of affordability and perceived value in shaping patient experiences. The study highlights that healthcare organizations must balance quality with cost efficiency by ensuring transparent pricing and effective service delivery. Moreover, the integration of patient-centered strategies and digital health solutions can further reinforce satisfaction and loyalty, enabling hospitals to develop a sustainable pathway to improving patient relationships and competitive positioning.