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JOSM
20,1

Loyalty, perceived value

and relationship quality
in healthcare services

76

Miguel A. Moliner
Universitat Jaume I, Castellon de la Plana, Spain and
Departamento de Administracion de Empresas y Marketing,
Universitat Jaume I, Castellon de la Plana, Spain

Received 20 March 2007

Revised 17 February 2008,
16 May 2008
Accepted 22 September
2008

Abstract
Purpose The purpose of this paper is to justify the central role played by post-purchase perceived
value and relationship quality in the explanation of loyalty behaviour/intentions.
Design/methodology/approach The paper starts from a conceptual framework based on agency
theory. From this theoretical base the concepts of post-purchase perceived value and relationship
quality are derived. The causal model is tested on a sample of hospital users.
Findings The results show that perceived functional value exercises a significant influence over
consumer satisfaction and trust. The main antecedents of loyalty are trust and satisfaction.
Research limitations/implications The analysis has focussed on two hospitals, so the sample,
though sufficient, is restricted to two specific cases.
Practical implications The recommendation is that firms should introduce into their strategies
the concept of perceived value, overcoming a vision excessively focussed on quality.
Originality/value The paper has adapted a previous model to identify the antecedents of loyalty.
The antecedents that have been identified up to now are highly speculative.
Keywords Customer relations, Hospitals, Health services, Customer satisfaction, Patients
Paper type Research paper

Journal of Service Management

Vol. 20 No. 1, 2009
pp. 76-97
q Emerald Group Publishing Limited
1757-5818
DOI 10.1108/09564230910936869

Introduction
Consumer loyalty has become one of the principal lines of research in marketing. Some
authors consider that studies oriented towards the analysis of perceived quality and
satisfaction make sense in the framework of the explanation of purchasing loyalty,
because customer loyalty has become the principal objective of firms (Oliver, 1999). But
despite this growing interest, there is no unanimity over the definition of the concept of
loyalty, nor is it clear what its antecedents are. As Buttle and Burton (2002) point out,
the antecedents of loyalty that have been identified are highly speculative.
Authors like Singh and Sirdeshmukh (2000) have resorted to agency theory to find an
explanation of consumer loyalty behaviour/intentions. According to agency theory,
asymmetry of information and opportunism are the two key elements of the dilemmas
presented in exchanges. The notion of asymmetry of information implies that one party
to the exchange has a greater quantity and/or quality of information. The problem of
adverse selection occurs when the principals (consumers) are unable to discriminate
between the quality of different agents (service providers). This implies the
consideration that there exists a heterogeneity in the quality and in the configuration

of the products or services offered by the different agents. But this heterogeneity is not
clear to the principal because of deficiencies in his/her information.
The essential solution to the problem of adverse selection is signalling, i.e. it is in the
interest of a hospital of high-quality services to reveal to the patient (principal) private
information on its operations so that it cannot be imitated by suppliers of low quality
(investment in specific assets). Opportunism arises from the notion that the partners in
the exchange are motivated by selfishness and are likely to exploit the situation, if they
can, to favour their own interests. This causes the problem of moral risk, such that an
opportunistic agent (hospital) decides to skimp on quality in order to obtain a higher
return and to distribute a lower level of quality than that promised in the initial
contract with the principal (patient).
Singh and Sirdeshmukh (2000) identify a series of antecedents, such as investment in
specific assets, prices and post-purchase evaluations, which link directly to the most
recent studies of post-purchase perceived value. Perceived value is the essential result of
marketing activities and is a first-order element in relationship marketing (Oh, 2003;
MSI, 2004; Dumond, 2000; Peterson, 1995; Ravald and Gronroos, 1996). Perceived value
is the comparison that customer makes between the benefits and sacrifices of one or
more service suppliers (Sheth et al., 1991a, b; Sanchez et al., 2005). If the evaluation of a
supplier is positive and higher than the rest of the providers, the supplier will be selected.
Together with the antecedents of the model, Singh and Sirdeshmukh (2000) consider
that satisfaction and trust are the antecedents of loyalty. This proposal introduces us
into a new field of marketing research which in recent years has been acquiring some
importance: relationship quality. Relationship quality can be seen as a mega-construct
made up of other key components that reflect the overall nature of an exchange
relationship between two parties (Hennig-Thurau et al., 2002). Gummesson (1987)
considers relationship quality to be the quality of the interaction between a customer
and a supplier, and it can be interpreted in terms of accumulated value.
It is important to highlight the sector on which this study is focussed. The
healthcare sector in general, and the hospital sector in particular, are of prime
importance in developed economies. This importance emerges at the social level,
because the basic need that it satisfies (health) is a priority for human beings, and also
at the economic level, since they are multi-service organisations that require a large
quantity of resources and capacities.
In European countries there is a public hospital network that coexists with a private
one. The first system is funded by the State, so the patient does not pay the cost of the
service received directly, whereas in the private system this does occur. A series of
studies emphasise how important it is for healthcare institutions to pursue the loyalty
of the customer (MacStravic, 1987; Colie and Grossman, 1988; Fisk et al., 1990; Teschke,
1991; Gemme, 1997; Howard, 1999; Peltier et al., 1999, 2002; Thrall, 2001; Piper, 2005).
The existence of a public hospital system that coexists with a private hospital
system may cause the patient to doubt which type of hospital will take his interests
most into account. Some patients may think that in the private hospital the quality may
be compromised in some aspect because, unlike a public hospital, it is governed by
profitability objectives, which may lead to opportunistic behaviours by the hospital
(shorter hospitalisations, less medication, fewer staff).
The solution to the problem of moral risk is to share the risk. In this sense, price
mechanisms can serve as a device for sharing risk. While a private hospital can

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services

77

JOSM
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78

increase its prices, transferring costs to the patients, this is very difficult in a public
hospital, so there are obvious differences in these two healthcare services agents.
Loyalty is conceived from an attitudinal standpoint, i.e. the greater or lesser
predisposition to resort to a particular hospital when the need arises, because in many
countries it is not possible to change ones public hospital. Most empirical studies in
hospital marketing analyse perceived quality, satisfaction and the relationship that exists
between them (Oswald et al., 1998; Bryan et al., 1998; Deeter-Schmelz and Kennedy, 2003).
Studies focussed on customer loyalty have been based on models in which satisfaction is
the only antecedent of loyalty. For example, Fisk et al. (1990) and Piper (2005) defend the
need for hospitals to seek the satisfaction and the loyalty of the patient, just as business
firms do. Choi et al. (2004) posit a rather more complex model to explain the patients
behaviour intentions. Service quality is an antecedent of value, of satisfaction and of
intentions, while value is an antecedent of satisfaction and of the behaviour intention. The
precursors of the intention are, therefore, satisfaction, value and service quality.
Thus, the explanatory models of attitudinal loyalty used in the healthcare context do
not consider variables like trust. The aim of this paper is to justify the central role played
by post-purchase perceived value and relationship quality in the explanation of loyalty
behaviour in the context of the healthcare services offered by a hospital. For this
purpose, we start from the concepts of post-purchase perceived value and relationship
quality. We posit a causal model which is tested on a sample of hospital users.
Conceptual model
From the firms point of view, loyalty is habitually confused with repeat purchase
behaviour. However, from the conceptual point of view, repurchase is no more than a
manifestation of loyalty, together with word-of-mouth communication (Oliver, 1999).
For this reason, loyalty is conceived as an attitude or an intention that gives rise to
certain behaviours in the course of a relationship (Oliver, 1999). This approach is
supported by those situations in which the customer has no real possibility of choice,
as occurs with public services. In these cases, although repurchase behaviour does
occur, the attitude or intention may not be loyal to the supplier, though the
non-existence of alternatives prevents different behaviour.
This is the situation in the case of the European public hospital system, so it is
fundamental to study loyalty from the point of view of attitude, and more specifically,
of the degree of commitment that a patient has to his or her hospital. In this line, the
most recent literature has identified two antecedents of loyalty: perceived value and
relationship quality (Hennig-Thurau et al., 2002; Moliner et al., 2005, 2007; Sanchez
et al., 2005). The model proposed is shown in Figure 1.
Post-purchase perceived value
Perceived value is the essential result of marketing activities and is a first-order
element in relationship marketing (Oh, 2003; MSI, 2004; Dumond, 2000; Peterson, 1995;
Ravald and Gronroos, 1996). Perceived value is the comparison that the patient makes
between the benefits and sacrifices of one or more hospitals (Sheth et al., 1991a, b;
Sanchez et al., 2005).
The literature on perceived value identifies two major dimensions: functional and
affective values (Sheth et al., 1991a, b; Sweeney et al., 1996; Sweeney and Soutar, 2001;
Moliner et al., 2005; Sanchez et al., 2005). More specifically, functional or cognitive value

POSTPURCHASE
PERCEIVED VALUE

Healthcare
services

RELATIONSHIP QUALITY

Assets investment
Functional value
ofinstallations
Consumers Trust:
Honesty

Evaluation of
attributes and
characteristics of
the product/service

H2

H5

Functional value
professionalism
of personnel

79

H3

H4

H1

Consumer
Satisfaction

Functional value
perceived quality

Consumers
Commitment

H3

H2
Price

Consumers Trust:
Benevolence

Functional value
monetary costs
Functional value
non monetary costs

Source: Adapted from Singh and Sirdeshmukh (2000)

is understood as the valuation made by a consumer on comparing the cognitive benefits

received and the cognitive sacrifices made (Dodds et al., 1991; Grewal et al., 1998; Cronin
et al., 1997, 2000; Bigne et al., 2000). Five indicators of post-purchase perceived functional
value have been identified: installations, product/service quality, professionalism of
staff, economic costs and non-economic costs (Sheth et al., 1991a, b; Sweeney et al., 1996;
Sweeney and Soutar, 2001; Moliner et al., 2005; Sanchez et al., 2005).
The comparison between the model proposed by Singh and Sirdeshmukh (2000) and
the functional value proposal permit us to observe a great equivalence. The functional
value of installations is an indicator of investment in assets. The quality of the
product/service and the professionalism of the staff can be considered to be indicators
of the evaluation of the attributes and characteristics of the product/service.
The monetary and non-monetary costs are indicators of the price.
Relationship quality
Relationship quality can be seen as a mega-construct made up of other key components
that reflect the overall nature of an exchange relationship between two parties
(Hennig-Thurau et al., 2002). Gummesson (1987) considers relationship quality to be
the quality of the interaction between a customer and a supplier, and it can be
interpreted in terms of accumulated value. Other authors have defined relationship
quality as the degree of convenience that a relationship has for a customer when
satisfying his or her needs (Hennig-Thurau and Klee, 1997, p. 751).
The most recent literature agrees in identifying the components of relationship quality.
These are the satisfaction of the consumer, trust in the supplier, and commitment

Figure 1.
Perceived value and
relationship quality
according to agency
theory

JOSM
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80

(Baker et al., 1999; Crosby et al., 1990; Dorsch et al., 1998; Garbarino and Johnson, 1999;
Palmer and Bejou, 1994; Smith, 1998).
According to the disconfirmation paradigm, satisfaction is a comparison between
performance and expectations (Hunt, 1977; Oliver, 1981). But according to Oliver (1999)
this is a definition based on what the consumer does, and not on its psychological
meaning. He therefore proposes that satisfaction is defined as pleasurable fulfilment
(Oliver, 1997, 1999). That is, the patient senses that the hospital fulfils some need,
desire, goal or so forth and that this fulfilment is pleasurable. Thus, satisfaction is the
patients sense that the hospital provides outcomes against a standard of pleasure
versus displeasure.
Morgan and Hunt (1994) consider that the commitment-trust tandem is the
indivisible axis that leads to the efficiency, productivity and effectiveness of
relationships. The basis for maintaining relationships is the keeping of promises
(Gronroos, 1990), so that if a promise is not fulfilled the patient will not visit to the
hospital again, so the relationship will come to an end. Oliver (1999) considers that
loyalty is a commitment. Commitment has been defined as the highest level of
relational bond (Dwyer et al., 1987). Commitment between the parties arises when one
of them considers that his/her relationship with the other is so important that it is
worth dedicating the maximum effort to maintain it indefinitely (Dwyer et al., 1987;
Moorman et al., 1992; Morgan and Hunt, 1994; Gundlach et al., 1995). The essence of
commitment between the parties lies in adopting a long-term orientation of the
relationship, a desire to make short-term sacrifices in order to obtain long-term benefits
(Dwyer et al., 1987). As pointed out by Samuelson and Sandvik (1997) and Zins (2001),
commitment and loyalty are the same variable, so it makes no sense to use both terms
since we are talking about two sides of the same coin. This leads us to question studies
in which both concepts appear (Garbarino and Johnson, 1999; Gruen et al., 2000; Bennet
and Rundle-Thiele, 2002; Fullerton, 2003; Mattila, 2004; Ball et al., 2004).
With respect to causal relationships, the literature holds that satisfaction with the
supplier is an antecedent of the consumers commitment to it (Oliver, 1999). Satisfaction
is a comparison between the results of the different transactions carried out and prior
expectations. If as a consequence of these experiences the level of satisfaction is low, the
level of commitment to the establishment will also be low. When the patient experiences
an increase in his satisfaction with the hospital, his commitment also increases, in either
the affective or cognitive component. Hence:
H1. The patients satisfaction with a hospital directly and positively influences
the patients commitment to that hospital.
Trust implies that the good intentions of the supplier are not questioned by the
customer, that the promises made do not generate uncertainties in the purchaser, and
that the communication between the partners is honest open and frequent (Czepiel,
1990). Trust has been defined as an individuals general expectation as to whether
anothers word can be trusted (Rotter, 1967). At a general level it is accepted that a
customers trust is composed of two major dimensions: honesty (belief that the hospital
will keep its word and that it has the capacity to do so), and benevolence (belief that the
hospital is interested in the patients well-being) (Moorman et al., 1993; Morgan and
Hunt, 1994; Kumar et al., 1995; Ganesan, 1994; Doney and Cannon, 1997; Ganesan and
Hess, 1997; Garbarino and Johnson, 1999; Singh and Sirdeshmukh, 2000).

The literature reviewed permits the hypothesis that trust is an antecedent of

commitment. The clearest justification is that of Kramer (1999), who considers that
trust reduces the transaction costs of searching for information on prices and
alternatives available in the market, of inspection and measurement of the objects
exchanged, of communication between the parties, and of legal advice. The higher the
level of patients trust, the lower the transaction costs and the greater the commitment
to the hospital. Furthermore, given that trust is the necessary basis for promises to be
believable, and since commitment is based on the keeping of promises by the hospital,
the causal relationship can be posited as follows:
H2. The patients trust in the hospital directly and positively influences the
patients commitment to that hospital.
The literature also posits that satisfaction with the relationship is an antecedent of
trust (Garbarino and Johnson, 1999; Singh and Sirdeshmukh, 2000; Delgado-Ballester
and Munuera-Aleman, 2001; Bloemer and Odekerken-Schroder, 2002; Anderson and
Srinivasan, 2003). The greater the patients satisfaction with the hospital, the more
trust generated in the patient, thus establishing a direct relationship between the two
variables. The relationship between the two variables can perhaps be best seen in the
negative aspect. If the patients level of satisfaction falls, trust will suffer:
H3. The patients satisfaction with the hospital directly and positively influences
the patients trust in that hospital.
Relationship quality and perceived value
Regarding the link between the perceived value of a purchase and the variables that
conform the relationship quality of a hospital, it has to be said that there are not many
empirical studies. Gummesson (1987) considers that the relationship quality could be
interpreted in terms of accumulated value. In the same sense, Ravald and Gronroos
(1996) consider that during the first stages of a relationship the value of each
transaction is of great importance, while in more mature stages of the relationship it is
the quality of the relationship that counts. It is accepted, therefore, that the perceived
value of a purchase is an antecedent of the relationship quality.
At the conceptual level, perceived value is a different construct from satisfaction.
The perceived value is a comparison between what a purchase has contributed of
getting and what it has involved of giving, whereas satisfaction is a comparison
between the expectation of value (before the purchase) and the perceived value (after
the purchase) (Parasuraman, 1997; Ravald and Gronroos, 1996). Then perceived value
is an antecedent of satisfaction (Oh, 1999; McDougall and Levesque, 2000; Singh and
Sirdeshmukh, 2000; Szymanski and Henard, 2001; Woodall, 2003; Durvasula et al.,
2004). This allows us to put forward H4:
H4. The perceived value of a hospital positively influences the patients
satisfaction with the hospital.
With respect to the link between the perceived value of a hospital and trust in and
commitment to the hospital, Morgan and Hunt (1994) consider that the benefits of the
relationship are precursors of trust and commitment. The perceived value of a purchase
can be considered part of the benefits of the relationship. Singh and Sirdeshmukh (2000)
consider that perceived value influences trust but does not directly influence loyalty.

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They further consider that the professionalism and service quality influence honesty,
while costs influence benevolence. This leads us to put forward the fifth hypothesis:
H5. The perceived value of a hospital directly and positively influences the
patients trust in the hospital.

82

Methodology
The basic objective of the empirical part is to test the model among users of the services
of a hospital. More specifically we chose the users of one Spanish public hospital
(Hospital de Sagunto) and one Spanish private hospital (Hospital 9 de Octubre), located
in Valencia (Spain). The selection of the sample was random, a random route in each
hospital being established for each of the interviewers. In this way, in the public hospital
we surveyed patients of 19 hospital services, while in the private hospital we evaluated
27 services, interviewing the patients who were waiting to be attended. The average
duration of the interviews was ten minutes. The population was that of individuals over
the age of 18, who had used the external and/or hospitalisation services of either of these
two hospitals at least three times during the last two years. This decision was taken
because in order to explain loyalty behaviour it is fundamental that the respondents
should have personal experience, and that it should be recent.
In the questionnaire used to measure the perceived functional value we used the
GLOVAL scale (Moliner et al., 2005; Sanchez et al., 2005), which through 16 items
measures installations, product/service quality, the professionalism of staff and
economic costs. A two-item scale has been incorporated to measure non-economic
costs, which are substantial in the healthcare sphere due to the queues and waiting lists
that occur, especially in the public system. To measure satisfaction we resorted to the
study by Bloemer and Odekerken-Schroder (2002) which uses three items.
With respect to trust, it should be said that it is the only construct that fulfils the
requisites marked out by Jarvis et al. (2003) to identify a formative construct. To
measure honesty and benevolence we resorted to the scales of Morgan and Hunt (1994),
Kumar et al. (1995), Doney and Cannon (1997) and Ganesan and Hess (1997). Honesty is
measured by means of four items while benevolence is measured on a scale of three
items. To measure commitment we resorted to the scales of Morgan and Hunt (1994)
and of Geyskens et al. (1996), which uses six items to measure the attitude to the
organisation. All the scales used in this study have been adapted to the specific
terminology of the hospital sector.
The field work was carried out in January and February 2005. Regarding the sample,
341 personal interviews were carried out, 171 in the private hospital and 170 in the public
hospital. The questionnaires were subjected to a filtering process with the aim of
identifying and eliminating atypical cases, or outliers (Uriel and Aldas, 2005). These
are cases in which one, two, or many variables take extreme values that cause them to
differ from the behaviour of the rest of the sample. These values, being so different, allow
the researcher to suspect that they have been generated differently from the other cases.
It is important to detect them because, firstly, they distort the results by obscuring the
behaviour pattern of the rest of the cases and obtaining conclusions that, without them,
would be completely different; and secondly, they can seriously affect one of the most
frequent conditions of applicability in most multivariate techniques: normality. Since in
this study we have used the structural equations models (SEM) technique, it is
imperative to detect and eliminate these outliers.

To identify the outliers a cluster analysis was carried out, taking as the
classification criterion the distance from the centroid (Uriel and Aldas, 2005). This
allowed us to identify one homogeneous group of data and another set with atypical
behaviour. In the final result, a total of 33 cases were eliminated, 19 from the sample of
public hospital users and 14 from the sample of users of the private hospital. Thus, the
valid sample consists of 308 cases, of which 157 interviews correspond to the private
hospital and 151 to the public hospital. The two hospitals attend more than 100,000
patients annually, so the population can be considered to be infinite. The sample error
in the private hospital is 7.98 per cent and in the public hospital 8.14 per cent, for a
confidence level of 95.5 per cent and a p q 0.5.
SEM techniques are used. The testing of the models is done in parallel in the two
samples, following the recommendations of Uriel and Aldas (2005). Thus, the models
are first tested in the sample of public hospital users and then in the sample of private
hospital users. The relationships that are verified simultaneously in both samples may
be generalisable.
Reliability and validity of the scales
A descriptive analysis of the data shows that in the public hospital there is a
preponderance of elderly patients (43 per cent), while in the private hospital the most
numerous age segment is that from 35 to 44 years (26.1 per cent). The user of the public
hospital is characterised by an educational level lower than secondary (84 per cent
have not reached this level), while the patient of the private hospital is characterised by
a higher than secondary level of education (73.9 per cent). Finally, it is notable that
women are the principal users of the private hospital (72.6 per cent), while in the case of
the public hospital the percentages of the two sexes are more evenly balanced (women
account for 55 per cent).
We first study the dimensionality, reliability and validity of the scales of
measurement of the different constructs considered in the models. Regarding the
dimensionality of the scales of perceived functional value, in the overall analysis we
observe that the probability associated with x 2 reaches a value higher than 0.05 (0.12),
so there is an overall fit of the model (Table I). The convergent validity is demonstrated
by the factor loadings higher than 0.5, and because each item contributes to forming
only the dimension that corresponds to it (Churchill, 1979). The composite reliability of
all the scales at individual level is satisfactory (Hair et al., 1998): for investment in
assets it is 0.88; professionalism of the hospital staff 0.90; quality of hospital services
0.86; that of monetary costs is 0.91 and that of non-monetary costs 0.74.
It was necessary to eliminate one item from the scale of non-monetary costs (every
time I have to come here I waste a lot of time). The divergent validity of the scales is
verified by the fact that the confidence interval of the correlation among the different
variables considered does not include unity (Table II) (Anderson and Gerbing, 1988;
Bagozzi et al., 1991; Laroche et al., 2003; Steemkamp and van Trijp, 1991).
Continuing with the study of the scales, we proceed to analyse the dimensionality,
reliability and validity of the scale of satisfaction (Table III). The probability associated
with the x 2 reaches a value higher than 0.05 (0.24), so there is an overall fit of the model.
The convergent validity is shown by factor loadings higher than 0.5. The composite
reliability of the satisfaction scale is high, the statistic that determines it having a value
of 0.89.

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Table I.
Questionnaire and joint
study of the
dimensionality, reliability
and validity of the five
scales

Items
Investment in hospital assets
P1.1
The installations facilitate confidentiality and
privacy of contacts
P1.2
It seems well organised and tidy
P1.3
The installations are spacious, modern and
clean
P1.4
It is easy to find and to access
Professionalism of hospital staff
P2.1
The staff know their job well
P2.2
The staff are up-to-date in their knowledge
P2.3
The information provided by the staff has
been very valuable to me
P2.4
The staff know about all the services offered
by the hospital
Perceived quality of hospital services
P3.1
It is well organised
P3.2
The quality was maintained throughout the
contact
P3.3
It has an acceptable level of quality if we
compare it to others
P3.4
The staff are always kind and friendly
P3.5
The medical team got the diagnosis and
treatment right
Monetary costs
P4.1
The money spent is well worth it
P4.2
The service is good for what I pay every
month
P4.3
The economic cost is not high
Non-monetary costs
P5.1
The waiting lists are reasonable
P5.2
The time you have to wait in the waiting
rooms is all right
Fit of the model
x 2 152.13. gl 133, p 0.12, RMSEA 0.022, GFI 0.95, AGFI 0.93
Reliability composite
Investment in assets: 0.88
Professionalism of hospital staff: 0.90
Quality of hospital services: 0.86
Monetary costs: 0.91
Non-monetary costs: 0.74

Factor loadinga

0.85 (fixed)
0.85 (fixed)
0.85 (fixed)
0.69 (15.09)
0.84 (fixed)
0.84 (fixed)
0.84 (fixed)
0.81 (fixed)
0.76 (fixed)
0.79 (fixed)
0.76 (fixed)
0.76 (fixed)
0.61 (13.50)
0.85 (30.83)
0.95 (fixed)
0.83 (30.83)
0.80 (fixed)
0.69 (30.83)

Notes: aThe t-statistic in parentheses. Completely standardised solution

The scales of trust meet the requirements for a formative construct posited by Jarvis
et al. (2003). According to these criteria, trust is a first-order reflective construct and a
second-order formative one. This means that the two indicators of trust (honesty and
benevolence) are independent of each other and do not share a common theme.
Following Diamantopoulos and Winklhofer (2001), the study of the reliability and
validity of the formative indicators is based on the analysis of the non-existence of

Investment
in hospital
assets
Investment in
hospital assets
Professionalism of
hospital staff
Perceived quality
of hospital
services
Monetary costs
Non-monetary
costs

Perceived quality
of hospital
Monetary Non-monetary
Professionalism
services
costs
costs
of hospital staff

Healthcare
services

85

0.69 (0.61-0.77) 1
0.78 (0.70-0.86) 0.78 (0.70-0.86)
0.39 (0.31-0.47) 0.41 (0.33-0.49)

1
0.53 (0.45-0.61)

0.45 (0.37-0.53) 0.43 (0.35-0.51)

0.61 (0.53-0.69)

1
0.61
(0.51-0.71)

Items
I am satisfied
My expectations have been met
Compared to other hospitals, the level of satisfaction has been high
Fit of the model
x 2 1.40, df 1, p-value 0.24, RMSEA 0.036, GFI 0.99, AGFI 0.97
Composite reliability: 0.89

Table II.
Divergent validity of
scales associated with
perceived value

Factor loadinga
0.91 (fixed)
0.93 (fixed)
0.77 (18.97)

Notes: aThe t-statistic in parentheses. Completely standardised solution

collinearity among the indicators (linear regression analysis, where all the indicators
composing the construct appear as independent variables[1]), and on the study of
external validity (second-order confirmatory factor analysis).
The study of the dimensionality, reliability and validity of the two reflective
constructs (honesty and benevolence) is carried out first. The second-order
formative character will be studied later. Table IV gives the joint analysis of
dimensionality, reliability and validity of the scales of trust. The fit is good, because
the value of the probability associated with x 2 is higher than 0.05 (0.10).
Convergent validity is shown by factor loadings higher than 0.5. The
composite reliability of the honesty scale is high, the statistic that determines it
having a value of 0.92. Likewise, the composite reliability of the benevolence
scale reaches a satisfactory value (0.94). The overall composite reliability of the
scale is 0.96.
The divergent validity of the scales is verified by the fact that the confidence
interval of the correlation among the different variables considered does not include
unity (Table IV).
With respect to the second-order formative character of the trust construct, the
study of non collinearity among the indicators is carried out in Table V, showing the
variance inflation factor (VIF) test after a linear regression analysis, taking as
dependent variable an overall measurement of trust. It can be observed that the value
of the VIF is in both cases less than 5.

Table III.
Questionnaire and
dimensionality, reliability
and validity of
satisfaction scale

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86

Table IV.
Questionnaire and
dimensionality, reliability
and validity of trust scale

Factor loadinga

Items
Honesty
The staff are trustworthy
The staff are honest
The staff have integrity
It has a good reputation
Benevolence
The staff were concerned for my well-being at all
times
They have always been concerned about my
problems
I am sure they always want the best for me
Fit of the model
x 2 22.32, df 15, p 0.10, RMSEA 0.040,
GFI 0.98, AGFI 0.96
Composite reliability
Honesty: 0.92
Benevolence: 0.94
Trust: 0.96

0.83
0.92
0.90
0.82

(26.72)
(fixed)
(fixed)
(26.72)

0.94 (fixed)
0.92 (fixed)
0.87 (26.72)

Notes: aThe t-statistic in parentheses. Completely standardised solution

Statistics of collinearity
Table V.
Collinearity test

Dimensions

VIF

Honesty
Benevolence

2.638
2.638

As a final step in confirming the dimensionality of trust, we carry out a second-order

confirmatory factor analysis. This is in order to study the external validity of the formative
scale, so following Jarvis et al. (2003), we incorporate the general measurement of trust into
the model as a dependent variable (Figure 2). The probability associated with x 2 reaches a
value higher than 0.05 (0.15), so there exists an overall fit of the model.
Finally, we analyse the dimensionality, reliability and validity of the scale of
commitment-loyalty (Table VI). The probability associated with the x 2 reaches a value
higher than 0.05 (0.10), so there exists an overall fit of the model.
The convergent validity is demonstrated by the factor loadings higher than 0.5.
The composite reliability of the conative loyalty-commitment scale is high, reaching a
value of 0.93.
Therefore, the study of the dimensionality, reliability and validity of the scales used to
measure the variables included in the model is satisfactory. It only remains to indicate that
the scale of non-monetary costs had to be filtered because one item had to be eliminated
from the original scale.

Trustworthy
staff
Honest staff
Staff integrity

Healthcare
services

0.85
0.88

HONESTY

0.88
0.65

87

0.83
Good reputation
TRUST
Concerned for
my well-being
Concerned about
my problems
They want the
best for me

Overall measure
of trust

0.15

0.95
0.92

BENEVOLENCE

0.87

Figure 2.
External validity of trust

Notes: c2 = 20.67, df = 15, p-value = 0.14758, RMSEA = 0.035, GFI = 0.98, AGFI = 0.96

Items
Commitment
It has shown at all times its capacity to meet its
obligations (skills and technical and human
resources)
It has always been a positive experience
There is not a better one
Emotionally, I feel close to the hospital
I always feel very much at ease
The staff always treat me like one of the family
Fit of the model
x 2 10.31, df 9, p-value 0.33,
RMSEA 0.022, GFI 0.99, AGFI 0.97
Composite reliability: 0.93

Factor loadinga

0.78
0.83
0.76
0.86
0.88
0.90

(25.51)
(24.08)
(25.51)
(fixed)
(fixed)
(fixed)

Notes: aThe t-statistic in parentheses. Completely standardised solution

Results
Figures 3 and 4 show the test of the model for each of the two samples. The causal
analyses were carried out by means of path analysis, taking the average values
weighted according to the factor loadings.
It is necessary to highlight from the start that the overall fit of the model is adequate
in both samples, because the probability associated with x 2 is higher than 0.05 (0.15
and 0.18, respectively).
With respect to the specific results, in the sample of public hospital users all the
relationships posited are significant, except the relationship between the professionalism

Table VI.
Questionnaire and
dimensionality, reliability
and validity of the
commitment scale

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88

Assets investment
Hospital
installations

Evaluation of
attributes and
characteristics of
the product/service
Professionalism
Hospital
personnel
Perceived quality
Hospital services

0.14 (8.36)
Trust:
honesty
0.13 (8.36)
0.13 (8.36)

0.45 (6.31)

0.32 (4.64)
0.38 (6.76)

0.14 (8.36)

0.14 (8.36)

0.17 (2.78)
0.33 (4.75)

0.21 (3.48)

Trust:
Benevolence

0.14 (2.09)

Hospital
Monetary costs
0.14(8.36)

Figure 3.
Test of the causal model in
the sample of public
hospital users

Loyalty
commitment

Satisfaction

0.32 (4.26)
Price

0.12 (8.26)

0.14 (8.36)

Hospital non
Monetary costs
Notes: c2 = 29.97, df = 23, p-value = 0.15029, RMSEA = 0.046, GFI = 0.96, AGFI = 0.92
Assets investment
Hospital
installations
0.31 (4.12)
0.21 (2.74)
Evaluation of
attributes and
characteristics of
the product/service

0.08 (2.95)
Trust:
honesty
0.08 (2.95)

Professionalism
Hospital
personnel

0.08 (2.95)

0.25 (3.15)
0.08 (2.95)

0.28 (3.80)
0.34 (5.72)

Perceived quality
Hospital services

Loyalty
commitment

Satisfaction
0.37 (4.66)

0.38 (6.76)

0.32 (4.23)
0.16 (2.50)

0.33 (3.98)
Price

0.25 (3.62)
0.12 (2.09)

Hospital
Monetary costs
0.08(2.95)

Figure 4.
Test of the causal model in
the sample of private
hospital users

Trust:
Benevolence

0.08 (2.95)

Hospital non
Monetary costs

Notes: c2 = 24.42, df = 19, p-value = 0.18047, RMSEA = 0.043, GFI = 0.97, AGFI = 0.92

of the hospital staff and honesty. On the other hand some unsuspected relationships
appear, such as the influence of the perceived quality of hospital services on benevolence
(0.32) and the influence of monetary costs on honesty (0.21).
Regarding the influence of perceived value on relationship quality, the first thing
that stands out is that satisfaction is influenced by all the indicators of perceived
functional value, with practically equal values (0.14). Perceived quality acquires
importance in the formation of honesty (0.45) and of benevolence (0.32), so we can
conclude that it is the most important antecedent of trust. Monetary costs also exercise
a direct influence on both honesty (0.21) and benevolence (0.14). Finally, non-monetary
costs directly influence benevolence (0.14).
With regard to the links between the variables that form relationship quality,
satisfaction exercises a direct influence on the two indicators of trust (0.12 and 0.17),
but is not the most important antecedent. Among the antecedents of loyaltycommitment, satisfaction (0.32) and benevolence (0.33) are the fundamental ones,
though honesty also exercises a significant influence (0.13).
In the sample of private hospital users, all the relations posited between perceived
value and relationship quality are significant. Thus, satisfaction is influenced by all the
indicators of perceived functional value, notably perceived quality (0.37) and monetary
costs (0.25). Relations not posited in the model emerge, such as the influence of the
hospital installations on the two indicators of trust: honesty (0.31) and benevolence
(0.21). The professionalism of the staff also exercises an important influence on
benevolence (0.16).
Honesty is influenced by the professionalism of the staff (0.08) and by the perceived
quality (0.08). Benevolence is influenced by monetary costs (0.12) and by non-monetary
costs (0.08).
As to the relationships posited among the variables composing relationship quality,
satisfaction exercises a substantial influence on honesty (0.28), on benevolence
(0.32) and on loyalty-commitment (0.34). For their part honesty (0.25) and benevolence
(0.33) exercise a significant influence on loyalty-commitment.
The testing of the model on the two samples shows the significant
influence of perceived functional value over satisfaction and trust. In this sense,
the role played by perceived quality in the formation of satisfaction stands out, as
does the fact that both satisfaction and trust are key antecedents of
loyalty-commitment.
This means that all the hypotheses are tested. Thus, the installations, the
professionalism of the staff, the perceived quality, the monetary costs and the
non-monetary costs, become the basis of the whole model. The post-purchase
evaluation of the different attributes of an offer, and therefore the perception of the real
value, exercises a direct influence both on the satisfaction experienced and on trust in
the hospital. Satisfaction is the most important antecedent of commitment and of trust,
while service quality is the fundamental antecedent of satisfaction. Non-monetary
costs have a substantial influence on satisfaction and on trust wherever they appear, as
in the case of the public hospital. The results show the close link that exists between
satisfaction and loyalty, and also the central place occupied by the trust-commitment
tandem.

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Discussion
Theoretical implications
The objective of this study has been to identify the antecedents of loyalty in the
hospital context from the point of view of the agency theory, which when applied to the
explanation of loyalty behaviour enables us to justify the role of perceived value and of
relationship quality, two emerging concepts in marketing research.
Perceived value has been catapulted by the AMA (2004) to the very heart of
marketing. The consumer makes evaluations based on perceived value, and therefore
on the comparison between the benefits and the sacrifices of an offer. The agency
theory is a cognitive theory, based on the processing of information, and together with
the most recent research into perceived value, it permits identification of the
antecedents of loyalty. From a theoretical viewpoint, therefore, this study enables us to
understand better the central role played by perceived value in marketing in general,
and in the explanation of consumer loyalty behaviour in particular.
Agency theory also enables us to justify another emerging construct: relationship
quality. The relationship between two parties may be governed by contracts, but
independently of the legal aspects, each party makes a subjective evaluation of the
relationship. This concept is what relationship quality tries to reflect. Satisfaction, trust
and commitment have been identified as the key indicators of the construct. In this
study, we have accepted the assumption that loyalty is a reflection of the different
levels of the consumers commitment. The results show the close link that exists
between satisfaction and loyalty, and also the central place occupied by the
trust-commitment tandem (Morgan and Hunt, 1994).
These theoretical results add depth to the literature on the subject, because until
now the relationship between perceived value and the quality of the relationship had
only been dealt with in industrial markets (Ulaga and Eggert, 2006) and in consumer
markets (Moliner et al., 2007). However, the concepts had not been tested in a public
service context, where non-monetary costs are important. The two samples
investigated in the present study show similar conclusions, which permits a more
general application of the model proposed. Furthermore, a more complete explanatory
model of patient loyalty is contributed to the literature on healthcare marketing, with
the incorporation of the dimensions perceived value and trust.
At a methodological level this study has also attempted to highlight some matters.
Firstly, the need to differentiate formative constructs from reflective ones, since the
study of the dimensionality, reliability and validity of the scales is different. Secondly,
the convenience of eliminating outliers, due to the distortion that they can cause in the
results, using the cluster technique and taking the distance from the centroid as the
grouping criterion. Thirdly, that a single model should be tested on two independent
samples, permitting the generalisation of those relationships that agree and identifying
differences in behaviour patterns. These methodological aspects are not usually taken
into account in academic studies of marketing.
Managerial implications
From the entrepreneurial point of view, the study offers empirical evidence of the need
to measure and manage perceived value, through taking care of the installations, an
adequate human resources policy that recycles the staffs professional knowledge,
management of perceived quality, and attention to monetary and non-monetary costs.

Thus, we observe that monetary costs are important, but at a similar level to perceived
quality. By paying attention to the perceived value of the transactions the firm
achieves the management of relationship quality, reaching high levels of satisfaction
and trust, which, finally, will result in greater commitment-loyalty of the consumer
towards the firm. The recommendation is therefore that firms should introduce into
their strategies the concept of perceived value, overcoming a vision excessively
focussed on quality.
Focussing on the specific case analysed in this study, differences exist between the
behaviour of a patient of a public hospital and that of a private one. In a private
hospital the monetary costs and the service quality are fundamental, while in a public
hospital all the dimensions of perceived value are equally important, though the role of
non-monetary costs stands out. This is logical as the patient of a private hospital
makes a direct payment to the hospital, while in the public hospital this payment is
indirect, through taxation. The private hospital has sought to differentiate itself by
means of its service quality and the non-existence of waiting lists, which is one
explanation of why a citizen, in a country with universal healthcare coverage, contracts
the services of a private hospital. Despite these differences, the variables involved in
the explanation of patient loyalty are the same in both samples, which is a good
argument for defending the generalisation of the conclusions.
The profile of the users of each hospital is different, which seems to be a key factor
in explaining the results. The user of the public hospital is a person aged over 55, with
a low level of education, who is retired or works in the house, and with a medium to
low-income level. The user of the private hospital, on the other hand, is typically a
woman, between 25 and 54, with a high-educational level, active in the labour market,
and with a medium to high-income level. There are substantial differences in profile
with regard to income levels, which may explain the differences between the two
samples. In any case, the recommendations for each type of hospital seem clear. While
the public hospital must improve the management of non-monetary costs (waiting lists
and queues) and send signals to the market in respect of the quality of its services
(on most occasions the healthcare personnel of a public hospital also work in a private
hospital). The private hospital must continue with the policy of market communication
highlighting its low non-monetary costs and the quality of the service offered (for
example, in public hospitals the room is shared by two patients, while in a private
hospital the rooms are individual), i.e. highlighting the benefits offered in exchange for
the monetary cost paid by the patient.
At the level of healthcare policy, the existence of the two models of management
seems to have a space in the market. While universal public healthcare guarantees a
basic service to economically less favoured segments, private healthcare offers
an added value for those who want a better quality of service. There is a third model
of management, experimented with in some hospitals (public ownership and
private management) which it would be interesting to incorporate into this type of
studies.
Limitations of study and future research
All these conclusions must be taken with the caution derived from the knowledge of
the limitations of the study. First of all, we have analysed the loyalty attitudes of the
users of a hospital, which is a very specific context of study. Moreover, the analysis has

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focussed on two hospitals, so the sample, though sufficient, is restricted to two specific
cases. Although it would have been ideal to have samples of various hospitals and
from different geographical areas, budgetary restrictions and administrative
authorisations prevented this. Nonetheless, the study shows two specific cases that
are representative of the Spanish healthcare system.
Another limitation on the study is that loyalty is a continuous variable, which feeds
back to the process and is influenced by it. In this study, we have tested the model with
cross-sectional data, but it would be much richer to test the hypotheses in time series.
With respect to future lines of research, the results of this study swim in the
cognitive stream, not explicitly taking into account the emotional aspects of the
transaction. In future we feel it will be necessary to incorporate emotional marketing
and to analyse the role played by the emotions in the first moments of the transaction
(emotional and social value).

Note
1. Non-collinearity is reflected in the VIF with values of less than 5.

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Further reading
Casson, M. (1997), Information and Organization, Oxford University Press, New York, NY.
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Hallowell, R. (1996), The relationship of customer satisfaction, customer loyalty and

profitability: an empirical study, International Journal of Service Industry Management,
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Hanson, M., Hoskisson, R. and Barney, J. (1999), Resolving the opportunism
minimization-opportunity maximization paradox, working paper, Brigham Young
University, Provo, UT.
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service relationships, Journal of the Academy of Marketing Science, Vol. 27 No. 3,
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No. 1, pp. 67-85.
Corresponding author
Miguel A. Moliner can be contacted at: amoliner@emp.uji.es

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