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How to Attract American Medical Tourists to Colombia: Some Strategic RecommendationsDr. David G. Vequist IVFounder/DirectorCenter for Medical Tourism Research (CMTR)University of the Incarnate Word (UIW)San Antonio, Texas, USA
AgendaDescribe the CMTRThe Healthcare Situation in the
U.S.Some Findings from Our ResearchAnalysis of the TrendsHow Colombia Can Benefit from
Medical TourismROI defined
Recommendations
About UsCenter for Medical Tourism
Research◦First and leading academic-based
research center in this industry (Medical & Retirement Tourism/Travel)
◦Non-profit◦Focused on the truth◦Motivated to spread the word and
influence key stakeholders◦Key members have years of
healthcare and international business experience
Model for Understanding the Drivers of Medical Tourism
Globalization
Consumerism
Technology
Medical Tourism
The Healthcare Situation in the U.S.
OECD Data
CBO Data
U.S. Healthcare Resources
OECD Data
Aging Population
Census Data
Stanford Data
Aging Population: Worldwide
Stanford Data
Aging Population: Healthcare
AHA Data
AHA Data
How Healthcare Reform (PPACA) Affects Medical Tourism- moreThe increase of the number of insured, the
removal of lifetime/annual caps, the reduction of the pre-existing conditions, and patients increasing paying with government ‘low margin’ programs will result in greater patient volumes at U.S. facilities and lower profits.
Currently, the U.S. overall healthcare capacity (due to increased volumes, lack of human capital, and increased utilization by an aging population) will not be able to handle the increased load (this is the surprisingly under-researched and under-debated issue in the reform debate) thus resulting in longer wait times, reduced quality, ‘rationing’ of care, and ultimately the increased need to ‘outsource’ extra capacity.
How Healthcare Reform (PPACA) Affects Medical TourismMany of the procedures currently very
common in medical tourism will not be significantly affected by health care reform (such as dental, cosmetic, and alternative therapies) and some surgeries (such as ortho, oncology, cardio, and neuro) may be affected by extended wait times.
In addition (and probably most importantly), employers will still be faced with increasing healthcare costs, additional pressures on lowering premiums, and required to cover more employees. This is the least served of the stakeholders in the U.S. and therefore one of the most important for medical tourism providers.
Healthcare Outsourcing Market
Source: Mattoo and Rathindran (2006)- Health Affairs
Benefits from Healthcare Trade
Summary of Healthcare Situation in the U.S.Not enough future capacityNot enough call for changesNot enough ‘political will’ to
change the system
Is outsourcing of capacity going to be a necessity for the U.S. healthcare system?
Medical Tourism GrowthAccording to Frost & Sullivan (2010):
◦ The medical tourism industry is currently a $78.5bn industry [end-2010], catering to over three million patients who travel around the globe for medical care.
◦ The sector is growing at a whopping 20-30% annually and is bound to continue its growth pattern in the years to come.
◦ It is expected to be a $100bn industry by 2012.
JCI Accreditation (300+ facilities)Growing without traditional
advertising (35% CAGR)- Deloitte
Evidence of Medical TourismGallup reports that 4% of Europeans
received medical treatment in another EU Member State over the past 12 months
UCLA forecasted that just under 500k Californians traveled to Mexico for health services
Dept. of Commerce reports that over 200k traveled to international destinations for health services
Based on a survey of 1,800 Americans- the CMTR forecasts that, in 2009, perhaps1 million citizens went abroad for health services
Texas Medical Center receives over 18,000 international patients in 2009
Medical Tourism: Continuum of Health Services
POTENTIAL AMERICAN MEDICAL TOURISTS
N = 2,000+
Potential Medical Tourist’s Views of Medical Tourism: Procedures
Source: CMTR, 2010
Why Travel? Value, of course!
Mapping the Market for Medical
Travel- McKinsey
2008
Don’t Forget Cost! Potential Medical Tourist: Reasons
What Do Medical Tourism Patients Want? (Deloitte, 2008) (1)
What Do Medical Tourism Patients Want? (Deloitte, 2008) (2)
What Do Medical Tourism Patients Want? (Deloitte, 2008) (3)
ConsumerismInformation more readily
availableDriven by the internet
◦Yelp/Angie’s List models springing up everywhere in healthcare
Employers/Governments are seeing some of the benefits of free market economics in healthcare (retail clinics?)
Porter’s Five Factors Lesson-◦Consumer Choice can bend the price
curve
Potential Medical Tourists: ResearchInternet was #1 by a wide margin
Source: CMTR, 2010
Social Media Usage60% of e-patients, or one-third of
adults, access social media related to health.◦In sum, 60% of e-patients, or 37% of U.S.
adults, have done at least one of these eleven social media activities related to health and health care. As health economist Jane Sarasohn-Kahn writes,
health-related social technologies capture “the exchange of health information and personal stories in a way that transcends both medical textbooks and chatting with a friend on the phone – yet offers some of the benefits of both.” Source:
Pew, 2009
On-line Health Tools
Source: Pew, 2008
Potential Medical Tourists: How to Arrange
Source: CMTR, 2010
EMPLOYEE BENEFIT DECISION MAKERS
N = 42
Type of Employer’s Insurance
Employer’s Views: Employees Abroad
Employer’s Views: Comfort
Employer’s Views: Perceptions
Employer’s Views: Tourism?
Employer’s Views: Procedures
Employer’s Views: Reasons
Employer’s Views: Timing
Employer’s Views: Arrange
Possible Trendlines in American Medical Tourism
COLOMBIA AND THE MEDICAL TOURISM CONTINUUM
Colombia’s Strengths & WeaknessesStrengthsClose proximity to a $2.5 trillion USD market Increasing perception in U.S. of qualityLow cost infrastructure (personnel, legal,
etc.)Positive cosmetic surgery perception (Mrs.
Universe & Super Models) Weaknesses Infrastructure issues and perceptions of
these issues (violence, poverty, disease, views on business, etc.)
Waiting for the Government to actDifficulties in coordinating stakeholdersLack of good research
Offer a Continuum of Services
Medical Tourism Country Investments (Potential)
Investments in High Tech and Commercial Research (e.g., Pharma, Energy, etc.)
ROI
Higher
Lower
Investments in HC & Medical/Retirement Tourism
Investments in Technology Manufacturing/ High-end Consumer/Commercial Products
Investments in Service Outsourcing
Investments in Basic Tourism Activities
Intensity of the
Regulatory Changes Required
Higher
Lower
Intensity of the Current Competitive Environment
Higher
Lower
Investments in Low-end Consumer/Commercial
Products
Estimates based on the CMTR
Colombia: ROI and InvestmentsROI described:
◦ Job growth (great jobs too!)◦ Brings opportunities for new direct (and
indirect) revenue streams◦ Fills a community need
Ask yourselves, based on the economic and environmental factors- “Will there be a time in the next 20-30 years when great healthcare will not be in demand?”
My Humble RecommendationsGovernment-
◦ Create a good business environment! Tax incentives, tax holidays, prioritize
infrastructure and regulatory improvementsPrivate Industry-
◦ Prioritize investments in this area and invest! Healthcare facilities and particularly retirement
tourism-aligned developments And, new technologies/procedures/treatments in
healthcareEducation-
◦ Get involved (and private industry- get them involved!)
Finally!Carpe Diem
◦Don’t wait for the U.S. stakeholders Physicians Hospitals Government
◦Don’t wait for the Colombian Government
◦Research, decide, and invest!
◦And don’t forget the ‘Gray Gold’ trend!
Good News!The CMTR and Stackpole & Associates
are working with ProExport Colombia to conduct specific research on possible medical tourism from the U.S. so as to develop specific strategies for Colombian facilities◦ In some previous work for the country of
Korea, the CMTR helped to develop strategies that increased American medical tourism by 52% and led to a total of $23 million in medical tourism revenues
Don’t Believe Me?IFC is:• the private sector arm of the World Bank• invests in private sector projects in developing countries• world’s largest multilateral investor in the private health sector
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