Tuesday, July 27, 2010

Medical tourism...lessons from the California gold rush

In 1848, gold was discovered in California by John Sutter, a German immigrant. News of the find spread rapidly and thousands arrived in search of their fortune. Prospectors came from across the USA, from Hawaii, Mexico, Chile, Peru and China. The California gold rush had begun. California’s output of gold rose from $5 million in 1848 to $40 million in 1849 and $55 million in 1851. But there wasn’t enough gold to go around....only a minority of gold miners made much money from the Californian Gold Rush...the best equipped, the best informed, the best organised and resourced.

Others also made money; the saloon owners (and brothel keepers!) who kept the prospectors entertained made a healthy profit, and so did the entrepreneurs and store owners who provided the supplies and tools that the prospectors needed (often at exorbitant prices).

Are there some parallels and some lessons here for those involved in the medical tourism gold rush?

The discovery of medical tourism gold....
Although the concept of travelling for treatment has been around for centuries, it was probably around 2005 when the medical tourism gold rush really took off; it still continues today and shows little sign of abating. News stories appeared around the world about a surge in medical tourism – patients travelling to save money on treatment costs (as opposed to seeking medical services and healthcare quality that were unavailable in their own country). The first prospectors appeared - medical tourism agents and facilitators, and overseas hospitals and clinics seeking their fortune in the world of medical tourism.

Word spreads, prospectors pursue the dream of medical tourism gold....
The tales of medical tourism gold began to multiply. Estimates of the number of medical tourists were in the hundreds of thousands, the millions, and then the tens of millions. Few medical tourism prospectors questioned the validity of these claims of the discovery of a rich vein of income or whether it was sustainable.

Those involved in the early gold rush exaggerated their successes, claiming massive finds (e.g. “one million medical tourists to....), encouraging others to join the frenzy. Healthcare providers in countries all over the world entered the race - Singapore, Malaysia, Korea, Jordan, the Philippines, Tunisia, Turkey, Eastern Europe, many of them backed by their tourism boards, health departments and government initiatives who saw medical tourism as a rich source of foreign currency.

....without thinking or understanding what’s really involved
New entrants pursued the dream without really thinking through their strategy and approach to the market. Some went into the market ill equipped; some went into the market without realising what it might cost to be successful; some went looking for medical tourism gold in completely the wrong place!

A community of medical tourism prospectors develops
As the number of medical tourism prospectors grew, others (the saloon keepers) arrived quickly to profit from this growing community, and store owners and tool suppliers appeared to guide the prospectors in their pursuit of gold.

The saloon owners arrived in the form of the associations and medical tourism conferences that make their money from membership fees and delegate fees. They provided a place where the prospectors could get together, but they also built on the hype, retelling stories of the latest discoveries and attracting more people to the medical tourism gold rush. Of course, the more people in the gold rush, the more people there are in the saloon, and the more money there is to be made by the saloon owner.

The entrepreneurs and store owners also arrived on the scene to provide the tools that the prospectors needed to mine medical tourism gold. Web sites like our own (Treatment Abroad) that link patients with providers, systems companies like Health Travel Technologies and e-Medsol that provide the systems to manage patients, and consultancies, strategists and advisers like Irving Stackpole and Vivek Shukla who help the prospectors to locate medical tourism gold came into being. Are these entrepreneurs and store owners (including my own Treatment Abroad "store") taking advantage of uninformed prospectors by providing poor quality services and products and overcharging for them. Or are they providing sensibly priced services and much needed tools that will bring long term success to those who use them wisely? Only time will tell.... and it will be the success of the prospectors who determine our success.

The gold runs out...or is harder to find and mine
As in the California gold rush, reality has failed to live up to expectations for many prospectors. Clinics, hospitals and facilitators are finding it harder to acquire patients and there’s a great deal of competition out there. Nevertheless, for many the gold rush mentality continues.

After the gold rush?
So, what’s the likely outcome of all this? What can we expect in the next stage of the medical tourism gold rush? In my next blog post, I’ll give some thought to who will strike gold and how will the industry develop.

7 comments:

Anonymous said...

Nice article, I like the fact that you question your own company's value to an industry, something every business owner should do every once and while.

On your points, I can't agree with you more. Working for a medical destination facility, I am asked constantly to review requests from medical tourism companies, in particular, online ones.

And time and time again, I come back with the same question: what is your website traffic?

Many of these people have no online experience or SEO plan. The aptly named Field of Dreams "Build it and they will come" seems to take sway over good business practices.

So then there is the pitch "You are only paying for leads you receive". If only that was the case. Unfortunately, a poorly planned web strategy for inquires sends a lot of bad leads to an already stressed out email response team. Given a low percentage of conversions that these sites typically yield because of tyre kickers, the destination hospital/clinic is paying for extra time/people to handle the workload, and dealing with the frustrations of customer service staff who don't get responses back from the leads.

The shining gleam from the "medical tourism goldrush" blinds some companies to good, proper business practices, and they then expect the destination hospitals/clinics to fall in line to sign up.

Even for offline medical tourism companies, it should not be expected that because a new hospital/clinic to use is found that they should automatically pay you for referrals. You are now a "semi agent" for the company, and the patient's experiences are linked to both the referral company and the destination. If there is a truly sustainable business model, show with some "free" patients that a great experience can be created, and the money will come for sure.

Looking forward to your thoughts on who will strike gold.

Anonymous said...

What you are describing is an industry shakeout. Some member based group will form to replace MTA and their extremely expensive dues, EXPENSIVE conferences and the vague feeling they exist to drive consulting services to founders. Many of the portals may cause credibility problems for the industry because they are focused on ad revenue from medical service providers who are not accredited and have second tier skills.

But, it may be that wise, large self insured employers and insurance firms bypass all that and create internal or partner facilitation organizations to maintain quality. But, the public, not knowing how to detect a quality provider, by go through a bumpy learning curve. Recently two radio stations in the US have been reporting on botched lap band surgeries from Mexico without defining how to locate quality providers.

Keepe the ideas coming...

Anonymous said...

Dear Mr. Keith Pollard.
I am a post from the Tourism Authority of Thailand, I have permission to post news.
Thailand's Medical Tourism Blog Contest Thank you very much.

Sincerely.
Kan

Bloggers invited to compete for prizes in Thailand’s Medical Tourism Blog Contest

The Tourism Authority of Thailand’s Medical Tourism Blog Contest kicks off with cash and prizes worth nearly US$20,000 up for grabs, including a seven-day all-inclusive medical tour of Thailand for 12 finalists.
The competition is easy and fun, with the aim to promote medical tourism in the Kingdom by awarding winning contestants trips to the Land of Smiles and other prizes.
Twelve finalists chosen from the entries will win an experience of a lifetime: an all-inclusive seven-day Medical Tourism Familiarization Trip in Thailand, which will take place from November 20-26, 2010. Some of them will travel to Phuket, Chiang Mai, Pattaya and Ko Samui, while others will explore Bangkok. The TAT will arrange additional sightseeing tours for finalists so they can experience the attractions of Thailand as a medical tourism hub.
During the competition period from November 20, 2010 to January 31, 2011, each finalist will use blog posts, photos, videos and other social media tools to share their daily experiences with the medical services available in Thailand with a global audience. The goal is to inform readers about what is available and to persuade them to learn more about Thailand’s top medical tourism destinations.
In order to win, finalists must write the best blog post and attract the highest number of unique visitors. The blogger who attracts the most unique visitors to their URL will win the top prize of $13,000 ($10,000 in cash plus luxurious hotel vouchers worth $3,000 at Sri Panwa, Phuket and Westin Grande, Bangkok), and the finalist who the judging committee decides has created the best blog will receive prizes worth $5,000 ($3,000 in cash plus luxurious hotel vouchers worth $2,000 at Ratilanna Riverside Spa Resort, Chiang Mai and Absolute Chandara Resort and Spa, Phuket).
The competition is open to anyone who has experience writing blogs related to tourism or medical tourism. To enter, visit: www.MedBlogContest.com
This is a great opportunity to discover firsthand why Thailand has become one of the world’s top destinations for medical tourism.
Submissions are welcome until October 31, 2010. Check out www.MedBlogContest.com
For media enquiries, please go to the *Contact Us* page and select the subject Press Media Enquiry. A team member will contact you shortly after your submission is received.**

Anonymous said...

Dear Mr. Keith Pollard.
I am a post from the Tourism Authority of Thailand, I have permission to post news.
Thailand's Medical Tourism Blog Contest Thank you very much.

Sincerely.
Kan

Bloggers invited to compete for prizes in Thailand’s Medical Tourism Blog Contest

The Tourism Authority of Thailand’s Medical Tourism Blog Contest kicks off with cash and prizes worth nearly US$20,000 up for grabs, including a seven-day all-inclusive medical tour of Thailand for 12 finalists.
The competition is easy and fun, with the aim to promote medical tourism in the Kingdom by awarding winning contestants trips to the Land of Smiles and other prizes.
Twelve finalists chosen from the entries will win an experience of a lifetime: an all-inclusive seven-day Medical Tourism Familiarization Trip in Thailand, which will take place from November 20-26, 2010. Some of them will travel to Phuket, Chiang Mai, Pattaya and Ko Samui, while others will explore Bangkok. The TAT will arrange additional sightseeing tours for finalists so they can experience the attractions of Thailand as a medical tourism hub.
During the competition period from November 20, 2010 to January 31, 2011, each finalist will use blog posts, photos, videos and other social media tools to share their daily experiences with the medical services available in Thailand with a global audience. The goal is to inform readers about what is available and to persuade them to learn more about Thailand’s top medical tourism destinations.
In order to win, finalists must write the best blog post and attract the highest number of unique visitors. The blogger who attracts the most unique visitors to their URL will win the top prize of $13,000 ($10,000 in cash plus luxurious hotel vouchers worth $3,000 at Sri Panwa, Phuket and Westin Grande, Bangkok), and the finalist who the judging committee decides has created the best blog will receive prizes worth $5,000 ($3,000 in cash plus luxurious hotel vouchers worth $2,000 at Ratilanna Riverside Spa Resort, Chiang Mai and Absolute Chandara Resort and Spa, Phuket).
The competition is open to anyone who has experience writing blogs related to tourism or medical tourism. To enter, visit: www.MedBlogContest.com
This is a great opportunity to discover firsthand why Thailand has become one of the world’s top destinations for medical tourism.
Submissions are welcome until October 31, 2010. Check out www.MedBlogContest.com
For media enquiries, please go to the *Contact Us* page and select the subject Press Media Enquiry. A team member will contact you shortly after your submission is received.**

Mihkel, The Health Clinic said...

Being involved in medical tourism for the last couple of years I recently had some similar questions of my own. The hopes and prognosis about the number of patients travelling abroad really seems to be more a hype than reality and some institutions might be taking advantage of it and even be misleading by themselves. But as you described California gold rush, this is what happens if a new and profitable opportunity appears.

The question is how many new "diggers" will enter the scene of medical tourism and when will the market be so full that we will start to see companies to retreat? Or is this happening already?

In Eastern Europe some countries are just trying to find their way into the market....

But, as they say, only the strong ones will survive, so interesting times lay ahead.

Ramya said...

very well said!!!

Dan said...

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