MEDICAL TOURISM SURVEY 2018
Medical Tourism Associations & Clusters
July 2018
© LaingBuisson International Limited & HTWWLife
In March 2018, we invited organisations involved in the promotion and delivery of services to international patients to participate in the Medical Tourism : Associations and Clusters Survey 2018
The study aimed to provide a better understanding of the key benefits and challenges that medical tourism organisations, associations, and clusters face in working together to develop medical tourism.
Information provided for the study has been kept confidential. The responses of individual organisations and destinations has not been identified in the report.
All participants have been provided with a free report and summary of the results.
The study has been jointly funded and run by LaingBuisson International, publishers of International Medical Travel Journal and Health Tourism Worldwide.
The key findings were presented at the IMTJ Medical Travel Summit, which took place in Athens, 21-24 May 2018.
The survey was brought to the attention of 250 organisations around the globe. Responses were received from 27 organisations. A list of participating organisations is contained in the Appendix.
Rationale for the survey
Working together for better results is not new to any industry. There has been a significant growth of new associations and clusters entering the international medical tourism market in the last few years. The success and survival rate of such cooperation is random at best.
LaingBuisson International and Health Tourism Worldwide joined forces to create a snapshot of where medical tourism organisations stand in 2018, and share this with the participating organisations and the wider industry sector.
ORGANISATIONAL FORMS & FUNDING
Organisations were asked to describe the nature of their organisation.
There are three defining forms of organisation for industry cooperation in medical tourism:
1. A medical tourism cluster
2. A private company with the mandate to promote medical and/or health tourism, and
3. A non-profit, non-governmental organisation
Organisation Forms
Industry association
Medical tourism cluster
Health tourism cluster (wellness/spa)
Tourism cluster with a medical tourism department
Tourism association with a medical tourism department Government funded body
Private company with a mandate to promote medical and/or health tourism A non-governmental organisation (NGO) which is non-profit
Other
Legal status
Organisations were asked to describe their legal status.
Legal Status of the Organisation
Non-profit association
For-profit association
Non-profit company
For-profit company
Membership-based cluster
Informal cooperation with no legal entity
In an ideal scenario both private and public sectors contribute to the funding.
In an ideal case scenario the cooperation has a management body that deals with the everyday organisational and management issues. According to the results of this survey non-profit and for-profit organisation, all forms have almost equal shares.
These organisational foundations have direct impact on the sources of funding. Clusters and associations tend to have funding from multiply sources.
Our survey revealed that medical tourism associations and clusters have either 100% public or 100% private sources of funding On rare occasions, there is combined funding where public sources provide the majority of the funding.
Sources of Funding
Membership fees
Members/partners’ contribution to campaigns and activities
Donor-based funding (e.g. European Union schemes) also play significant role in funding. The strong business orientation of clusters and associations is confirmed by the role of revenues generated from commercial activities in the total funding. A few organisations charge new members for joining the association or cluster.
Public vs. Private Funding
State or government contribution
Donor-based funding (e.g. EU schemes)
Revenue generated from commercial activities
Sources of Private Funding
Looking at the composition of funding either from private and public sources, we can identify strong dependency situations. There are several organisations that have one single, or only a few major funding sources. There is little indication of healthy multi-source funding structures. This is especially true for the case of public funding. Local or national governments play the dominant or even exclusive role in the provision of funding for many organisations.
Experience shows that clusters and associations can be more sustainable and can play a more defining role if every member takes part in the provision of funding.
Hospitals and clinics
Concierge services
Travel and transportation companies
Hotels and accommodation providers
Individuals (i.e. doctors, physicians, consultants)
Other sources of funding
Interesting to note that medical tourism facilitators, restaurants and educational institutions do not contribute to the annual budget of medical tourism clusters and associations.
The research results reveal a wide divide in terms of the annual budget of medical tourism associations and clusters. The dominant annual budget is less than 50,000 EUR (58,000 USD) which is a rather small amount for such complex tasks.
Budget
Organisations were asked to state their annual budget (expenditure) for 2017.
Sources of Public Funding
Central government bodies
Regional government bodies
Local government bodies
Publicly owned organisations (e.g. hospitals, healthcare…
Tourism organisations (e.g. tourist offices, DMOs)
Educational institutions
Other sources of funding
The research results reveal a wide divide in terms of the annual budget of medical tourism associations and clusters. The dominant annual budget is less than 50,000 EUR (58,000 USD) which is a rather small amount for such complex tasks.
At the same time, significant percentage of respondents reported more than 200,000 EUR (233,000 USD) annual budget.
Reviewing the amount of the allocated budget will be especially relevant in comparison to the objectives and tasks associations and clusters defined for themselves.
Annual Budget
0-50,000 euros
50-100,000 euros
100–200,000 euros
More than 200,000 euros
MEMBERSHIPS & OPERATIONS
Organisations were asked about their membership structure.
Not surprisingly most of the members of medical tourism clusters and associations are either hospitals and clinics, or individuals working in healthcare.
The very nature of associations and especially that of clusters is the very complex membership mix. What brings members together is the shared and mutual professional and/or business interest in the same field, i.e. medical tourism. There are organisations where the organisational mix reflects the optimal scenario, but in many cases the membership mix does not appear to be very healthy.
Membership Composition
Hospitals & clinics
Spa and wellness providers
Hotel and accommodation providers
Medical tourism facilitators
Tourism/Travel agents
Transport providers Restaurants
Government organisations
Individuals (e.g. doctors, healthcare specialists)
Other
Note: average number of members
The research partially revealed as well as confirmed the trend that the role of spa and wellness providers goes beyond marginal. This is especially the case for health tourism associations and clusters in which both medical as well as the wellness tourism players join forces.
The average number of association and cluster members is 133, ranging from as small as 10 to as many as 1,700 members.
Large operations require significant size of human resources. This is confirmed by the reported size of operational bodies. The average number of permanent staff is 36, ranging from 1 to 430.
ACTIVITIES AND OBJECTIVES
Activities
Organisations were asked about the activities they undertake and to rate them in terms of importance.
The current activities of associations and clusters for the year 2018 were almost evenly distributed. The planned activities which achieved marginally higher position than the other alternatives were ‘Representing the organisation’s interest to government (e.g. lobbying)’ and ‘Providing trainings and workshops’
Pirority of Objectives
Providing a CRM solution for members
Collecting data on the activities of the participating member
Monitoring the performance of the participating members
Quality assurance of the participating members
Representing the organisation/members at events/fairs/expos
Representing the organisation’s interest to government
Destination branding and communication
Undertaking market research
Operating a sales platform (e.g. a web site)
Providing training and workshops
Note: on the scale 1 means not at all, whereas 10 means most important
Objectives
Organisations were asked about the activities they undertake and to rate them in terms of importance.
The top three objectives are short term goals related to patient numbers and revenue. Objectives related to the business-to-government relationship are much less of a priority. This highlights a discrepancy between the stated activities and the main objectives. The expected increase in patient and treatment numbers is a natural expectation from such organisations and its members, as is the growth of membership. However, the representation of the organisation’s interests to government as an objective is not even featured in the top of the most important objectives for 2018.
Adding to the understanding of how associations and clusters look at themselves, we asked if they would do anything differently, if they could launch the association or cluster again. The vast majority of the respondents appeared to be satisfied with the development and status of their organisations; they would not change anything, if they could start again. The only difference is that some of them would pay more attention to marketing activities.
TOP 3 Most Important Objectives for 2018
Providing training and workshops
Operating a sales platform (e.g. a web site)
Undertaking market research
Monitoring the performance of the participating members
Quality assurance of the participating members
Destination branding and communication
Representing the organisation’s interest to government
Representing the organisation/members at events/fairs/expos
Note: number of mentions for each objective
MEASUREMENT OF SUCCESS
Organisations were asked about how they measure the success of their organisation, where they actively and routinely collect data and measure success.
The most representative answers highlight the most critical areas of medical tourism cooperation:
• Removing friction for private players when they deal with government
• To mix tourism and medical sectors into an association
• Diversification of choices based on quality and price and getting efficient agents
• Consortium agreement of public and private clinics with purpose of common promotion and its costs sharing„ Consortium agreement of public and private clinics with purpose of common promotion and its costs sharing”
Measurement of Success
Patient Reported Outcome Measures for international patients
Systematic feedback from organisation partners/members
Awards won
Partner and member feedback
Performance of your social media platforms
Performance of your web platform
Conversion
Patient
of leads to booked patients
accommodation)
Patient spend on treatment and medical services
Number of treatments provided
Number of patients visiting the destination
Note: number of mentions for each measure
The number of treatments provided and systematic feedback from organisation partners and members appears to be the most important measurements of success for medical tourism associations and clusters.
This result adds to the discrepancy between objectives stated and activities done. It is a rather telling result that the organisations gave marginal importance for the following activities for 2018:
• Monitoring the performance of the participating members
• Collecting data on the activities of the participating members
The lack of reliable data is a global challenge in medical tourism. Solving this problem is not a priority for medical tourism clusters and associations.
TOP 3 Measures of Success
•#1 – Number of treatments
•#2 – Partners’ feedback
•#3 – Number of patients & Patient satisfaction level
The lack of data provides a major challenge to these organisations since they must find difficult to measure the results and success of their activities and efforts.
CHALLENGES
Organisations were asked about the greatest challenges that the organisation faces
There are three main areas that medical tourism associations and clusters consider challenging. Since the most important objective for 2018 was the increase in patient and treatment volumes it is understandable that marketing is considered as the key challenge.
Most Important Challenges
Securing finance and funding
Effective marketing and promotion to the target markets
Identifying target markets
Balancing the individual, competing interests of partners and members
Gaining support from public sector and government organisations
Gaining support from private partners and organisation
Being able to demonstrate success and a return on investment to the partners
The decision making process
Note: on the scale 1 means not at all, whereas 10 means most important
Securing funding is also one of the most important issues for the organisations. Since many depend on one key source of funding securing this funding will remain the most critical challenge.
Challenges
•#1 - Effective marketing/promotion to the target markets
•#2 - Securing finance and funding
•#3 - Gaining support from public sector/government organisations & Balancing the competing interests of partners/members
In terms of competitors and competition other medical tourism organisations as well as destination management organisations (DMO) appear to be important. We can see a rather delicate competitive situation. DMOs’ objectives are very similar to that of medical tourism associations’ and clusters’. Except that DMOs do not tend to focus on one single form of tourism only. The cooperation between DMOs and medical tourism associations and clusters is an area industry should focus on the near future.
Many associations and clusters reported that they do not see any competition to what they do.
Organisations were asked about their expectations regarding the prosperity of international medical tourism.
They had to indicate their predictions on a scale of 0-100 where 0 meant no growth at all, and 100 meant rapid growth. The organisations predict a moderate growth of international patient/medical tourism flow with certain local differences. The 19.6 standard deviation represent very different predictions depending on the location, specialisation and nature of medical tourism service providers in the association and cluster.
RECOMMENDATIONS / LESSONS LEARNED
This Medical Tourism Survey 2018: Associations & Clusters is the first of the kind. This pilot survey provides an overview of the key strategic activities and operational qualities of medical tourism association and clusters.
Based on the answers and the current state of the industry Laing Buisson and Health Tourism Worldwide compiled a few recommendations about the way ahead for industry cooperation:
➢ Improved Cooperation. Medical tourism associations and clusters need to improve their cooperation with other tourism bodies, especially local and national DMOs. The often overlapping objectives and activities require a more focused harmonisation and optimisation of activities. This is especially important given the limited funding for DMOs as well as for medical tourism association and clusters since they may compete for the same funding.
➢ Measuring Performance. Most organisations collect data about performance, but their key stated objectives and the data the collect may not be in line. The industry as well as the organisations need rigorous the implementation of data collection measures. This would make performances comparable. The medical tourism industry can learn from the performance monitoring techniques of the hospitality industry.
➢ Education and Capacity Building. Organisations reported their satisfaction of performance, since most of them would not do anything differently even if they could start the organisation over again. Learning from the industry performance, organisations may need to revisit this position and opinion. Global healthcare, wellbeing, travel, hospitality and IT industries change at a very rapid pace. New products, alternatives, solutions appear daily. Organisations need to be aware of where the opportunities or challenges are. They need to support their members and partners by sharing these market intelligence and improve their competitive position
CONTACT DETAILS
For further information please contact: LaingBuisson
Keith Pollard – Executive Chairman
László Puczkó –CEO keith.pollard@laingbuisson.com laszlo@htww.life