How to Implement a "Good Neighbor Hotel" program for your medical tourism clinic

Yesterday's post on Key Performance Indicators for medical tourism statistics and market growth seemed to generate lots of views and offline questions and comments. Bottom line: I think that many people agreed with me, but were afraid to go "on record" to do so.

That can be for a number of reasons: 1) They didn't want to call out those who publish inflated and unsubstantiated numbers, 2) they've already suffered the consequences of making reliance upon those numbers and suffered an fatal business setback bouncing them out of the market and out of medical tourism altogether. Some lost millions! 3) They are afraid their boss will realize that they don't know as much about managing a medical tourism department and its bottom line performance as they led on when they were hired.

There's no shame in ignorance. The shame is in not doing anything about it.

Return on Innovation Investment

One of the KPIs I explained yesterday was that of Return on Innovation Investment. To review, I explained that first, we must establish that health and wellness tourism are "innovations". That is to say that they are a new method, idea, product, etc. So many health facilities and doctors don't view health and wellness tourism as innovations. They view it as an extension of that which they are already doing - and merely selling off excess capacity. I find these are the first sellers to fail. Always.

A health and wellness tourism service, properly configured is an innovative new product or method of selling healthcare and wellness services. The turning point is the "creation of service bundles into packages" versus merely "fixing fee-for-service appointments". Many of the emails I receive from doctors and dentists want more appointments. They have no "bundled packages" created and prepared for the marketplace.

Return on Innovation Investment measures the returns generated from investments in innovation. The formula for this KPI is: Return on Innovation Investment = [(Net Profit from new products and services) - (innovation costs for these products and services)] / (innovation costs for these products and services).

So this brings up a neat little segue for today's focus, Developing a Good Neighbor Hotel program. Developing a unique destination or clinic program in health tourism is something I know a lot about because I've helped set them up all over the world. In fact, I authored the best-selling book on this topic, internationally published by CRC, a subsidiary of Informa, the international publisher and conference organizer. Here's what I can share with you from experience and my training.

In designing medical, dental and wellness tourism programs, we begin with a design or concept note. This explains what the program is about and why it should be created and what benefit will be expected as a result of the program's implementation.

From there, the next step is to create a prototype or pilot program with a few test participants. As a part of this pilot program, before you can recruit candidate suppliers, you'll first have to set up performance standards and criteria for inclusion in the panel of participating suppliers.

Does every hotel near your hospital or clinic meet the specific criteria to accommodate your peri-operative and post-operative recuperating patients? Well, probably not. Will your patients' needs be identical to your competitor's needs? Perhaps. Perhaps not.

Those that view the medical and dental tourism as an extension of their existing activities and merely want more appointments set can stop reading at this point. The rest of this article is not relevant to your business model. You'll never need to measure a KPI for Return on Innovation Investment because you don't intend to spend anything extra to meet your objectives. You have no program and don't intend to create one. Your business model is centered on fixing appointments based on your connections to facilitators who will work for free...err, will refer patients to your practice or clinic at their own risk. If you pay them the "marketing fees" negotiated as agreed, there's no program, just appointments. There's no crime in this business model except where there are regulations and laws that prohibit the brokering of medical and dental referrals and payment of kickbacks on what appears to be an objective and unbiased professional recommendation or steerage to the highest bidder. The US, UK, Germany and Canada are four places where this business model is or may be problematic.

The second group is made up of those who view medical and dental tourism as an innovative product they wish to design and launch. These are the clients who engage a fee-based consultant to assist them in the development of their medical and dental tourism product innovation.

This Return on Innovation Investment KPI has very little to do with how much I will charge them or how successful I am at raising closed sales. In fact, I don't raise close sales personally, my clients do. The responsibility for success with their medical or dental tourism innovation is 100% on them and no one else.

First, to create a Good Neighbor Hotel program, they must begin by completing a situation analysis and key competitor assessment:

• What kinds of hotel accommodation are appropriate for the procedures they perform?
• Which criteria must a hotel meet to be considered appropriate? (Room layout, furniture, fixtures and equipment (FFE), food and beverage availability, menu adaptations, floor and wall coverings, linens, live plants in the rooms, the halls, stairs, elevator (lift) size, configuration of regular and disabled access rooms, placement of mobility challenged patients to rooms in 3rd or higher floor above street level, access to the property by emergency apparatus, proximity and transportation to and from medical appointments and the airport, amenities, shuttle vehicle design and safety checks, and more.)
• Special incentive programs and exclusive pricing for your patients and their traveling companions, not available to your competitors
• Languages fluency of front desk, spa personnel, waitstaff, housekeeping, concierge, and security staff in the key languages of your ideal and highest volume targeted medical travel patients
• Security policy, shelter-in-place and disaster preparedness, seismic construction standards, flood plane location, cancellation and walk policies, and more. One of our team members is a former police chief who now consults on security assessments and preparedness for health tourism hotels, airports, and ground transfer partners.

Each of these considerations may be generic or your patient population may have special needs. When someone calls me to help them innovate and implement a medical or dental tourism program, it is impossible for me to give them an estimate of what my consultation will cost, or how long it may take from first call to "go live". This is because I have yet to learn of their patients' special needs, targeted cultures and languages, and the procedures that the provider expects to attract through medical and dental travelers.

Once I am informed of those basics, I draft the concept note in the context of the vision of their unique program. From there, I can quickly conduct site inspections and assemble from professional experience, my nursing training, and hundreds criteria I've developed over 35 years in medical tourism and past client consultations, the minimum criteria for providers and suppliers to be considered candidate Good Neighbor Hotels. The document set includes, among other things, the site inspection protocol, the interpretation of findings and objective, unbiased scoring system, and the draft Good Neighbor Hotel partnership or collaboration agreement or memorandum of understanding ("MOU"). Beyond that, some mystery shopping may be in order to test the program to ensure deliverable by the hotel is as expected.

If you are inclined to ask me if I will sell this criteria to you via email without the needs analysis and situation assessment, the answer is "no". The best I can offer you on a D-I-Y basis is that which is published in the Handbook of Medical Tourism Program Development book (above) and the Medical Tourism Facilitator's Handbook (left). there are some very basic checklists in each to get you started on your own.

One risk is rare: that the situation and competitive assessment is performed, analyzed and the recommendation is not to move forward with any of the local accommodations, even though the bill for the situation and competitive assessment is due and payable to me. Experienced veteran entrepreneurs and investors view this expense as an ounce of prevention rather than a loss. But what's next? Abandon the innovation?

A few hospitals and clinics in the USA and abroad have set aside a block of rooms that were once on market for patient admissions and converted them to hotel rooms. Others have invited investors to build an adjacent hotel. Others have decided to buy a languishing inappropriate property with "good bones", and upgrade all or part of the former hotel or guest house to a patient and family accommodation and respite center. I've worked with investors who did this in Florida, New York, Mexico, Cleveland, Dallas, Costa Rica, Brazil, South Africa, Malaysia, Thailand, Korea, and hundreds of other locations over the past 35 years.

This latter approach enhances brand control, operations, and gives total control over pricing, booking, room assignment, food and beverage choices, FFE, and more.

For rural hospitals within the USA and rural hospitals in other nations, health and wellness travel is a great way to leverage assets that would otherwise go empty and unused into an innovative domestic (and/or international) survival tactic. Attract patients from far enough away that they must spend the night, but don't require an inpatient admission. Convert a few inpatient rooms to hotel-style accommodations similar to a Ronald McDonald House concept or an onsite hotel or B&B. Most check-ins will be at least 2 nights and some may be much longer - measured in weeks.

In Miami, years ago, the partner exclusive rate was $240 a night for a hotel in Coconut Grove. In rural Illinois, back in June 2017, the partner rate for the rural hotel I stayed in to do some hospital client on site training was $79 a night when rack rate was $142. They get this same special rate for all partner stays - consultants, visiting doctors, patients and their entourage, and vendors requiring an extended stay in town to implement a new piece of technology, etc.

The rooms available for the partner rate are nearly always occupied and reserved weeks in advance as a part of a health travel program. For my client, they were thrilled to pay only the discounted negotiated rate instead of having to reimburse me at the rack rate for my travel expenses. The rural, sole provider hospital was located 2 hours' drive from O'Hare International Airport in Chicago, in the middle of corn and alfalfa fields. But when a patient and family travels in, they are equally thrilled to be able to offer the closest, most appropriate hotel at a discount that was available only to their partner guests.

 I hope that this article on developing Good Neighbor Hotel programs for health and wellness tourism visitors has been enlightening for you and that you'll put this information to good use to the delight of your medical and dental tourism and wellness customers. If you believe you'd benefit from learning more, please save the dates and plan to attend my workshops on health and wellness tourism program development or invite me to lead a workshop and Master Class for your organization or medical tourism cluster association in 2018.

About Maria Todd

Maria Todd is the author of the Handbook of Medical Tourism Program Development and The Medical Tourism Facilitator's Handbook, along with 16 other professional and indispensable handbooks and business management books written for physicians, hospitals and healthcare organizations.

She teaches Master Classes on Medical Tourism startup and strategy through the Healthcare Business Institute and also offers personalized coaching in St George, Utah (112 miles north of Las Vegas). She has been hired to develop the national medical tourism strategies for several countries in Europe, Latin America and the Middle East.

She guides physicians, dentists, private and public hospitals and clinics and facilitators through the strategic planning, branding, digital marketing and execution of medical tourism startups. A typical engagement starts with a brief confidential interview and completion of a workbook assignment in which the physician or business owner gives forethought to many of the decisions about all the moving parts that are involved in the medical tourism offer. From there, a personal one-on-one consultation occurs (either in St George or the client's location) in which the workbook outputs are reviewed and finalized over a private training session. This sets the strategy and launch plan to paper which can then be used for business plan construction, and consultation with attorneys, accountants, and tourism authorities and to guide next steps to set operating budgets and revenue projections for the first 3 years. After this intense level of guidance, the client is usually able to launch independently and only call on her on an as needed basis.

If you'd like to know more, please contact her at 800.727.4160