Why Medical Tourism Clusters are Important?

Medical tourism clusters are a very important part of developing a robust trade in international patients as well as with regulators, providers and associations serving this community and the business behind it. One of the known tourism clusters in the United States is the Texas Medical Center located in Houston, Texas that attracts many medical tourists from around the world. Other global examples of long standing international health clusters include Korea’s KHIDI (Link Here), Malaysia’s MHTC (Link Here), and Turkey’s THTC (Link Here), the Kvarner Healthcare Cluster in Croatia (Link here), DXH in Dubai, UAE (Link here) which all have been considered to be very successful in helping their countries to grow their share of international health tourists.

The major benefit of clusters is that they lead to a synergistic impact for the businesses/organisations involved in the organisation. Research by the esteemed Dr. Michael Porter and the Harvard Business School found “evidence that new regional industries emerge where there is a strong cluster environment. Our analysis also suggests that the presence of strong clusters in a region enhances growth opportunities in other industries and clusters. Overall, these findings highlight the important role of cluster-based agglomeration in regional economic performance.” (Link Here) In an article by the OECD they found that in clusters they identified around the world “(over a 5 year period) incomes in this region have grown faster (14 percent) than the national average (9 percent).” (Link Here)

One of the most important lessons from these collaborations is that many successful clusters are

A) purposeful- planned not organic; and B) very inclusive of the stakeholders involved in the organisation. Although some small number of clusters, like Silicon Valley, did develop organically; most did not. In addition, many clusters don’t include all the types of partners they should - for medical tourism versions it should include (but not limited to): i. hospitals ii. clinics iii. hotels iv. transportation companies v. government officials vi. local media companies; and vii. entertainment venues. The vital goal of a successful cluster is for collaborating organisations to learn to compete and cooperate at the same time.

Some insights on Mexican Health Tourism Clusters

When the Mexican Ministries of Economy and Tourism approached the Center for Medical Tourism Research in 2022 to help the country to grow the health tourism industry in the country – one of the first strategies that we agree could help was to improve upon the existing and up-coming medical tourism cluster organizations in Mexico. Looking at the research, we all concurred that this would be a wonderful opportunity to create strong regional resources, such as found in vibrant medical tourism countries Korea, Malaysia, and Turkey. Medical travel cluster development is perhaps one of the best ways for an area to capitalize on the trend of international health travel. Working with a variety of stakeholders to develop synergies and reduce potential barriers can lead to various benefits for the community and even the country as a whole. This led to a multi-year contract with the federal government and more than a dozen regional clusters to enhance the capabilities of the industry-led groups.

Prior to our involvement, Mexico did have some history of creating successful medical tourism clusters. For example, in the city of Cancún, an initiative of committed stakeholders has resulted in the successful creation of a “health city” within the Yucatan resort community, further adding to the allure of this Caribbean city. It was therefore the recommendation of the CMTR that the development of robust medical tourism clusters in regions throughout Mexico following best practices and purposely designed strategies would lead to an overall increase in medical tourists for the country.

Currently, there are many places in Mexico that are trying to attract more American medical tourists including 15 different “medical clusters” (locations where stakeholders have developed infrastructure around medical tourism) in destinations that include Baja California, Mexico City, Puebla, Quintana Roo, San Luis Potosi and Yucatan to name just a few (Link Here).

In addition, for more about Health Clusters in Mexico see this Spanish language document from 2018 (Link Here).

Even newcomers to cluster development such as the Guanajuato region have seen a growing realization that they don’t have to just be on the border with the US to increase the number of medical tourists to the region. It just takes a concerted effort by the stakeholders (including: hospitals, doctors, hotels, and government agencies) to improve this business area (Link Here).

The initial results of the cluster development program have shown some positive results just over the last year and a half. For example, after the first medical tourism cluster training program, a survey was forwarded to the various medical and dental clinics in these regions. The results showed a up to a 7% growth in foreign patient volume (in 2023) after the program for participants. In addition, these facilities future spend on digital marketing was expected to increase (in 2024) and their ability to develop bundles of services (such as transportation, hospitality, food, and tourism), which international patients value, was enhanced. These improvements should help the facilities continue to grow their market share.?

Mexico has a tremendous opportunity with its close proximity and relationship to the US. However, many countries around the world are courting American tourists and retirees. In the near future, health tourism clusters can be a big part of the growth formula for the Mexican market. The next few years can be bright for Mexico if it harnesses its diverse stakeholders to collaborate effectively and focus on trying to attract more international patients in this fast-growing industry.

“Clusters affect competitiveness within countries as well as across national borders. Therefore, they lead to new agendas for all business executives—not just those who compete globally. More broadly, clusters represent a new way of thinking about location, challenging much of the conventional wisdom about how companies should be configured, how institutions such as universities can contribute to competitive success, and how governments can promote economic development and prosperity.”

????????????????????????????? Dr. Michael Porter

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About Dr. David G. Vequist,

David G. Vequist IV, Ph.D. is Empanelled Consultant for Strategic Management, Innovation and Medical Tourism at Vmarsh Healthcare . Dr. David G. Vequist IV is also a Full Professor and tenured faculty of Management in the H-E-B School of Business & Administration at the University of the Incarnate Word (3rd largest university in state of Texas, USA). In his previous career, Dr. Vequist was an executive at the Methodist Healthcare System, a multi-billion dollar healthcare provider (also a joint venture with HCA- the largest hospital system in the U.S.). Before that, Dr. Vequist was a consultant for Ernst & Young, LLP working with Fortune 500 companies. He is also an entrepreneur that sold a training business to Bloomberg. Professor Vequist has been a featured keynote at many conferences, worked with companies/governments/NGOs (such as the UN), and been featured in the media (e.g., the New York Times, Reuters, CNBC). He received his Ph.D. and Masters from the University of Tulsa and his B.S. from Northern Arizona University. Dr. Vequist is a well-known speaker, presenter, and futurist on subjects such as medical tourism, training, and human resources and the author of many articles, books and chapters.

For more details on how we can help build, serve or establish your Medical Tourism Strategy, Policies, International Patient Infrastructure as well as Public-Private-Partnerships in the subject, please visit Vmarsh Healthcare's website or contact us on [email protected]