December 12, 2016

Medical Tourism Planning for Greece

by Maria K Todd, MHA PhD
Health Tourism Strategy Consultant (USA)


Focus on thermalism and spa tourism

Some years ago, the consulting firm McKinsey was commissioned to prepare a study titled, Greece 2020 – 10 years ahead. The critical reader would therefore make the assumption that the research was done in 2009, and published in 2010, some five years ago.

My how the landscape in Greece has changed in many ways over the last five years.

Anyone who would base all their strategies, critical public arguments, and recommendations on what that study put forth is obviously not a “forward thinker”, but hanging on to a report that has some, but not as much value going forward.

A critical thinker who is also an experienced consultant would take a recent situation analysis and compare it to what was “projected” by the McKinsey study. The critical gap analysis after 5 years presents an opportunity to make an interesting set of observations:

After 5 -6 years since the research and publication….

  1. How has the health/medical tourism market in Greece progressed? Along the linear projection suggested by the report’s authors? If not, why not?
  2. What is now the product of medical tourism in Greece?
    1. Is it surgeries and diagnostic studies for foreign patients?
    2. Is it hydrotherapies and thermal springs tourism? If yes, how far have they been developed and commercialized to produce turnover thus far and in the future?
  3. The McKinsey Study projected a gross of 11,000 new jobs sparked by medical tourism. Has that materialized? If not, why not?
  4. The McKinsey Study projected an influx of 150,000 visitors. Why is that number correct? Has any progress been made for medical tourism specifically over the past 5-6 years? Is the trend following a linear progression towards that number?

In some parts of Greece, private hospitals and clinics have begun marketing a medical tourism product. They attempt to sell appointments with staff and consulting physicians, diagnostic tests and surgical procedures. At the same time, spas and thalasso resorts that promote recreational, relaxation and rejuvenation services have been in operation for some time and are themselves responsible for a significant portion of turnover from tourism in Greece. Many have won worldwide recognition on many “Best of” lists created by industry, magazine publishers, and trade associations. They are fabulous!

Private hospitals in Greece have yet to develop a fully-operational marketing strategy, identify source markets, point advertising and promotion in the direction of those source markets, and round out the product promotion and delivery strategy as well as a measurement and evaluation system to see if it is working. They are the first to admit that they don’t really know “how” to prepare a strategy for medical tourism to differentiate Greece from all the other surgery and consultation sellers and diagnostic testing facilities around the world. Greek hospitals (public and private) have amazing clinicians, good technology, electronic records, telemedicine infrastructure and many of the other elements to make a medical tourism product. But like a car designer and auto manufacturer, they have a pile of parts to make a car – they don’t yet have the car and an identified target market that wants to buy the car. It will take time to do the market research and not cut and paste text from reports and articles about medical tourism. I am part of the team assigned to do that research. Despite rumours and propaganda to the contrary, neither the research nor the strategy has yet been completed. So let’s save that topic for the focus of its own article. Instead, I would like to focus this article on the thermalism opportunities for health tourism development in Greece.

As the author of 4 commercially-published professional trade books on health tourism business development, one is in the final stages of manuscript completion and publication. Its title, The Handbook of Thermal and Rehabilitation Resort Development: A guide for medically oriented health spas and sanatoria is a book designed to take the hotelier, health facility manager, resort developer or thermal hydrotherapy developer by the hand to show them the steps involved in conceptualizing, planning, marketing and operating this kind of a resort. My experience in this tracks back more than 3 decades to 1983 with the development and successful operation of three such resorts in the United States. The contents of the book is also from lessons learned and practical experience providing consultation to others throughout the USA, Eastern and Central Europe, CIS, Asia, Latin American, and Africa.

Each medical tourism initiative in Greece has been done without much assistance to promote the destination by the public sector. This is not a criticism. It is a reality, and rightfully so. The GNTO is the public sector driver who is really responsible for destination marketing messages, brand presentation (of Greece) and putting Greece on the map as a medical tourism destination. It makes sense to me, that without a formalized product strategy and product preparation for market, and without a target source market strategy, such promotion would be ill advised and premature. What exactly should they be promoting? “Come to Greece and enjoy our mostly undeveloped thermal springs?” And do what? What is the destination experience and package that makes it special, or that makes it uniquely Greek?

To date, very few thermal waters springs are development (measured by percentage of springs to percentage of those actually developed and ready to receive visitors specifically for therapeutic thermalism tourism).

The laws and regulations of thermalism in Greece

The laws governing the commissioning of the springs as a healthcare facility are spread across several regulations, integrating many from as far back as 1997 and 1999, and as far forward as draft regulations and Ministerial Decisions from last year, prior to the wishes, direction and philosophy of the current government.

Some commentators would have you believe that a new “framework regulation” should be drafted. Why? Because they earn money when working as drafters? Greece has many existing and complicated regulations. Why create more burden and the cost to go through the complexities of enforcement? Why not lay out all that is already promulgated, see if it works, and if not modify what is needed for contemporary and short-term future use? Why saddle the hoteliers and potential investors inside and outside of Greece with all this additional regulatory burden? Instead, modify the laws to the minimum extent necessary to be functional, and train the employees involved in audit and enforcement to be their best at what they do. I’ve read many of the summaries of these existing regulations and Ministerial Decrees or Ministerial Orders. Some just require a slight modification to be made current and practicable for forward momentum in balneo and thalasso hydrotherapy and other related forms of tourism. They really don’t require a complete overhaul.

The impact of a newly seated Administration

It is an exhilarating time in Greece. A new government, with new preferences, perspectives and philosophies of the new government leadership must be injected into the industry. In due time! Government leaders, advisers, and stakeholders must be afforded a fair opportunity to develop a practicable, achievable, paced “go forward” strategy for health tourism on all its legs, not just thermal springs tourism or public and private hospitals and clinics in health tourism. (For the sake of brevity, I use health tourism to encompass all medical, dental, rehab, and other forms of health tourism.)

One cannot, also assume that the work of the past government, it’s thought leaders, and others can be simply “cut and paste” to create what lies ahead. For starters, the funding to enable a strategy appears that it will be managed very differently. This will have a huge practical impact on how health tourism enfolds in Greece going forward.

In fairness, the newly-elected government leadership has been very busy with other “critical matters of the moment”. Give them adequate time to breathe, to ponder this broad medical/health tourism domain, to examine all the parts and interrelationships, to conduct one-on-one interviews with the foreign experts, to set aside hearsay, to be afford the chance to learn enough about the health tourism domain to make strong actionable decisions and to build strong government Ministerial capacities and understanding. To force them to act in haste serves no one. To base decisions on hearsay also serves no one but the rumormongers.

Government authorities and Ministerial advisors need time to study, receive competent and impartial guidance, and should be afforded the opportunity to sort out their thoughts, determine what they can commit, to whom, how, and how progress and success will be measured.

Spa Therapy Tourism in Greece

While they may feature identical pool design, fountains, waterfalls, and offer massages and other services, recreational (versus therapeutic health facilities) spas and health resorts, offer services that are elective in nature, require no doctor’s prescription. In many cases, most of these services are not likely to be reimbursed by EOPYY or other national and private health insurance schemes. Some are simply ineligible.

For those that would be otherwise eligible for reimbursement or direct payment by insurance schemes, they must be deemed medically necessary or therapeutic. To elect to utilize these services without a prescription and a written program is to risk a denied claim for insurance scheme reimbursement. Such a program includes documentation by a licensed and qualified healthcare professional that includes the patients’ name, identification number, a Subjective complaint, an Objective findings, a professional diagnostic Assessment by a competent medical professional, and a written Prescription or Treatment Plan for medically necessary treatments, or it is likely they will not qualify for payment through the insurance schemes. This S-O-A-P medical necessity documentation framework is at the core of insurance reimbursement all around the world.

Therefore, to recommend that Greece simply offer these services with the argument that “Greece can offer these services under the Cross Border Health Directive (2011)” is promising a possibility, not an actionable strategy.

Yes, of course it is possible, but before we can get to fruition, a few practicalities must be addressed:

  1. Who will manage all the patient coordination in the manner in which it will be required to involve formal payers?
  2. Who will file the insurance paperwork to support claims, appeals of denied claims or answer questions of insurers? Insurers are not in the business to pay “any claim”. Insurance funds are in the business to be responsible stewards of the funds to pay only rightful claims for services covered under the plans.
  3. Who will negotiate contracts with the insurers to agree to rates, payment terms, appeal terms, non-covered services, and more? Who will train the negotiators?
  4. Who will explain the laws, regulations, credentials and privileges and standards of the hydrotherapy resorts so that insurers take an interest in Greece as a destination that supplies these services?
  5. Who will market to the health insurance schemes, schedule tours?
  6. Who will act as the provider-payer liaison for day to day operations? EOPYY is too overwhelmed. The thermal hydrotherapy facilities do not yet exist in any great number for this, nor do they have trained staff for this.
  7. Who will teach the travel agents, tour operators, and medical tourism facilitators how to market the products and how to set expectations?
  8. What health and claims information system will be used to manage the infrastructure of all that is required to make this into an insurance-reimbursed product under EU directive 24/2011?
  9. From where will the money and expertise come to train new workers for all that is needed to manage such a comprehensive and complex infrastructure? How long will it take for them to be effective in their roles?
  10. What contribution margins will be produced in the first few years to sustain the cost to develop, launch, market, and operate such a system? Will the turnover and margins be worth the effort?
  11. What standards will be applied and from where will they be adopted? Currently the best standards for this can be adopted from several relevant existing sources, including, but not limited to:
    • ESPA, The European Spa Association
    • CARF, the Council on the Accreditation of Rehab Facilities (USA)
    • QHA Trent Accreditation Scheme (UK), and others.

These standards have been around for decades, are well-developed, far less expensive than most private commercial certification bodies, and can apply with equal relevance to both recreational and leisure relaxation and rejuvenation “spas” and also to therapeutic hydrotherapy health facilities alike.

Each body of standards suggests guidelines to model for water quality, sanitation, patient/guest safety, quality of credentials and privileges of medical providers and ancillary staff, give guidelines for medical documentation, privacy, security, and even special standards for preventive maintenance, etc. All are very comprehensive and well-developed and tested.

There’s no reason to pay great expense to reinvent the wheel. In fact, a copy of each of the standards is widely available for in many cases, less than $100 Euros. From a study of those, Greek Health and Tourism officials could have a running start to create a set of standards unique for Greece, if necessary. Alternatively, they could simply declare the existing standards as guidelines to be integrated going forward and save tremendous cost and expense for government, stakeholders, marketers, and insurers.

Simply to state that that “if the recovery costs are repaid in thermalism without prior authorization from anywhere within the EU – that it creates a colossal market opening and an unprecedented opportunity for thermalism centres of Greece,” is to demonstrate an ignorance or practical grasp of what is involved to activate the therapeutic hydrotherapy market for the thermal springs in Greece.

The activators, investors, and regulators must have a reasonable expectation that when they get beyond having such thermalism centres and having a law that enables insurance reimbursement without pre-authorization, that they will be able to progress to the other side of the throughput funnel to put the turnover in the bank at a cost that still enables them to realize margin.

And for those that tend to dismiss the pursuit of margins as a private sector initiative, I will share an old saying I learned in my healthcare business administration degree studies about margins…. In the USA, most of the 7500+ hospitals in the country are not-for-profit. The pursue margins because margins are the means by which the not-for-profit mission is made real. No margin; no mission. Margins are the key to operational and quality improvement sustainability without 100% dependence on government coffers for bail outs when the going gets tough. It’s what we do with those margins that makes all the difference in the world.