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Investment opportunity: Medical tourism

Tips on how to invest in this fast-growing industry, which expects more foreign patients to flock to the country for quality services
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Dr. REYVIC CERILLES and Dr. JOSEPH JAGORING: "Targeting foreigners seeking medical treatment could be lucrative, but it is also very challenging."

 

 

 

With its large pool of highly trained medical professionals, the Philippines is in an excellent position to capture a big slice of the fast-growing medical tourism market. The government has therefore stepped up its campaign to attract more foreign patients to come to the country to get medical treatment. Indeed, in the next five years, it is targeting an income of as much as $2 billion from medical tourism and from foreigners who have made the Philippines their retirement haven.

For the whole of Asia, the industry estimate for total medical tourism revenues in 2006 was US$2.5 billion, and this figure is expected to grow to $4.5 billion by 2012. The exodus of foreign patients to Asian locations is expected to continue due to two major reasons: the skyrocketing costs of private medical care in the United States, and the long waiting period to get medical care from the national health systems of some European countries.

The third reason is, of course, the fact that surgical fees in developing countries like the Philippines are as much as 50 percent lower than those of their Western counterparts. Foreigners can thus leverage their stronger national currencies to get quality medical care and make very substantial cost savings at the same time.

One of the medical establishments that have been benefiting from the country's growing medical tourism is Estetico Manila. Put up only in 2005, the medium-sized clinic is run by two medical partners: Dr. Reyvic Cerilles, a cosmetic surgeon, and Dr. Joseph Jagoring, a dentist.

Over the last two years, the partners have seen their clientele grow to an average of 200 patients a month, most of them seeking cosmetic surgery, dermatology, and cosmetic dentistry services. Of this clientele, 60 to 70 percent are foreigners and returning overseas Filipino workers (OFW).

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The most sought-after services in Estetico Manila are rhinoplasty (nose jobs), breast enhancements, and dental implants. The clinic charges fees ranging from P60,000- P80,000 for major surgical procedures, and as low as P1,000 for dental cleaning. The partners perform most of the simpler surgical procedures in the clinic itself, but do the more complicated surgical procedures in affiliated hospitals.

For entrepreneurs who are thinking of similarly going into the medical tourism business, Cerilles and Jagoring are sharing the following tips and insights:

1. Invest in modern facilities and equipment. Targeting foreigners seeking medical treatment could be lucrative, but it is also very challenging. You need to invest in world-class medical equipment, which, of course, don't come cheap. In Jagoring's case, his dental equipment cost him around P1 million to P2 million, payable over a period of years. Cerilles, on the other hand, invested about P500,000 to purchase an operating table and equip the clinic's operating room. The duo's advice: Second hand equipment is OK, provided they are properly maintained and serviced.

2. Document the partnership. Although partnerships are all about trust and confidence in one another, a good safeguard especially in the medical profession is putting everything in writing. It is equally important that the partners share the responsibility of running the enterprise. When they put up Estetico Manila, in particular, Cerilles and Jagoring and their former business partner, Dr. Erick G. Ducut, MD, pooled P500,000 each to pay for the design and construction of the clinic and to pay for the lease.

3. Be up-to-date with the latest advances in your field. In the fast-paced world of medicine, new advances and discoveries are made at such a brisk pace, so your medical clinic should always keep itself abreast with them and keep itself at a par with international standards in infection control and in new services, such as cosmetic treatments and dental implants. You and your partners should make it a norm to attend international medical fellowships and local medical seminars, and to religiously read the major medical journals. Doing these things will greatly help you maintain a high standard for your facility.

4. Hire a good accountant. Because theirs is often a very stressful and fastpaced job, most medical doctors are normally too burdened to keep track of their financials themselves. For this reason, Dr. Cerilles and Dr. Jagoring suggest hiring a good and trustworthy accountant to do the numbers game for the business.

5. Pamper your clients and go the extra mile. In the highly competitive environment of medical tourism, the entrepreneur must go the extra mile for his or her patients. Dr. Cerilles and Dr. Jagoring say that they go to the extent of picking up their foreign clients from the airport and bringing them to their hotels--in some cases even taking them out for dinner. They do all these to ensure a high rate of return business and referrals from satisfied clients.

6. Do a great job, or else. Foreign patients are your bread and butter. In the United States, in particular, there is a centralized complaint system for the health industry, where patients can lodge complaints against doctors or praise their work. This database is easily accessible to patients looking for medical treatment. Thus, making sure you do a great job not only will increase your chances of getting referrals but will keep you from being blacklisted as well.

FIRST TIME TO INVEST?
1. Invest in a website. Internet visibility is key when wooing foreign clients. A website that advertises your services, fees, and location will make it much easier for clients to find you. Also, joining an Internet-based industry association--the RXPinoy, for instance--can greatly help you market your clinic. Such associations usually provide a web portal that can redirect prospective clients to your own website.

2. E-mail queries are the norm. When patients visit your website, they would often post questions and inquiries through email server. Although answering them individually could take up a lot of your time, doing so will greatly enhance your chances of booking the inquiring client.

3. Make your clinic accessible. Locating your medical facility as near as possible to the airport or to major transportation hubs can do wonders for your business. Foreign patients usually abhor long travel times to and from the clinic, so make it easy for them to reach you--and make sure they are comfortable on the way to and from your facility.

4. Look the part. Wearing jeans or adorning your clinic with your mother's furniture may be appreciated by most of your local clients, but foreigners or balikbayans may find such informal touches distasteful. Foreigners are generally more discerning not only about their health but also about the look and feel of the medical facility and of the medical personnel attending to them.

ALREADY IN?
In the United States alone, an estimated 150 million people are either underinsured or completely not covered by health insurance.

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Both Dr. Reyvic Cerilles and Dr. Joseph Jagoring suggest that if you have not yet done so, you should reposition your medical facility to tap this huge market. They recommend that you do this by doing increased advertising in 2008 and in the next few years.

According to the partners, this market will feel increasing pressure to manage their own health in the coming
years. This means that they will want to shop around for services, prices, and other options that are more affordable and comfortable to them. American consumers, used to having the power of choice in their purchases of products and services, are expected to similarly exercise this power in choosing their health care providers in the next decade.


CONTACT DETAILS:
ESTETICO MANILA
Unit 501/502 Oakridge Plaza, 101 San Antonio St.,
Paseo de Magallanes, Makati City
Telephone: (02) 854-4933
Mobile: 0917-8104334
Website: www.esteticomanila.com

 

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