Discovering Medical Tourism

According to a nationwide survey of 1000 adults conducted by Opinion Research Corp, Americans spend twice as much time researching car and computer purchases than they do in selecting a doctor, and 6 in 10 say they probably wouldn’t change their ways even if price and quality information on healthcare providers was readily available. It looks that the convenience factor is predominant yet one can wonder if this convenience is not correlated with the implicit message sent by the word doctor.

I am a huge fan of some consumer behaviour theories one of these being the famous ELM model (Elaboration Likelihood model) by Richard E. Petty and John T. Cacioppo:

 

A simple chart done by one of my friends at HEC to explain the ELM model

According to the ELM model one can take two routes when facing a decision problem: the central one which is rationale and the peripheral one which is affective. The  most important underlying concpet is the involvement of an individual when making his decision.

The model defines the elaboration likelihood (EL) of the communication situation as the probability of message- or issue-relevant thought occuring in the consumer’s head. From the consumer’s point of view, it is about engaging or not in extensive issue-relevant thinking to evaluate an issue. According to the ELM model, the involvement or elaboration likelihood (EL) conditions choice in the following way:

+ When the EL is high, the central route should be particularly effective.

+ When the EL is low, the peripheral route should be better.

Medical tourism to gain credibility and striking power should be able to take the central route hence rationalize the decision process by identifying (or creating) key factors to be evaluated by someone opting for the appropriate surgery practice. The involvement is in fact low when talking about surgery knowing that the final decision is normally handled by a professional and there is little need (besides cost) to jump from one specialist to another. The medical service is indeed a long term involvement on which there is only one element that pressures us to decide: trust. And trust is on the peripheral route… Plus the peripheral route is a bumpy one as changing doctor is a stress factor that is added to the primary and ultimate anxiogene factor: the surgery itself.

 Opting for another route thanks to medical tourism communicating through the tourism angle

Medical tourism revamp the central route by introducing new factors to be rationnaly evaluated such as: medical follow up through the trip, intrinsic quality of tourism services… Decision making will not only take into account the trust we have on a system but the rationale evaluation of the various benefits brought by medical tourism. Hospital accreditations, incentive programs proposed by companies or monospecialisation (best hospital for appendicetomy for instance…) can only help to opt for the central route… 

The Blue Ridge example seems to be an isolated one but as Lyn Fox, executive Vice Director of Sales at Global Healthcare choice has stated it in an interview for  the employee benefit plan review, the whole is waiting for one S&P500 company to opt for a medical tourism incentive formula to have a huge tidal wave of US companies jumping on the bandwagon. Mercer Human Resources is for instance rumored to draft one stop shop medical tourism solutions for three major S&P 500 companies for mid 2007.

Corporate Cultures and medical tourism

 

When a company is opting for medical tourism, the company is making two strategic moves:

+ They send their employees overseas during a longer period than usual

+ They provide service to an employee through a medical tourism agency that will make all the required arrangements to combine a tourist activity with the medical process.

However, the relation of trust is very engaging for any employee as conversely is the bold approach of the company. Medical tourism is a genuine social revolution for any company considering it. At this seed stage, a company using medical tourism solutions is relying on:

a. A hard nose will to innovate - make a difference and create buzz by all means

b. A dedication to entrust employees with responsibilities (they make the decision to go overseas not the company) - a paternalist approach?

c. A desire to control costs while still keeping its social duties (medical does not hinder health care but provide another solution) - boost profits from top management to basic workforce

The press releases throughout the world about medical tourism are often quoting one example. I would like to also talk about it: the Blue Ridge Paper Factory study case!

Blue Ridge Paper Products is a manufacturing firm in Canton North Carolina, with 2,100 workers. In 1999, while the company’s health care costs were increasing at 18 percent a year,

Blue Ridge was bought by a venture capital firm. As part of the company’s transition to a 45 percent employee stock ownership program, the union agreed to a 15 percent wage cut and seven-year wage freeze. However, between 2000 and 2006, employee healthcare costs for the company rose over 75% to a staggering 24 million USD.  

An innovative policy derived from a voluntarist corporate culture

The relative weight of the healthcare benefit system was denting profit growth and slowing down recruiting processes.

 

Blue Ridge had to find a way to trim down healthcare costs that were rocket soaring. The company did so by launching for instance a diabete management program that waived copays on medicine. However in 2005 the healthcare cost was still increasing by 3,5% therefore Blue Ridge visited overseas hospitals and worked with IndUSHealth to find more cost cutting solutions.

 

The latter company produced a DVD encouraging people to go to

India in order to perform their surgery. By doing so, employees will get a 100% reimbursement plus travel expenses for themselves and a companion and the employee can receive up to 25% of the savings garnered fro; the outsourcing. For instance, one of their employees in 2006 decided to remove his gallstones and have his rotator fixed. The company will save about 80000 USD on both surgeries while the employee will receive a 10000 USD bonus for the trouble. 

How can one decently say no?