Guest Analysis: Both Investors and patients Flocking to Colombia’s Clinics and Hospitals

Surgery sounded like it was going cost Edward Janssen an arm and a leg.

Even though he had medical insurance, his deductible created out-of-pocket expenses that would force the 58-year-old construction worker from Kansas to go to great pains to come up with the $80,000 to pay for a double knee replacement procedure at a local hospital in the United States. So he figured, until he learned from a medical tourism company that a trip to Colombia for his surgery would save him close to $15,000—airfare and lodging included—and afford him the opportunity to see a country he had never visited before.

Healthcare consumers, particularly those in Latin America, the United States and Canada, looking for medical tourism procedures are finding Colombia to be well within their comfort zones. Yes, a country once tarnished by a reputation for drugs and violence, has shed its controversial image and undergone a massive social and economic transformation to become a darling for Latin American trade.

Five of the top 30 hospitals in Latin America are in this city of some 2.5 million residents and Medellin’s proximity to the United States and Canada has North Americans eyeing procedures that can cost much less than the cost of those offered at home, but with comparable quality.

Astute financiers have not let this transformation go unnoticed. Investors are taking advantage of opportunities in new health- and wellness-based real estate projects and free trade zones to create a bold new sector that merges healthcare, hospitality and retirement living to generate revenue.

The notion that Colombia would be a burgeoning hub for anything beyond coffee– much less medical tourism — would have once seemed far-fetched. But, affordable pricing packaged with high-quality care is encouraging prospective patients to “Feel the Difference” In Colombia and attracting investors from all over the world to form medical tourism partnerships from Cali to Bogota and Medellin to Bucaramanga.

Groundbreaking urban planning and public transportation systems have done a great deal to sway skepticism both at home and abroad. So, too, have cold-hard facts: Colombia, the third-largest economy in Latin America after Mexico and Brazil, is growing steadily at almost 5 percent annually, comfortably above a 3 percent national inflation rate.

Urban areas speak to Colombia’s nearly 47 million inhabitants and the country’s economic rebound. Cable cars integrate tens of thousands of people each day from the poorer communities of Medellin where narrow hillsides are too steep for buses or cars to their modern metro system that reaches downtown employment, commerce, education, and healthcare.

At Medellin Health City, a cluster of local providers translate internationally accredited hospitals into a unique selling point that attracts foreign investors seeking healthcare services. The improved infrastructure along with enhanced patient services that these hospitals, surgical centers and dental clinics provide is not lost on local populations or the increasing interest of insurance agents and brokers, consulting firms and employers who seek to offer quality offshore options to their insureds and employees.

Word is spreading well north of the equator. Wall Street Journal Magazine, Citi Bank and the Urban Land Institute combined to call Medellin the most innovative city in the world. Without diminishing from the construction of new public libraries, parks, and schools, healthcare stands worthy of merit. Five of the top 30 hospitals in Latin America are in this city of some 2.5 million residents and Medellin’s proximity to the United States and Canada has North Americans eyeing procedures that can cost much less than the cost of those offered at home, but with comparable quality.

Epiphany

For Sharon Burke, the “epiphany” that she could travel from her home near New Brunswick to Colombia for immediate orthopedic surgery was a far cry from the three-year trek she was told to expect through Canada’s cumbersome national healthcare system. With the help of a friend in the airline industry, Burke opted instead for the six-hour flight to Medellin, where doctors removed a small cyst and bone fragments from her knee. Another procedure realigned her knee cap with her tibia. Burke said the four-hour surgery, six-day hospital stay and month-long apartment rental in the nearby rehabilitation center cost under $6,000. She says her pain is gone and she has no regrets.

Patients from Spain, Germany, Venezuela and the Caribbean have also come to recognize the advantages of medical tourism procedures in Colombia and the low costs and qualified surgeons involved in their care — from oncology and cardiology to neurology and orthopedics, according to the Medical Tourism Index, which ranked the nation among the top international medical tourism destinations in 2014.

ProColombia (formerly ProExport), a government agency charged with promoting foreign trade, points to a reversal in safety perceptions and alliances between government and private enterprise for elevating medical tourism revenue by some 61 percent, from $134 million in 2012 to $216 million a year later.

In accordance with that growth, new hospitals and clinics are sprouting up across the country, many with affiliations to big-name healthcare facilities in the United States including Johns Hopkins and, most recently, the University of Pittsburgh, which announced a 10-year agreement with the Cardiovascular Foundation of Colombia in Bucaramanga to develop and help manage an oncology center for adults and children. The opening scheduled for next year at the Hospital International de Colombia in Piedecuesta will mark the first international private oncology program in Colombia, a nation expected to experience nearly 80,000 new cases of cancer this year; a number feared to grow to 113,000 cases annually in the next 10 years.

Free Trade Zones

This type of investment is consistent with cross-border accords, such as the agreement between Proexport and Interventional Concepts, Inc., a leading development firm in Miami, Fla., that hopes to position Colombia — South Florida’s second-most important trade partner, behind only Brazil — as a premiere destination to conduct clinical trials for innovative medical technologies and pharmaceutical companies around the world.

Return on investment can become a tantalizing infatuation of sorts for any healthcare startup looking to make its mark in new surroundings. Medical tourism, envious of analogous groups found in hospitality and travel, is not immune to the preoccupation. Far too often, entrepreneurs—ambitious; yet, new to the industry or with little understanding of it—will squander resources on flashy internet marketing tools to build patient portfolios and rubber-stamp their expenditures. In the meantime, they wait for electronic responses or word-of-mouth referrals that never materialize. The larger opportunity exists through a two-pronged approach. The trick is to target local consumers at the onset, but build heavily on research-based strategies that identify diverse business-to-business opportunities to secure sustainable long-term growth.

Economic free trade zones, designed to attract foreign investment directly to Colombia, is one option worthy of pursuit. Puerta de las Americas Zona Franca, a “megaproject” underway on the northern coast of Colombia in Cartagena already sports a 40-bed hospital. The complex is planned to grow to 200 beds and feature a five-star hotel, restaurants and, eventually, retirement living to attract not only a local senior population, but foreigners seeking quality healthcare in their final place of residence.

Continuing Education

Changing healthcare dynamics will also enable Colombia to compete for top doctors and clinicians, some who have trained in the United States and Europe, but will instead be attracted to return home and research at these startup sites or answer to diverse and emerging opportunities, such as treating  50,000 foreign patients annually at some 75 medical facilities across the country.

Michael Losack, is an exception, of sorts to this recruitment strategy. The Harvard Medical School student chose to train for two months in the emergency room at Clinica León XIII, which is enjoying a massive revitalization since consolidating with the University of Antioquia. The 28-year-old American calls the practical patient experience he gained invaluable, but if he decides to return to Clinica León XIII after his required academic work is completed in the United States, he may learn that continuing education is essential.

Training  and certification programs are sprouting up around the world in convenient and supportive locations including Colombia to encourage healthcare specialists who are passionate in professional development and interested in current information about medical tourism, corporate wellness and health destinations to learn about successful case studies, industry best-practices and product and service innovations.

Magical Realism

After establishing a medical tourism program in 2010, patient volume increased by 45 percent at Medellin Health City, an alliance backed by the Mayor’s Office, Chamber of Commerce, University of Antioquia, and the Medical Tourism Association. Shortly thereafter and in anticipation of an even greater influx of international patients, 40 Medellin staffers took part in service development training to build up their industry knowledge and to understand the expectations of buyers of services.

They now know that not only a thorough understanding in the management of international patients, but a little kindness as well can make or break a medical tourism experience and become an imperative asset when competing for healthcare dollars against nearby Latin America countries including Brazil, the Dominican Republic, and Mexico. Continuing education and accreditation will continue to be at the crux of any service development strategy for Medellin Health City and the growing list of medical tourism players looking to accelerate patient recruitment to Columbia and generate the revenue that comes with it.

But, patient experiences can’t be measured in volume and statistics, alone. Maria Maldonado, a former associate at an international manufacturer of medical devices, was well aware of this pretention. She had already complimented her MBA with medical tourism certification after she joined Trip4Care, a Minnesota-based healthcare company. When Edward Janssen approached her about his aching knees and, more pressing, the financial dilemma he faced toward treatment, Maldonado was well-prepared to address the principles that drive medical tourism decisions.

“He was interested in Latin America, but was not keen on any particular destination,” said Maldonado. “We called three orthopedic surgeons within our network and ended up choosing Centro Médico Imbanaco, in Cali, Colombia—not because the procedure was less expensive, but because it would be a great opportunity to experience something he had never seen before.”

Now home in Kansas, with two good knees, at that, Janssen can attest to his medical destination’s latest slogan: When it comes to medical tourism, “Colombia is Magical Realism.”