Medical Tourism and Captive Hotels
Monday, September 28th, 2015 and is filed under Commercial Real Estate, Real Estate
A brief tour around the hospitality industry would show many different hotel and motel properties that have a focus on a particular market niche of business or leisure traveler. For instance, it would be logical for a hotel in Page, Arizona to focus on travelers to the Grand Canyon. They might style their décor and Furniture, Fixtures and Equipment (FFE) to mimic the colors or topography of that natural resource.
The same focus and marketing effort goes into the Medical Tourism Industry and hospitality properties that support this unique industry. In the past, thousands of people would travel to the United States to take advantage of our higher standard of medical care. While this dynamic remains in place, it is now just as common to see citizens of this country traveling to other parts of the world for medical procedures and treatment. The cost of medical care in the United States and the fact that some cutting edge procedures have yet to be approved in this country, have contributed to the creation of treatment facilities and associated lodging options in many other areas of the world. For instance, some cancer treatments, plastic surgeries and experimental hormone therapies are not available in the United States so patients travel to places such as Mexico, Costa Rica, India or Israel. In many instances, due to the critical nature of the medical condition, extended wait times in the United States drive patients to seek the same treatment elsewhere. We are at a point where virtually every aspect of health care including physical and psychological conditions can be included in a medical tourism package.
It is an obvious fact that when someone travels to a different part of the world for any reason, they need a place to stay. The lengths of these stays can range anywhere from one or two nights to several weeks or months in cases where the medical condition requires multiple, prolonged treatments. In any case, there are hospitality properties that cater to these medical tourists and their families. Add to that, the situation where some guests might require special rooms or individualized daily activities and these properties become very unique and extremely important to the medical treatments themselves. For example, a patient being treated for pulmonary disorders such as cystic fibrosis or chronic asthma can book a hotel room or an apartment in a specially designed unit that has a sophisticated air filtration system to remove as much dust as possible.
While medical tourism certainly has benefits as described above, there can be drawbacks that should always be considered before booking a trip. There are different infectious diseases in Asia than there are in the United States and patients may not have built up natural immunities to these diseases which could affect the procedure’s efficacy and ultimate recovery. There is also the issue of follow-up care should it be required. It would be important for the patient to have these risks defined and addressed before the start of the trip.
It is not uncommon for these properties to actually be affiliated with, or owned by, the medical facility providing the treatments. It actually makes a lot of sense for both the hotel and the medical center because they can manage not only the actual medical procedures but much of the aftercare. Wealthy plastic surgery patients often book rooms near the doctor’s office to recuperate after the procedure to manage the swelling and discoloration before returning home.
The globalization of the healthcare industry and the ease with which patients can travel abroad for these medical procedures has created a strong niche within the hospitality industry. These properties can typically charge much more per night than a similar property not affiliated with a hospital or clinic because the guest is forced to be there in order to be treated.
That sounds like a healthy property from an economic performance and an investment standpoint.