The Health Market – Chances for Bulgarian Tourism

Medical tourists search for medical care or health therapies to receive equal or better quality medical, surgical, dental and cosmetic care at lower cost in surroundings far more suited for recovery, than their home countries. Medical tourism, not always covered by medical insurance, attracts clients, male and female, with lower prices and the chance to combine a treatment with a holiday in an exotic location. Winners are former eastern European countries like Hungary and the Czech republic. Bulgaria needs some development to exploit the available high potential. The trend is: highly qualified medical practitioners, dissatisfied with low salaries in the public sector, set up private surgeries and clinics with individual specializations, catering to regional higher profile clients. The most renowned destinations like Velingrad or Sandanski have potential to become destinations of international importance. But, there is a lot of homework to be done. Not only in terms of infrastructure, but also in selling, branding, and createing a unique offer, differing them from others. A high risk is prevailing to lose market share, if they are not able to position themselves in the market, and to set up sustainable future strategies creatively.

Bulgaria
With more than 1000 mineral springs, the country boosts high potential for mineral water treatments. Some of them are even dating back to the roman thermal or Turkish bath culture. Depending on the water content, the offered treatments are different. Besides medical treatments, special rehabilitation and toning programs are offered. Dental services e.g. are not included in all countries insurance cover schemes. These treatments can be had at a very low cost, 15 to 20€ for initial treatments e.g.. Private dental surgeries are numerous in the bigger towns, but prices for Bulgarian citizens and foreigners can be different. Dental tourism is mainly a cross boarder phenomenon. Reason is, that dental treatments can be painful, and people do not really consider lying on a beach in such conditions as pleasant. Plastic surgery services at low prices also attract foreign tourists. The sector recently suffered from global oversupply, resulting in high investments into modern equipment, technology, additional amenities, and training of practitioners. Investors were following a trend towards providing assistance to reach an ideal beauty scheme, but the industry has always been signified by rapidly changing trend cycles.

But on the other hand, an operation costing approximately 2500 to 3000€, is already provided at double the price in Germany or the USA e.g. The Bulgarian EU accession in 2007 is giving impulse to foreign tourists from other EU countries to come for medical services or curing. German tourists can get a subsidy from their insurance, private or public, to go for treatment abroad. The English insurance system is different in structure. Clients are not covered in all necessary treatments like dental or curing. Therefore good qualities offered at low-cost are already very appealing to them. The French and Italian health systems are also not considered to be very efficient, but potential customers from these countries, do not expect good services in a former communist country. To them the offer needs to be made very appealing and luxurious.

Health Tourism Developments
The idea of traveling to another country to receive low-cost, specialized or simply better healthcare is not new, and has always been considered by people needing appropriate treatment. Modern patients have few qualms about going abroad in their search for lower-cost treatments or modern services. The greater volume of treatments being undertaken abroad has also resulted in a large number of private cosmetic surgery and health program providers getting off the ground. This is diverting the flow of money into regions outside the U.S. and EU such as Eastern Europe and Asia. Healthcare tourist profiles: Expatriates, taking heart, respiratory or plastic surgery care, Those who fly in for heart, neurosurgical, respiratory and eye care treatment only General tourists who combine a regular trip with common disease and respiratory care. A Eurobarometer study done in 2007 shows, that at the time of the study, 4% of the queried EU citizens (EU 27), had a treatment in a foreign European country. 70% believe to get their treatments reimbursed by their insurance company. More than the halve of them are ready to undergo medical treatment in a foreign country. Their motivation to travel is differing. Influenced by cultural and geographic barriers influence; it is declining with age, and higher with an increasing level of education. Motives of travel are, not to have the chance to get adequate treatment in their home country, a better quality of treatments, consultancy of a specialist, a reduced waiting time, and for only 48% tof he price on average is decisive. The query also gives results on the reasons for people not going for medical treatments abroad. 86% of them find it more convenient to receive treatment at home, 61% do not have access to sufficient information, and 49% mentioned language barriers. Interesting is, that 47% shared the opinion, of not being able to afford treatment abroad.

Global
Worldwide private sector hospitals are continuously increasing their revenues, as wealthier patients are leaving the public sector to get immediate and better treatment. These hospitals enjoy better funding, are able to charge marketdetermined fees, and therefore better treatments can be offered. Health tourism is an investment, improving a destination’s competitiveness and global image, combined with a greater sensitivity towards social actions and the environment. Sustainability and tourism must go together to receive the best economic results. Consumer patterns are also changing, and the environmental setting is a critical issue in making decisions on traveling in the future. The industry is highly fragmented, owing to the multifarious structures of providers. They can be separated into public and private clinics, private commercial firms, and tour operators. The various people involved – physicians, care personnel, public sector and private practitioners, producers and suppliers of products and services – add to the complicated fragmentation. Additionally, industry suppliers limit the competition to a handful of specialized firms and institutions. Overall, the industry has been growing at an annual average of 8 – 10% in value terms, and 15% by volume for the last eight years.

Trend cosmetic surgery
This segment of the industry, also reaching high specialization in Bulgaria is an important part of medical tourism. Globally, industry sales are rising, and the trend is to move towards a medical look. Greater attention is paid towards prevention and remedies. Following a Credit Suisse research of 2007, the current trends of this fast expanding market are: Cosmetic surgery is growing in popularity, and is no longer the preserve of the rich Nearly half of all plastic surgery procedures are carried out in North and South America. Plastic surgery is increasing in social acceptance in the USA, Mexico, Eastern Europe, and Brazil.

External motivations to benefit from plastic surgery include avoiding disadvantages from prejudice. These can be ethnic, discriminatory, direct or subtle influence of colleagues, partners or seniors at work. Internal motivations are to feel better and get rid of corporal tensions. These can be depressions, psychological complexes, anxiety, or the desire to alter specific disliked features. Other motivations include the desire to remain young and look healthy, and the hope of advancing personally in life or in one’s professional career. About three quarters of plastic surgery patients want to improve their looks and adopt a more active and healthier lifestyle. Desired benefits are emotional and psychological, such as enhanced wellbeing, feelings of self-worth and higher confidence.

Beauty and Wellness
Before taking the risk of having a surgical intervention, people try their best in receiving relaxation treatments and getting tips on their personal appearance. This trend more popular among women than men, with growing numbers among the latter though, is the key driver for the future of medical tourism. Growing disposable incomes, and the consumers’ priority to stay fit and healthy, result in a high demand for health-related consumer products. From anti-ageing crams to day-spas and non-chirurgical medical interventions to the trend of eastern treatments, diet plans, or yoga and health related remedies, the portfolio is quite varied to get tourists into wellness related hotels and resorts. Their goal is to reach a balance combining all senses:

Drivers and enablers
In a globalised world, companies are working in an increasingly open and more flexible business environment. Companies locate their businesses in areas, which benefit their efforts to cut cost most. This so called governmental race to the bottom can be beneficial to the employees and can result in higher disposable incomes. Managers are benefiting most from this effect in emerging economies, like Eastern Europe, UAE, China or India. These higher disposable incomes raise the demand for more extraordinary luxury goods, but also to save on insurance cost, and to follow the idea to travel to exotic places. The preferred purchases are cars, jewellery, or exotic travel. With longer working hours and higher income that cannot be spent during the week, a desire to escape is becoming herewith evident. The plastic surgery market is benefiting most from this trend to more luxury and self-expression, better lifestyles and a more valued, better physical appearance. The customers – not only the elderly generation, but also an increasing number of young people – are willing to spend more on health and appearance.

The small traditional customer group of the rich and famous is not the major clientele anymore; it is more middle- to lower-income classes, who are eager to live the life of their richer counterparts. About 5 years ago banks started to give loans for cosmetic treatments and plastic surgery, now the situation has changed: The industry was about to become a traded commodity by medical practitioners and credit giving institutions, but the banking crisis also limits the access to micro credits for “un-rational purposes”. The trend among people is to buy themselves into the idea of better living through surgery. A better physical appearance will result in a better job and with it a higher salary. People are used to paying for make-up and clothing, so investing into a better physical appearance is becoming a must-have, too. In recent years, the trend towards health and wellness treatments has witnessed exponential growth. International statistics estimate that the sector is increasing at 13.9% annually. The cause for this expansion is the overall escalating service demand of customers who become more focused on their health and appearance. It is not only a market to discover. The potential in Bulgaria is very high. Not just for health-, wellness-, and water treatments. It is medical tourism, that can help Hotels to receive more revenues, and with it better occupancy rates. Clinics can offer in cooperation with Hotels, their services to wealthier guests, preferring better accommodation, and can surpass seasonality with it.

How, to do it?
Traditional medical tourism destinations are operating like clusters, with integrated and naturally formed systems. In a longer time frame, the relations among the members were established, and so-called cooperational agreements were made. Packages, under a destination brand name propose a Hotel stay, and specialized clinical treatments are even including in-house consultancy and individual health and dietary programs. A hospital restructuring itself and aiming at foreign customers also needs to put some Marketing efforts in cooperation or related to the entire destination. A common phenomenon in Bulgaria is that the hardware is quite well developed, and Hoteliers put some effort into the Marketing of their Hotels. Admittedly some Hotels are reaching quite a high popularity this way. But the destination and in case of curing, medical, health and wellness tourism, the entire products are not being well promoted. Furthermore tourist areas key selling points are the attractions surrounding it, and the entertainment offer in the resort, plus the overall atmosphere. Individual Marketing budgets can be reduced, and more efficient promotion be done. Independent hoteliers need to realize the importance of their destinations name, and should know how to benefit from it.

Tourism Master planning is a tool to put all a destination can offer together, and create added-value to a resort, by forming a brand name, a conceptual idea, best-use concepts, positioning strategies and planning to coordinate and attract future investments plus the introduction of institutional efficiency. The structure of the offer is essential. It does not help much, to have compatible treatments and services, as every health destination in Bulgaria is having quality mineral water. The use of the offer needs to be defined and broadcasted. Otherwise a destination will not set itself apart from their counterparts, and with it the destination is missing an opportunity to become unique or competitive on an international level. A Kohl & Partner study on wellness tourism in Eastern Europe showed the following results: • • • • • • • • • • Incompatibilities in between the country of origin and the tourist destination An evident lack of economic behaviour Need of social laws and transboarder EU – policies to facilitate the transfer of patients Lack of transparency, insecure demand predictions and oversupply Good Chances for renowned Eastern European curing, wellness and medical tourism providers Winners have access to exuberant Marketing-, and Sales know-how and good relations to decision makers on the highest political level Certifications and cooperation’s with insurance companies Asymmetric information’s and behavioral uncertainties among smaller providers working in national markets Attractive home markets and increasing wealth Motivation to make old central systems fit for international competition Markets not covered by insurance schemes are very price sensitive

Governments can get involved into the formation of medical tourism, by including tax reductions into the national service sectors, which are of high importance. Funding can also be provided to private sector enterprises. Both the public and private sector can receive support to launch marketing strategies, to distribute their services, and if necessary to facilitate Visa procedures.

Conclusions Traditional target groups are changing, and men are also undertaking health and beauty treatments in larger numbers. Having generally higher incomes, the benefits of wellbeing and relaxation or taking on cosmetic changes for men are being more considered. Besides medical tourists, business travelers and local customers constitute high value target groups. They have tendencies to visit health and wellness centers, but they also see the potential or payoff in small cosmetic or beauty changes and personal health improvements. Reasons for this trend are busy work schedules, high stress levels, and a growing focus on personal health and wellbeing. By their nature, health clubs and clinics can also fill the void for personalized human attention. This combined with a round of golf or daily spa treatments can fit well even into a busy schedule. The plastic surgery industry is highly influenced by modern beauty standards, and high profile lifestyle media. People are eager to live a better life, and relate their wish to a change of personal appearance. Undertaking a plastic surgery operation is seen as a necessity to gain more self-esteem, social acceptance, and a better body image. The interest of the target groups is based on semi-scientific knowledge of nutrition, and the evaluation of such through self-measurement of BMI, for example. Professionally operating destinations can target these customers on regional and international levels. A common product identity is very important, to sell tourism products under a renowned and also known brand. Hoteliers and other health practitioners will benefit highly from destination management schemes putting their brand identity under the “umbrella” of one destination, controlling incoming investments and analyzing a resorts potential. An effective use of existing market potential in Eastern Europe is confronted with inherent challenges and the need to modernize. An adaptation of antiquated strategies and structures to new market conditions on national and entrepreneurial level can exploit these potentials, like some outstanding examples already demonstrate. Bulgaria can have all chances to enter into the profitable health tourism market. The homework to be done would be: • • • • Cooperate on the level of a destination Cooperation in between the tourism and health industry Foster investment into infrastructure Increase the service level

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