The government’s intention to turn Armenia into a regional healthcare services center/hub was somewhat clarified last Friday, 15 August 2008.
According to Armenpress news agency, Health Minister Mr. Haroutun Koushkian announced the 7-8 healthcare categories which the future center/hub will cover. These are: Cancer, cardio-vascular diseases, collection and transplantation of bone marrow cells, ear implants, infertility, rehabilitation, and Stomatology.
According to the Minister, the selected 7-8 categories are those in which Armenia is already strong and has the ability, the resources and the personnel to offer first-class treatment. He also indicated that the regional center/hub would be established in 3 to 5 years from now.
The Rise of the Medical Tourist
Projects such as Armenia’s regional healthcare services hub are in response to major current trends such as globalization, increased population mobility, and the growing demand for inexpensive medical treatment which in turn is connected to rising life expectancy, growing costs of medical treatment, privatization of health care in most western countries, etc. Many people now seek medical care abroad; either because the appropriate treatment is not available at home or it is too expensive. The difference between prices of treatment at home and abroad is usually significant enough to justify travel-related expenses.
The center/hub strategy is based on the concept of “industry cluster”, a network of complementary organizations (suppliers, distributors, affiliated services, etc.) that are usually in close proximity to each other and are able to increase their productivity thanks to certain network dynamics. A cluster may grow naturally such as the medical cluster in Massachusetts, U.S.A., or can be established according to a preconceived plan, in which case it follows a socio-economic development rationale.
Singapore’s medical hub has probably been the most successful regional initiative in recent times. Launched in 2002-03, SingaporeMedicine has concentrated on cardiology, gynecology, orthopedic surgery, oncology, otolaryngology, urology, neurosurgery and ophthalmology. It has targeted medical tourists in the region (Japan, Australia, etc.) and beyond. Although it is called “medical” hub, Singaporean authorities have tried to position the hub as more than a place for the treatment of illnesses. Thus other health and well-being services have been integrated into the overall offering.
President Serge Sargsian, Prime Minister Tigran Sargsian and Minister of Economy Nerses Yeritsian seem to be very much inspired by the Singaporean experience (in general as well as in this specific case). They are not however the only ones.
Singaporean initiatives are usually emulated by certain East Asian countries namely Malaysia, Indonesia and Thailand, as well as West Asian countries such as Dubai and Qatar. In the case of medical hub, India is also in the race. Several competing projects, mainly private sector initiatives, have been undertaken in New Delhi, Bangalore, Chennai, and elsewhere in India.
A Long & Rocky Road Ahead
The designation of the future hub’s 7-8 specialization areas is certainly a step forward but there are still many issues that need to be addressed. These range from a clear analysis of potential competitors (the other hubs for instance), to the question of location (Dilijan was selected for the regional banking center, so maybe Jermuk?), independent and preferably international assessment and accreditation of hospitals, organizing the legal and regulatory environment, clarifying the governance structures of hospitals and clinics, and fundamental problems such as corruption. It is difficult to imagine a first-class healthcare hub with doctors, nurses and almost every other hospital staff functioning on the basis of kickbacks and connections. Other issues that need consideration:
1.
The expected benefits and costs of the future hub: It is important to know how many medical tourists will be expected as well as how much the project will benefit different components of the hub (medical professionals, medical schools, research institutes, travel agents, hotels, etc.).
On the other hand, I guess this project will lead to further commercialization of healthcare in the country; a subject that warrants public debate. What are the guarantees that our limited resources will not be allocated in favor of medical tourists, to detriment of the local population? The question of citizen’s continued access to medical care needs to be examined.
2.
Even if, according to the Minister, the medical professionals in the 7-8 areas of specialization are truly first-class, the quality and readiness of the future hub’s other components remain uncertain.
The success of a hub/cluster depends, to a great extent, on the quality of all the components as well as the level of their interactions and collaboration. In this case, we are talking about the hospitals, medical schools, the airport, travel agencies, insurance companies, pharmacies, etc. Are they also “first-class”? As far as the medical schools are concerned, they are definitely not.
Other than our flagship institution, Mekhitar Heratsi Yerevan State Medical University (YSMU), whose being first-class is highly debatable, I think it is outrageous to see the existence of schools such as Haybusak University and Saint Theresa Medical University in Armenia. These “universities” would have been classified as diploma mills and shut down anywhere else in Europe.
The degrees delivered by Haybusak even enjoy state accreditation thanks to privileged relations that the founding family entertains with certain politicians and of course with the Ministry of Education and Science. The Ministry of Health that plans to create a first-class healthcare hub has also turned a blind eye on these medical diploma mills.
3.
The question of service-oriented culture and efficient and professional management needs to be taken into consideration as well. The regional hub cannot succeed only based on excellence in medical treatment. In other words, contrary to Soviet era thinking, “soft skills” are as essential as “hard skills”. Patients, particularly those coming from outside former Soviet Union, will normally be used to higher service standards and better organized operations.
We have already experienced a similar gap in tourism and hospitality sector particularly in regards to western tourists. The lack of appropriate training, both at managerial and operational levels, is usually mentioned as the main source of the problem.
In the higher education sector, the experience with foreign students has even turned into a misadventure and in the case of the Indian students at YSMU into a pure disaster. What is there to assure us that the experiences of future foreign patients will be better than those of past and current foreign students?
These concerns however do not mean that I am opposed to the project. On the contrary, I believe services may be a more viable option for the Armenian economy than say industrial manufacturing. And healthcare services may indeed be one of promising export sectors. To succeed, however, I think a more comprehensive approach, and more rigorous and extensive planning and preparation will be needed.
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According to Armenpress news agency, Health Minister Mr. Haroutun Koushkian announced the 7-8 healthcare categories which the future center/hub will cover. These are: Cancer, cardio-vascular diseases, collection and transplantation of bone marrow cells, ear implants, infertility, rehabilitation, and Stomatology.
According to the Minister, the selected 7-8 categories are those in which Armenia is already strong and has the ability, the resources and the personnel to offer first-class treatment. He also indicated that the regional center/hub would be established in 3 to 5 years from now.
The Rise of the Medical Tourist
Projects such as Armenia’s regional healthcare services hub are in response to major current trends such as globalization, increased population mobility, and the growing demand for inexpensive medical treatment which in turn is connected to rising life expectancy, growing costs of medical treatment, privatization of health care in most western countries, etc. Many people now seek medical care abroad; either because the appropriate treatment is not available at home or it is too expensive. The difference between prices of treatment at home and abroad is usually significant enough to justify travel-related expenses.
The center/hub strategy is based on the concept of “industry cluster”, a network of complementary organizations (suppliers, distributors, affiliated services, etc.) that are usually in close proximity to each other and are able to increase their productivity thanks to certain network dynamics. A cluster may grow naturally such as the medical cluster in Massachusetts, U.S.A., or can be established according to a preconceived plan, in which case it follows a socio-economic development rationale.
Singapore’s medical hub has probably been the most successful regional initiative in recent times. Launched in 2002-03, SingaporeMedicine has concentrated on cardiology, gynecology, orthopedic surgery, oncology, otolaryngology, urology, neurosurgery and ophthalmology. It has targeted medical tourists in the region (Japan, Australia, etc.) and beyond. Although it is called “medical” hub, Singaporean authorities have tried to position the hub as more than a place for the treatment of illnesses. Thus other health and well-being services have been integrated into the overall offering.
President Serge Sargsian, Prime Minister Tigran Sargsian and Minister of Economy Nerses Yeritsian seem to be very much inspired by the Singaporean experience (in general as well as in this specific case). They are not however the only ones.
Singaporean initiatives are usually emulated by certain East Asian countries namely Malaysia, Indonesia and Thailand, as well as West Asian countries such as Dubai and Qatar. In the case of medical hub, India is also in the race. Several competing projects, mainly private sector initiatives, have been undertaken in New Delhi, Bangalore, Chennai, and elsewhere in India.
A Long & Rocky Road Ahead
The designation of the future hub’s 7-8 specialization areas is certainly a step forward but there are still many issues that need to be addressed. These range from a clear analysis of potential competitors (the other hubs for instance), to the question of location (Dilijan was selected for the regional banking center, so maybe Jermuk?), independent and preferably international assessment and accreditation of hospitals, organizing the legal and regulatory environment, clarifying the governance structures of hospitals and clinics, and fundamental problems such as corruption. It is difficult to imagine a first-class healthcare hub with doctors, nurses and almost every other hospital staff functioning on the basis of kickbacks and connections. Other issues that need consideration:
1.
The expected benefits and costs of the future hub: It is important to know how many medical tourists will be expected as well as how much the project will benefit different components of the hub (medical professionals, medical schools, research institutes, travel agents, hotels, etc.).
On the other hand, I guess this project will lead to further commercialization of healthcare in the country; a subject that warrants public debate. What are the guarantees that our limited resources will not be allocated in favor of medical tourists, to detriment of the local population? The question of citizen’s continued access to medical care needs to be examined.
2.
Even if, according to the Minister, the medical professionals in the 7-8 areas of specialization are truly first-class, the quality and readiness of the future hub’s other components remain uncertain.
The success of a hub/cluster depends, to a great extent, on the quality of all the components as well as the level of their interactions and collaboration. In this case, we are talking about the hospitals, medical schools, the airport, travel agencies, insurance companies, pharmacies, etc. Are they also “first-class”? As far as the medical schools are concerned, they are definitely not.
Other than our flagship institution, Mekhitar Heratsi Yerevan State Medical University (YSMU), whose being first-class is highly debatable, I think it is outrageous to see the existence of schools such as Haybusak University and Saint Theresa Medical University in Armenia. These “universities” would have been classified as diploma mills and shut down anywhere else in Europe.
The degrees delivered by Haybusak even enjoy state accreditation thanks to privileged relations that the founding family entertains with certain politicians and of course with the Ministry of Education and Science. The Ministry of Health that plans to create a first-class healthcare hub has also turned a blind eye on these medical diploma mills.
3.
The question of service-oriented culture and efficient and professional management needs to be taken into consideration as well. The regional hub cannot succeed only based on excellence in medical treatment. In other words, contrary to Soviet era thinking, “soft skills” are as essential as “hard skills”. Patients, particularly those coming from outside former Soviet Union, will normally be used to higher service standards and better organized operations.
We have already experienced a similar gap in tourism and hospitality sector particularly in regards to western tourists. The lack of appropriate training, both at managerial and operational levels, is usually mentioned as the main source of the problem.
In the higher education sector, the experience with foreign students has even turned into a misadventure and in the case of the Indian students at YSMU into a pure disaster. What is there to assure us that the experiences of future foreign patients will be better than those of past and current foreign students?
These concerns however do not mean that I am opposed to the project. On the contrary, I believe services may be a more viable option for the Armenian economy than say industrial manufacturing. And healthcare services may indeed be one of promising export sectors. To succeed, however, I think a more comprehensive approach, and more rigorous and extensive planning and preparation will be needed.
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