The Role of Hotel Industry in Medical &
Wellness Tourism
Dr. Ali A. Poorani and Ryan Poorani
Jan 11, 2013
Medical tourism or wellness tourism has been around for centuries, but its growth as a
viable, mature industry is hastening in a manner similar to the expansion the hotel
industry experienced from the 1950s to the 1980s. Propagated in 1950s and 1960s, hotel
systems reached maturation in the late 1970s, becoming an efficient and differential
industry in management systems, marketing, finance and accounting, measurement,
benchmarking, and disciplined in operations (Steve Rushmore). In this paper we address
the crucial role that the hotel industry can play in complementing medical tourism’s
positive developments.
In the U.S., national and regional hotel & lodging professional associations emerged in
early 1900s, mainly to protect lodging industry against fraud, and paralleled the growth
of the 1970s to offer a wide breadth of promotional and educational programs, as well as
legislative support (AH&LA). Today, many medical tourism companies and health
clusters are instituted around the world to aid the development and standardization of the
industry. The American Medical Association is taking the lead, partnering with
universities and frontrunners to deliver education and certification, promote best
practices, and spearhead evolution.
What does the future looks like?
Our prediction is that medical tourism will mature even faster than the three decades that
culminated in the rise of hotel industry, mainly due to today’s sophistication in
operations, system design, brand strategies, technology, and so forth. However,
maturation of medical/wellness tourism industry will not happen on its own merits, since
this industry relies heavily on many players and in some cases, an entire community. For
that reason alone, medical tourism will face many more challenges, than more defined
tourism segments like timeshares and theme parks.
Why hotel accommodations are a crucial part of the
medical tourism and wellness industry?
Hotel/lodging industry partnership is one small, yet critical piece of the development of
several segments of the tourism industry. A case in point, the U.S. timeshare industry that
commenced nearly 30 years ago (Randall S., Upchurch & Kurt Gruber) only realized
widespread success when major hotel chains, such as Marriott and Hilton partnered with
firms in the segment. With their experience in brand development, customer loyalty, and
significant resources including real estate brokers, large investors, and innovative mixed
projects’ the industry’s evolution reached its status today.
Let us begin with the Mayo Clinic’s community approach to overall patient experience
and healthcare delivery. Mayo’s number one goal is: understand human needs, design
services, products and business models to meet those needs.
(http://www.mayo.edu/center-for-innovation/what-we-do/mission-goals-and-approach).
Obviously, patients and families traveling to receive healthcare have many needs. Some
are tangibles, such as efficient transportation, lodging, foodservice, shopping, and tourist
activities. The intangibles, the cornerstone of the hotel industry culture, encompass the
experience during pre-departure, encounter, and post-departure.
A well-balanced medical/wellness tourism destination must address almost all of the
tangibles and intangibles, which is well beyond the scope of this paper. Therefore, we
explore how the lodging industry can position itself to make its services available to
medical/wellness tourists through: 1) supply of accommodations, 2) convenient and
efficient business models, and 3) innovative design, amenities, and services.
1. Supply: Hospitals and healthcare facilities need one another more than ever
before. Cost pressures force hospitals to discharge patients in a timely fashion to
hotels or homes nearby; demand for hospitality services within hospitals compel
healthcare facilities to act more like hotels; and hotel companies see opportunities
in building hotels near healthcare facilities. The interplay of these attractions
makes a perfect marriage. Hotel industry’s appetite for building hotels near
hospitals is further fueled by optimizing occupancy and financing needs:
o Occupancy: A study by Bruce Serlen (Hotel Business) stated that hotels
near healthcare facilities achieved higher occupancy during 2007
recession. This statement has been amplified by many sources, such HVS.
As a result, developers are more interested to build hotels near hospitals to
create a recession proof facility. (Bruce Serlen, Hotel Business, 02/07/09,
vol. 18, no.3)
o Financing: In a flat economy, both banks and hospitals are appropriately
interested in financing such projects. Mark Laport, CEO of Raleigh, NC –
based Concord Hospitality stated, “With U.S. new hotel development at a
near standstill, one of the few niches where new properties continue to get
built is the hospital-adjacent hotel market. Developers of these hotels can
pitch financiers on their built-in customer base and, in many cases, make
side agreements with lodging-starved hospitals that may procure assets
such as free parking or below-market-cost land.”
http://www.travelweekly.com/Travel-News/Hotel-News/Hospitaladjacent-hotels-get-built-amid-development-standstill/
2. Convenient and efficient business models: Lodging operators and healthcare
facilities could integrate in at least in three ways.
o First, the most common model in the U.S. in which hotels and hospitals
arrange memorandum of understanding (MoUs) to collaborate, sometimes
in the form of providing discounted rates, transportation, concierge
services, etc.
o Second, hotels and hospitals are housed together in the same building.
Either the hospital devotes a few stories to patient/family rooms
(University of Michigan’s Med Inn, Bumrungrad International Hospital of
Thailand) or a major hotel allocates a floor or two to a wellness/medical
care facility (Shilla Hotel, Seoul, South Korea).
o Third, hotel and hospital build a mixed project under the same ownership.
These facilities are strategically situated to accommodate the hotel’s
patient needs, the needs of their families, and needs of transient guests
(Grand Resort Bad Ragaz, Switzerland).
These models are already established around the world, we do not yet have
enough research and analytics to verify the advantages and disadvantages that
each model provides, as well as the specific needs of various patients and their
families, and the economic viability of each of the models. For now we wait and
see what model will emerge that best matches the advantages of each destination
and the needs of their customers.
3. Innovative design, amenities, and services: While developers may rush to build
hospital-adjacent hotels, we have not yet designed a brand that is optimal for
medical/wellness tourism travelers. Many challenging issues remain that need
further research. The most important of these are, building modifications,
amenities modification, and service modifications.
o Building modifications: The lodging industry has not yet developed an
efficient room design that can fully satisfy the needs of patients, business
and leisure travelers. A hotel room resembling a hospital-room is,
undoubtedly, less appealing to business or leisure customers yet must
thoroughly accommodate ADA requirements by both removing
o
o
architectural barriers, such as accessibility to all services including pool,
sauna, etc., and providing auxiliary aids and telecommunication devises.
Such an efficient design remains to be seen. Furthermore, entrances to
facilities and guest movement within the property must be designed
appropriately that are convenient for all target customers’ needs.
Amenities modification: What are the most desirable amenities that
patients must have? To my knowledge there is no valid data that considers
the needs of all types of guests as well as customer preferences. Logically
the following amenities seem smart, but are they?
 Adjustable beds
 Nurse call systems
 Wi-Fi
 Bedside controls
 Individualized TVs
 Hot bath
 Individually controlled air
 Bathroom amenities suitable for the needs of recovering patients
 Family needs, such as microwave, refrigerator, washing machines,
etc.
Service modifications: This is one of the most challenging factors that the
hotel industry must face partnering with hospitals or wellness centers.
Hotels are one of the most important touch points in a patient encounter
phase. To provide seamless services to all types of guests and particularly
traveling patients, hotels must consider the following:
 Quick check-in process (e.g., at the airport)
 Efficient concierge
 Translators
 First aid training
 Prescription delivery
 Coordinators
 24-hour room service
 Shopping services
 Shuttle services
 All-inclusive pricing
 Nursing and dietitian staff
All of this requires substantial investment in staff training and recruitment activities. The
majority of hotel employees are attracted to this industry without major background to
deal with patient needs. Research is needed to explore the cost/effectiveness of such
training efforts. Additionally, we need to explore what type of employees will succeed in
this segment? What characteristics are needed to model performance? What credentials
are necessary? Finally, what services are a must have?
In conclusion, though the industry, as a defined segment, appears more viable than ever
before, there are many challenges ahead, among them, community engagement and
partnerships, large financing requirements, management systems, distribution channels,
legal issues, marketing and branding, standardization, and measurements/benchmarking.
All these challenges provide many opportunities to all parties involved, which we hope to
witness as other industries have achieved before us.
About the Authors
Dr. Ali A. Poorani, Director Hospitality Associates for Research & Training (HART) is
Associate Professor of Hospitality Leadership and Entrepreneurship at the Lerner College
of Business & Economics, at the University of Delaware. Poorani@udel.edu.
Ryan Poorani is a Business Development Intern and Project Manger at Keck Medical
Center of University of Southern California. He has also developed an outlet-wide
training program for new employees to foster buy-in and improve new-employee
satisfaction at the Ritz-Carton Hotel Company in Los Angeles, California.
Poorani@usc.edu.