Journey For Health

Journey For Health
June 17, 2017
Sergey Shpilko, President of the Russian Union of Tourism Industry, on Russia’s chances of finding its own niche on the global market of medical tourism
– Sergey Pavlovich, in this issue we are going to talk about the development of medical tourism in Russia and try to do so with optimism. But what is your professional view, is the patient more alive than dead? And is he still waiting for a healthy bright future? 

– Medical tourism in Russia is clearly of enormous potential and can be extremely successful. I’m saying this as a man who spent eight years in the Science Research Institute of Economics affiliated to the State Planning Committee of the USSR. The Soviet Union, certainly, was behind the West in many ways, but we had “brand” achievements as well.  Everyone knows about the Soviet space industry, ballet and hockey, but few know that the health resort and spa complex is alongside, as well as the entire sphere of internal tourism of the USSR. The facilities of the Central Board for Tourism and Trips of the All-Union Central Trade Council provided their services for millions of people each year. We can say, it was the biggest tour operator in human history! And the room capacity of Soviet health resorts in some periods exceeded that of the hotels. This never happened anywhere else in the world. 

Not only were the scales unprecedented but also the Soviet school of balneology itself. The western understanding of health resorts is that they are either spa centres or some kind of country hospital with a partial use of natural factors. The Russian system of health resort treatment, in which dozens of doctors of various specializations work in one health resort, is a unique phenomenon. By the way, our prices are still competitive. Consider for instance the Kislovodsk health resort with its pressure chamber. One course of treatment with such a pressure chamber in Europe will cost more than the whole trip to our Kislovodsk. 

– But with all these advantages, we still do not see a crowd of foreign tourists in Russian health resorts. 

– Customers from near abroad come somehow, but in order to attract tourists on a massive scale, we need to work on the product of course. It needs to be promoted, packaged, specialized for the foreigners also. There are not so many warm sea resorts in Russia, but the whole territory of the country is rich with natural therapeutic factors. The regions holding leading positions for the development of health resort and spa complex include Krasnodar Region, Crimea and Stavropol Region, followed by Moscow Region, Bashkortostan, Tatarstan, Altai Territory, Samara Region and St. Petersburg, with its resort area. While Altai health resorts are already well known, few people know about Bashkortostan health resorts for instance. Kamchatka, Magadan, Khasan Region, Primorye Territory have wonderful health resorts ... Resources are everywhere.

– Does Russia have a chance to occupy its niche in the world health tourism market? Or are all the seats occupied already? 

– At the moment, the world medical tourism industry is in a phase of rapid growth. Not long ago the Russian Union of Tour Operators organized a study tour to Catalonia. What we saw was astounding. The development of tourism in general and of health tourism in particular is a major focus of Catalans. They solved all the problems with their coastline as well as with the cultural content of recreation in the region, and now they even have to limit the tourist flow to Barcelona. We’ve been in the magnificent centre of Plastic Surgery, in perinatal and ophthalmology centers, in other advanced clinics. And everywhere the interaction with foreigners is excellently organized. We saw buses with German tourists near one of the centres. We asked how many beds they had, and it turned out to be less than a dozen. The process is well established, and after some surgical procedures people go home the same day and undergo rehabilitation under the remote control of the clinic’s specialists. It is a great achievement to bring the work with foreigners to such a level. 

The most excellent examples of medicine in its export execution are demonstrated in Germany and Israel. Italy, Greece and China are promising. What a medicine is in Cuba now! The Cubans have gone far ahead, especially in the sphere of oncology. Or let us consider Portugal. I have recently talked to colleagues from the Parkinson’s Disease Association. They found out that it is in Portugal that one of the world’s best clinics for the treatment of this disease is located.

World market participants interact, learn each other’s experience, make serious investments in the health-care industry and continually improve themselves. It is high time for Russia to become part of this global process, but we still cannot get somewhere and readjust ourselves. The industry is serious and promising. It has held its positions mainly due to the efforts of chief medical officers of health resorts, who do their best, although the state does not care much about them. Unfortunately, for all these years, our health resort and spa complex was in a situation of a hard done Cinderella. It’s a bitter truth.

Everyone knows about the Soviet space industry, ballet and hockey,
but few know that the health resort and spa complex is alongside,
as well as the entire sphere of internal tourism of the USSR. 

– What do you think should be done to get off the ground? 

– Something is already being done. There has been held the Presidium of State Council for Health Resort Development, where important decisions were taken, including the establishment of a Health Resort Registry, their obligatory classification, etc. However, it was decided to return the resort fee. In fact, health resorts and hotels were asked to share their income with local budgets. It is easy to imagine what this can lead to when most market players have a budget deficit. Furthermore, for health resorts there will be introduced land and property taxation on a cadastral evaluation basis, thus increasing the financial burden on health resort and spa complexes.    
Foreigners will have to pay three fees: visa fee, visa centre fee and resort fee, and for each day of stay there will be different rates, depending on the region, in case the fee is entered by the majority of the regions. A more inhospitable solution is difficult to think of. 
The first thing to do, therefore, is to carefully analyze the economy of each health resort and spa complex, its financial indicators, the payback period for investments, and then to secure health resorts from increased fiscal burden and exactions of different level.

The second thing is to gather and listen to industry representatives, doctors and managers of health resorts, investors. What are they anxious about, what help can be provided for them? It would be useful to learn about the successful experience of health resorts, which implemented up-to-date management technologies. We have lots of these: Belokurikha, “Plaza” in Kislovodsk, Karelian “Kivach”, health resorts of “Ulyanovskkurort”, Amaks Hotels & Resorts, СSTE (holding), health resorts of the Directorate for RF Presidential Affairs, including Volzhsky Utes in Samara region, and many others.

A further problem of the Russian hospitality industry has traditionally been considered high seasonality. But it is solved by a clear positioning of services. For example, in Mineralnye Vody, year after year they are trying to build a road to the sea. On the one hand, the desire is understandable, and on the other hand, they must understand: they were very lucky to have no sea nearby. This helps to position yourself clearly in the market. The whole travel industry is holding on one simple question: “Why do we have to go to you?” The answer must be as simple and clear as the question; it does not require further reasoning. If you have a stomach problem – go to Mineralnye Vody, locomotorium problems – go to Staraya Rusa. If your children are sick – Anapa or Eupatoria, which are the two main children’s resorts with the shallow water sea and pediatrician staff. 

In general, as a person who has represented the industry for many years, I can say, it’s certainly good when they help you, but the most important thing is that they should not impede. Just let people work, and if you want to help, organize ads. 

Why was the Ministry of Health Care, which is in charge for spa treatment, never puzzled with its popularization? These functions have now been entrusted to Rostourism, but treatment including health resort treatment among others, should be promoted primarily via medical channels. Previously, it was the physician at the clinic who prescribed the patient a trip to this or that health resort. What do the doctors now know about sanatoriums and resorts? 

Did you see any posters at the hospital at least telling about health resorts? Just anything? So, if you are introducing a resort fee, you need to spend the obtained money firstly on popularization of treatment in our health resorts at low season. And, of course, there is a need for tax relief on land and property. 

Unfortunately, for all these years, our health resort
and spa complex was 
in a situation of a hard done Cinderella. 
It’s a bitter truth.

– You noted that our prices are quite competitive in the world market. But in the domestic market, the average cost of travel is still high, and not many people of our country can afford themselves to visit health resorts for a full cost.

– Recreation and tourism are the most elastic item of consumer spendings. If incomes decline, it is the first to decrease, as opposed to spending on rental payments or food. But curtailing recreation expenses, we would rather refuse from beach recreation or skiing than the rest for children or a trip for treatment. Health is above all for us. What about pricing, this issue is solved by a smart work with seasonal discounts.

There was a similar problem with the hotels in Moscow. During summer and on holidays with the departure of business travelers, the load was rapidly decreasing. At that time it was considered, there was no turning point, it’s the city of business. Nothing of the kind! Five years of mutual work with hotel directors, and the picture has changed. Hotels made pricing policy more flexible, offered discounts on time, and in addition, in the capital there appeared a bright series of events, modern services, and tourists started coming to the capital for the weekends, for the New Year and May holidays.

Discounts should be offered not when people have not already arrived and the rooms are free, but in advance, you should explain in advance why it’s good to come for treatment off-season. I haven’t been on full vacation for years, but sometimes I leave for a few days to a health resort, and I’m trying to do it in the low season. The weather still does not prevent you from resting in fresh air, and the service is even better at this time because there are few people and you can talk to your doctor as much as you need. Critics usually compare prices of Russian health resorts to the prices for recreation without treatment abroad. But keep in mind that in Russia you are not only taking vacations, but also treatment, while the similar treatment abroad is likely to cost several times more. 

– One of the main claims for the Russian health resorts remains their weak service. People accustomed to recreation abroad perceive them as obsolete, and the heads of many health resorts seem to underestimate the importance of this issue, preferring to work in the old-fashioned way. 

– Yes, the service needs to be leveled up. The classification of health resorts will help to some extent. But better service is one of the easiest challenges we face. The solution is easier than effective treatment, and it must be the first thing to focus on. And then, if you get to a good health resort, you’ll have no time for rest. I remember when those tragic events occurred in Chechnya in the 1990s and terrorist attack had already taken place at Kavminvody, contrary to expectations, the loading of local health resorts did not fall to the ground, but remained at a 50-60% level. It seems inconceivable, but if one faces a dilemma: whether to go under the knife of a surgeon or to try curing with natural therapeutic factors, his motivation is very strong. The service is, of course, important, but this opportunity to go to a trip for health in any time of the year and to any region of our country is of much more importance.

Natalya Lukashkina