Health Tourism Provider Qualification and Compliance

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Medical and dental tourism facilitators and care coordinators must develop and execute and continually monitor and improve sourcing policies that define the minimum standards each type of supplier is expected to meet and comply with in order to qualify as an approved supplier. The standards they integrate should include social, ethical and environmental principles. The basic sourcing principles of licensure, training, credentials, privileges, experience, and capacity are generally supplemented by other requirements such as destination security and attractiveness, supplier financial health and sustainability, internet and medical records and patient financial information security and privacy management, and customer service, to build supply chain resilience.

Who authored this article?

The responsibility for provider qualification and compliance collaboration rests with the facilitator and suppliers.

  1. Marketing agency of the provider
  2. Procurement advocate of the patient
  3. Internet marketing platform that creates an online catalog of suppliers for consumer self referral (e.g., Medigo, Placidway, et al)

In today’s article, my focus is on the second: the facilitator as procurement advocate of the patient.  In this role, all decisions, criteria to establish competency and qualifications is focused on the needs of the patient/client of the facilitator. In this role, they are paid for their professional services by the patient to act as ombudsman and guide. They should not be paid a kickback or fee split by the healthcare facility or practitioner for the brokering of health services referrals.

How Do Medical Tourism Facilitators and Care Coordinators Currently Manage the Process of Supplier Qualification and Compliance?

Medical tourism facilitators and care coordinators often develop rather complex supply chains with experiential products and health services sourced from all over the world.

Their networks of approved providers sometimes number hundreds of suppliers.

  • Health services suppliers include, inter alia: hospitals, clinics, same day surgery centers, physicians of many specialties, dentists, therapists, and other ancillary providers.
  • On the accommodation side, they source hotels, guest houses, bed and breakfast outlets, lavish spas and resorts, inexpensive hostels, thermal springs and hydrotherapy accommodations,  and mixed use facilities.
  • On the ground transportation side, they source limousines, car and driver services, shuttle vans, and sometimes even ambulances.  The complexity and extent of sourcing arrangements increase the likelihood and negative impact of supplier risks.

To manage these risks, facilitators and care coordinators must develop, execute, negotiate contracts, and continually monitor and improve sourcing policies that define the minimum standards each type of supplier. This process is expected at a minimum for suppliers to meet and comply in order to qualify as an approved supplier.

The standards they integrate should include competency, social, ethical and environmental principles. The basic sourcing principles of licensure, training, credentials, privileges, experience, and capacity are generally supplemented by other requirements such as destination security and attractiveness, supplier financial health and sustainability, internet and medical records and patient financial information security and privacy management, and customer service, to build supply chain resilience.

Health and wellness tourism is essentially the medical and dental and preventive health supply chain business.

And just like in other sectors, for health and wellness tourism and medical and dental travel, there should be a high degree of commonality among responsible sourcing policies and minimum supplier standards. This is because most facilitators and suppliers must abide with similar regulatory requirements such as fighting against modern slavery and corruption, antitrust prevention and pro-competitive business policies, fraud and abuse mitigation, truth in advertising and consumer protections,

Commonalities also exist in the methodologies used to evaluate suppliers’ practices and seek assurance that they align with the facilitators’ and care coordinators’ policy and values. All of these touchpoints are integral parts of the facilitators’ and care coordinators’ quality management programs and must be documented and adhered to if they seek to achieve ISO 9001:2015 certification or pass underwriting review to obtain professional liability insurance. Even if they don’t seek certification, they need these processes as part of their safety and quality internal infrastructure.

The problem is, most facilitators and care coordinators have no clue how to do this. Or, alternatively, they have a clue but haven’t put much time and effort or consideration about how to plan, develop, execute or benchmark such a system. Or, worse, they know they should, they know how or how to get help with the task, but lack the capital resources to get it done.

My thoughts on the matter: in any case, the facilitator or care coordinator is not yet ready to commence operations and professionally involve themselves in health matters of clients.

Frequently we find new startup facilitators and care coordinators significantly under-capitalized and not trained that such a process is crucial to their business. As a result, they fail to build a robust quality management system and never get around to addressing any formally-developed, written, process, policy or standards and key performance indicators in a checklist or other tool.

They commence operations and “go live” with a supplier network development without a minimum documentation set for the process of supplier qualification and compliance. Most start with a website, a cell phone, and head straight into the work of sourcing providers with any practitioner, facility or ancillary provider willing to work with them.

Very few medical tourism facilitators and care coordinators are capitalized by private equity or venture capital investors. As a result, if they don’t ask for enough capital to establish this process and documentation for provider qualification and compliance, the investors are at risk in the event of a substandard outcome. This is probably a hint as to why the VC and PE investor world hasn’t invested in medical tourism facilitator businesses.

The medical tourism facilitator business is an investment opportunity that needs to mature to the point that avoidable business risks are mitigated. Investors are wary of opportunities that paint a bulls-eye target on their backs by aggressive tort lawyers seeking to discover weak spots in the duty of care.

The goal and purpose of this article

My goal in this article is to establish the awareness of the need for these written policies, procedures, standards, qualifications, benchmarking KPIs, and outcomes monitoring and measurement systems into a process of supplier qualification and compliance before interviewing and negotiating contracts with health delivery, accommodation and ground support suppliers.

But unlike many of my posts, I cannot share such checklists that are used by our firm as they represent hundreds of hours of proprietary development, consideration and thousands of dollars of investment and continual improvement.

Each facilitator and care coordinator firm must develop these standards for itself, whether it is developed by the owner, or a consultant is engaged to assist in the development of a unique rubric under which that facilitator or care coordinator will conduct business and be evaluated on the basis of quality, competency, preparedness, and professional liability.

What are the Common Problem Areas/Pain Points in Managing Supplier Qualifications?

Many facilitators and care coordinators struggle when they evaluate supplier qualifications. Often, they meet potential suppliers in 3-20 minute B2B meetings and medical tourism industry events.

Without the entire rubric completed and committed to memory or some other memory aid, they get caught up in discussions and enthusiasm in the moment and find themselves unprepared and unfiltered at the time they invite the supplier to tender. As a result, they give mixed messages to the suppliers. They fail to present their minimum standards to the supplier as a prerequisite to contract and supply.

This leads to the “8 Deadly Lean Wastes” –  DOWNTIME (Defects, Overproduction, Waiting, Not utilizing talent, Transportation, Inventory excess, Motion waste, and Excess processing).

  • They waste time on suppliers who don’t qualify.
  • They end up with too many suppliers they won’t use.
  • They wait for credentials and other information and documentation for providers to whom they will ultimately never make referrals.
  • They miss opportunities to discover the right suppliers.
  • They waste time and travel (whether paid by themselves or hosted) on fam tours and site inspections of unqualified providers and suppliers in places that clients will never agree to travel.
  • They put too many supplier options on their website and in their network each of which must be periodically reverified and re-credentialed and privileged and contracts updated and renewed.
Another pain point is the qualification fatigue for suppliers.

With so many facilitators reaching out to connect and potentially refer patients or accommodation guests, suppliers can be easily fatigued by the exchanging of data, interviews, site visits, contract negotiations, and other qualification fatigue that they simply do not or cannot keep up. This drives up delays in processing. The problem on this side is that most suppliers will contract with almost any facilitator or care coordinator, or taxi driver, or travel agent who they believe will be a potential source of international patient referrals.

Until Higowell was developed, each facilitator and care coordinator pursue supplier compliance assessment individually.  The Higowell marketplace platform could easily serve as a repository for much of the information that would be requested to reduce the duplication of qualification efforts and costs for the suppliers and facilitators and care coordinators. the only thing preventing this is that the users on both sides of the marketplace have yet to decide to do it. I am hopeful that this will be discussed and decided at the Higowell User Group meeting in December 2018

Supplier audit is a typical example of a duplicate requirement. To alleviate this pain point, an industry forum could be developed for health and wellness tourism and travel much like AIM Progress has developed seek to promote responsible sourcing by enabling mutual recognition of audits conducted by other members.

AIM-PROGRESS enables pre-competitive collaboration between peer companies to share experience, standards setting collaboration, mutual recognition, capability building, human rights due diligence, to ensure implementation of the UN Guiding Principles of Business and Human Rights (Ruggie Framework, 2011) and enable facilitators and care coordinators and suppliers to prevent and address human rights infringements in developing and developed countries where patients will be referred for health and wellness treatments.

The framework focuses on the promotion and protection of all human rights, civil, political, economic, social and cultural rights, including the right to development. It is also known by the name, “Guiding Principles on Business and Human Rights: Implementing the UN “Protect, Respect and Remedy” Framework.” It is easily located online and should be referenced into any such quality management system and integrated into any policies and supplier qualifications and compliance standards of every facilitator or care coordinator.

What are the Risks Associated with Suppliers’ Noncompliance?

Supplier noncompliance can affect a medical or dental tourism facilitator’s brand in many ways. But worse, it can affect the patient’s outcome and diminish customer delight with the experience of a lifetime.  Worldwide, there is a growing trend of businesses and their owners being held accountable, at least by nongovernmental organizations and consumers, for the acts and outcomes of their entire supply chain.

This accountability poses real challenges for business owners, their investors, their suppliers and their patients all of whose reputations are reliant upon the conduct of suppliers. Facilitators and care coordinators have little control over this. Their recourse is to cancel the contract or let it stand and send no referrals.

The situation is exacerbated if the contracts they sign with suppliers are drafted to the suppliers benefit.

  • Many facilitators and care coordinators rely on supplier contracts because they lack knowledge and capital to pay attorneys to draft contracts appropriate for an ombudsman and advocate of the patient.
  • They agree to contracts drafted by the suppliers that were intended for marketing agency representatives; not patient advocates.
  • This places the facilitator in the untenable position of stating a mission of advocacy of the patient, and a contract that places them in the role of advocacy of the supplier.

As such, the compliance standards and policies and procedures are never referenced in the contract between facilitator and supplier, and any breach or noncompliance is not a breach of contract because it was never negotiated into the agreement in the first place.

In addition to reputational risks, there are legal and regulatory risks associated with supplier noncompliance.

For instance, facilitators and care coordinators who accept kickbacks and fee splits, are exposed to the risks of bribery and corruption in their supply chains, which can trigger severe consequences.

Facilitator and care coordinator firms should have in place systems to manage compliance with antibribery laws, such as the UK Bribery Act or the U.S. Foreign Corrupt Practices Act, or the rules and regulations in Canada, Germany, or Australia, or other countries as may be applicable. Fines imposed on companies that are convicted can reach hundreds of millions of U.S. dollars.

It defies all logic that most facilitators and care coordinators blindly accept contracts that include bribes, kickbacks and fee splits or other touts in exchange for referral steerage. More training and education for facilitators is needed on the matter of regulatory compliance associated with referral brokering for health services.

Is There a Need for a Common Supplier Qualification Repository that is Managed Centrally? Is this Area Prime for Product Innovation?

To manage supplier compliance effectively, there is an obvious need to be able to access all supplier information in one place. Facilitators and Care Coordinators often face the challenge of having supplier data split among multiple systems and departments, vendors and locations. A siloed supplier qualification system results in little visibility regarding who the suppliers actually are and how they perform globally. Technology is a key enabler for mastering and connecting supplier data. That’s where Higowell differentiates itself from any other medical tourism business management software invention currently available. It already has the ability to do this. The database need only be populated by the users and suppliers from the marketplace.

What are the Advantages of a Common Supplier Qualification Repository within a Company?

New legislation is being introduced regularly to place demands upon organizations to be more transparent about issues in their supply chain and about what they are doing to address them. For instance, the UK Modern Slavery Act and the California Transparency in Supply Chain Act require companies to disclose their efforts to eradicate slavery and human trafficking from their direct supply chain. Moreover, the French Due diligence of corporations and main contractors regulation requires businesses to publish and implement a surveillance plan to prevent serious violations of human rights, fundamental freedoms, and the health and safety of people and the environment. Medical tourism facilitators and care coordinators would be under a gross miss-assumption to believe that their business is so small and insignificant that they would not be held accountable to such regulations if their business has a nexus in any country where such regulations have been promulgated.

To abide with these requirements, facilitators and care coordinators must equip themselves with the ability to consolidate supplier information and standings, and report outcomes and noncompliance. A common supplier qualification repository such as the marketplace platform can certainly help them comply with these requirements.

Questions and comments are welcome.

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