Cleveland Clinic next year will open a 364-bed multispecialty hospital in Abu Dhabi in one of the most ambitious overseas ventures undertaken by a U.S. health care system, Robin Respaut reports for Reuters.
The Clinic has been treating well-known Middle Eastern dignitaries for years and already helps manage the Sheikh Khalifa Medical City acute-care facility in Abu Dhabi. However, the expansion marks the first time a hospital in the region will bear Cleveland Clinic's name. Marc Harrison, former chief medical operations officer in Cleveland Clinic's Ohio facility, will lead Cleveland Clinic Abu Dhabi.
Cleveland Clinic CEO Toby Cosgrove says the move will guarantee new revenue streams, which have been cut by the millions in anticipation for public and private-sector spending cuts under the Affordable Care Act. "We look at it as our petrodollars coming home to Cleveland," he told Reuters at a health summit last week, adding, "It's money coming back to us."
Cosgrove says the Clinic will see how the new venture fares before considering other expansion opportunities. The United Arab Emirates (UAE) is "trying to position itself on the global scene," says Jad Bitar, a partner at Booz and Co. He adds, "To do this, it has associated itself with the best hospitals in the world."
Exporting U.S. medicine
Back in Ohio, Cleveland Clinic caters to international patients with specialty wings that can be cordoned off, personal translators and coordinators, and hotel accommodations that allow for specialty dietary restrictions. In 2012, the Clinic treated 3,200 foreign patients, and about 35% of those patients from the Middle East.
A lull in patients seeking so-called concierge treatment led many facilities to begin exporting their brands globally, yet many of the ventures were unsuccessful.
U.K. wants NHS hospitals to expand overseas
For instance, the Mayo Clinic in 2005 opened a cardiac office at Dubai Healthcare City, a health campus of 120 medical facilities, but the system closed the facility five years later. "To charge the fees that you need to cover your costs when you have U.S.-trained personnel and sophisticated technology, you need some pretty high volumes," says Misty Hathaway, administrator for the Mayo Clinic's International Practice and chair of marketing. Mayo's was "not the right model at the right time," she says.
A risky strategy?
Cleveland Clinic's move does present new challenges. If the Clinic fails to meet the same high-quality standards overseas, its brand could suffer. As such, 70% of its 150 new physicians were hired from North America, including many employed by the Clinic. Their salaries and management fees will be paid by the UAE to minimize financial losses. Another 2,000 staff, from technicians to nurses, will get specialized training.
American doctors practicing in the region also will need to familiarize themselves with Middle Eastern customs, including high respect shown to the elderly and the use of chaperones during examinations with female patients.
Doctor's imprisonment prompts warning from global medical group
Earlier this year, the World Medical Association and the American Medical Association issued a warning to physicians practicing in the UAE after the imprisonment of a South African physician raised concerns about equitable treatment of medical-legal matters. Cyril Karabus—a South African pediatric oncologist—was arrested in 2012 and held in the country before being absolved of manslaughter and fraud charges in connection with the death of a girl he treated for leukemia in 2002.
In an interview with South Africa's SABC News, Karabus advised doctors practicing in the UAE to be "very careful." He said, "All I did was treat a child with leukemia, which is what I was supposed to be there for, and suddenly I'm accused of murdering her," adding, "It's a very difficult country because the expatriates are second-rate citizens" (Respaut, Reuters, 4/11).
Get the full picture of your hospital's growth potential
Crimson Market Advantage makes it easy to quickly analyze your position in the market and focus on the physician relationships that best align with your strategic objectives.
FIND OUT MORE
Next in the Daily Briefing
Daily roundup: April 14, 2014