BBJ: FirstMed came to Hungary in 1999. What were the main challenges in setting up business here at that time?
Denis Diokno: We started our project in Hungary in 1998, and we decided to invest here because it was a time of change, a time when the rules were being rewritten. In Western and Southern Europe, the rules were set, and the bureaucracy had remained the same for 50, 100 years. The initial difficulty was that in Hungary, the rules were literally written at the same time that we were opening. Nobody had created a clinic like ours in Budapest at that time. But apart from that, I would say that for the most part, things went smoothly in Hungary. Language was a bit of an issue, because it was generally easier to communicate in German than in English. But most of the people I dealt with spoke English pretty well. As the years went by, more and more young people spoke English. We didn't have any major problems with the bureaucracy. It was easier to get things done here, even compared to my previous experiences in China and Moscow.
BBJ: How was the competition?
DD: Since 2010, private clinics started to increase, but they were not real competitors for us, since we mainly cater to expats. Of course, over the years the customer base has changed, but our patients are still mainly foreigners, about 75-80%, 20-25% Hungarians. And there are different levels in the private sector. The price ranges vary greatly from clinic to clinic, so we can say that the market is fragmented with different levels of competition. We consider our business stable. Foreigners have certain expectations, and we certainly meet them. We have to maintain a high level of English. Not only in conversation, but also in the documents we issue. One of our key advantages is that we can deal with more than 150 different international insurance companies in multiple languages, and we have to be able to communicate in those languages. There are different insurance codes involved in dealing with that, and that is one of our advantages.
BBJ: What are your challenges today?
DD: I think there are challenges sometimes. For example, when the government increased the salaries of all health workers. This had a big impact. But it was a step taken for good reasons. Healthcare employees needed better compensation. So, from a human perspective, I think it was great for doctors, nurses and the public sector. On the other hand, it was a challenge for the private sector. Of course, we didn't necessarily have to make a corresponding increase in the private sector, but it still had an impact on the budget. Also, today, it is more difficult to recruit doctors, at least from the public sector, because some doctors don't want to give up their public service jobs and public service hours. This also applies to nurses.
BBJ: What are the opportunities for growth?
DD: Naturally, each market has a certain number of expats and tourists. Initially, we wanted to expand further in Hungary, but this required us to change our business model and create a different marketing plan. That's why we decided to focus on international expansion.
We already have a clinic in Rome, Italy. In fact, the Italian people are very impressed with our operations. We opened an endoscopy center here. As in Rome, one of the key areas where we have grown is women's health. It's a very popular service for us and a growing business.
Besides Rome, we plan to open our next clinic in Milan by February 2025. We plan to open two smaller clinics in Florence and Venice, and are also looking at Lisbon and Paris. We will also be looking at several cities in Germany, mainly tourist clinics, and maybe Berlin too. In the near future, we expect to have 20-25 FirstMed clinics across Europe, and then maybe Asia and South America.
BBJ: Society is set to be greatly influenced by artificial intelligence. Is it already being used in private healthcare?
DD: By the end of the year, we plan to incorporate an element of artificial intelligence into our operations. With a medical transcription system, you can essentially press a button on your computer or smartphone to look the patient in the eye and have a conversation about their symptoms. The system takes notes and creates a medical record for the doctor. It also has the ability to make a diagnosis based on all the information collected. Once you've finished talking to the patient, you can review the medical record and the recommended diagnosis. The doctor can decide if it's appropriate or if there are other things to consider. This means the doctor can focus more on the patient and the computer screen. AI improves the doctor-patient experience. It should also be much more efficient.
This article first appeared in the Budapest Business Journal print edition on July 12, 2024.
