Hispanic Health Care
20 Jun 2005|spalacios
Last week I began this blog series about the vast opportunity the Hispanic population represents to US business. Today I’ll continue to develop the context of why any sane business, and most notably the health care industry, should invest in this market.
Although Hispanics on the whole still have only a small share of America’s wealth, their participation in the economy is growing. Let’s look at some market projections.
In January 2003, the University of Georgia’s Selig Center , the authoritative source for the US Hispanic market, estimated their spending power to be $600 billion. They project that Hispanic spending power will reach $1 trillion in 2007. These figures are an upgrade to statistical projections made only 8 months ago — evidence that this market is evolving faster than even the experts expect.
Homeownership among Hispanics continues to grow. Nearly half now own their own homes, and according to Harvard University’s Joint Center for Housing Studies , one in five new homeowners will be Hispanic by 2010.
Hispanics are also starting businesses and entering the professional class at a quick clip. Hispanic-owned small businesses in the US were estimated to reach 2 million, and generate revenues totaling $274 billion, in 2004. Merrill Lynch targets 3.7 million affluent Hispanics with an estimated buying power of $292 billion.
Perhaps most importantly, this “minority” segment is fast becoming the plurality. They are reaching critical mass. And unlike other waves of immigrants, they are expected to retain a much stronger connection to their culture of origin.
This means that you can’t wait for them to acculturate: to reach them, you have to tailor your programs and communications to their preferences and needs. Yes, this will take investment. But, if you don’t act in the near term, the cost of entry will be much higher down the road, when your faster acting competitors are entrenched.
If you’re still not convinced, here are other indicators of change:
As Hispanics become the plurality, they are becoming a political force that cannot be ignored. In response, government programs and health regulations are changing in their favor — especially for undocumented Hispanics. One example is Matricula Consular, a U.S.-sanctioned program for undocumented Mexicans. In 2001, the Mexican Consulate launched the program in order to issue identification to undocumented Hispanics in the United States, primarily so they could open bank accounts here and send money back to Mexico. In the first 24 months, it has been estimated that nearly two million people signed up.
In the same vein, President Bush recently endorsed a Hispanic guest-worker program. It has a long way to go, but the fact that a conservative president has gone this far can only suggest that there is an appetite for changing the rules of the game on a federal level, as Ana Radelat’s recent column in Hispanic Trends documents.
States are following suit. Virginia — arguably a conservative state — is currently debating whether or not to extend higher education benefits to undocumented Hispanics. That’s higher education: the argument has already been resolved for high schools and grade schools, where undocumented Hispanic children are educated at state expense. Even where official policy denies services to undocumented people, the de facto policy is that government is willing to serve them, particularly in health care.
These developments point to the potential, and the need, for wide-scale market creation. HMOs, Insurance companies, Hospitals/Clinics and Pharmacutical companies are just now starting the process of creating ROI assessments and regional or national strategies. The Health Care Industry is waking up to the US Hispanic market. Innovation (new business models, new offerings and new communications) and profit will soon follow for those actors who choose to take action with the right strategy.prev next