The growing anti-aging industry can be attributed to the large number of baby boomers who have disposable income and are expected to use it for youth-generating products and services. Specifically, The International Council on Active Aging finds that younger boomers (born 1956-1964) have an estimated $1.1 trillion in spending power and older boomers (born 1946-1955) follow closely with an estimated $1 trillion in spending power.

As boomers look for those anti-aging remedies, many are turning toward the spa industry. According to the International Spa Association (ISPA), as of July 2007 there are more than 32 million active spa-goers. The ISPA finds that many boomers are leading the pack in frequenting the fastest-growing segment within the spa industry– medical spas, which are defined as facilities with programs that integrate traditional and nontraditional medicine and spa treatments.

Medical spa facilities and services offer outpatient remedies to anti-aging needs while providing relaxation and beauty services. They also allow consumers to avoid more invasive surgical anti-aging related procedures.

The International Medical Spa Association indicates that 12,000 Americans turn 50 everyday–one every eight seconds–and this will continue for the next 20 years. If this is the case, the med spa industry is destined to continue growing in terms of facilities throughout the United States and new services that provide boomers with ongoing solutions to anti-aging.

The case for staying up-to-date on medical spa services is further illustrated by an American Society for Aesthetic Plastic Surgery survey that found that of about 11.5 million procedures performed in 2006 only 17 percent were surgical and 83 percent were nonsurgical. These nonsurgical procedures cost Americans approximately $4.5 billion.

Currently, procedures like Botox, dermal filler injections, laser hair removal, microdermabrasion, chemical peels and laser skin treatments are typical medical spa lingo. This list will evolve to include new cosmetic products and med spa services including ones that incorporate new forms of alternative therapies like ayurvedic medicine. (See text box.)

New technologies such as body sculpting and energy-based procedures, facial fillers and new molecules for topicals are entering the market. The latter refers to the emergence of new products applied to the surface of a body part. Microdermabrasions and peels are surface cell exfoliation procedures offered at med spas. But now, microdermabrasion and peel-like treatments (in the form of topical creams) can be purchased at local drugstores.

Advanced methods of skincare and relaxation services are also being added to traditional spa menus to appeal to the growing potential client base.

The bottom line for underwriters and brokers in the allied health care space is that it's vital to follow this industry to understand new procedures, new spa business models and each class of services that generate new risks. This proliferation comes with perils, and underwriters are scrutinizing proposed insureds now more than ever.

Underwriters and brokers should be particularly cognizant of the increase in nonphysician professionals who are providing medical spa treatments.

It is critical that the credentials of all allied health care staff/practitioners are checked and approved to meet the particular state's requirements where applicable.

Many complications occur as a result of treatments rendered by unqualified or untrained practitioners.

The toughest challenge that underwriters face is determining an acceptable level of training and experience for medical spa services, especially as so many new treatments are introduced.

Medical spas should also be implementing proper protocols, such as employee and client codes of conduct, client selection protocols, statements of privacy/confidentiality, and informed consent documentation.

Additional risks are arising from allied medical practitioners partnering to form health and wellness centers, providing mental, physical, vocational, spiritual and social health services under one roof. In some cases, groups are insured together in a shared limit policy. In others, each individual practitioner is required to maintain their own professional liability insurance to join the group.

With more services under one roof, understanding the nuances of each service is again critical. Underwriters and brokers should be careful to avoid gaps in coverage as well as watch for deep pocket exposures.

The overview of med spas is a strong example of significant growth within the subcategories of allied health care. Underwriters will continue to see opportunities in market segments such as skilled nursing, adult day care, home health services, adult fitness centers and geriatric care consultants–a whole host of new professional environments and services tailored to the increasing boomer clientele who are looking to prolong their youth with an interdisciplinary approach to general health and wellness.

In addition, there will be more growth in traditional forms of allied health care that boomers require, such as dieticians, speech pathologists, physiotherapists, social workers, psychologists and in-home services through new home health agencies.

These new services might not keep the doctor away but rather supplement the regular health regimen–apple and all.

The allied health care industry keeps expanding and will continue to be an evolving space that underwriters and brokers will want to educate themselves and their clients about.

Michelle Kim is assistant vice president, Allied Healthcare Professional Liability Underwriting for Hiscox USA, based in midtown Manhattan. She can be reached at [email protected].