India needs to establish a brand to grab a bigger pie of
the growing industry by offering unmatched benefits to medical tourist

The concept of 'medical tourism' is nothing new. The age-old
concept of ancient Greeks and Egyptians travelling to hot springs and remote
retreats for centuries in the name of health has been converted to the initiative
of medical tourism industry today. Presently, global healthcare industry stands
at $20 billion. It is estimated that by 2012, it will go beyond $60 billion.

"Touching its peak over the past few decades, medical
tourism is a direct result of globalisation of healthcare. There is a genuine
and boosting opportunity emerging for Asian and Middle East countries which
are catering healthcare requirements of developed countries like the US, Canada,
UK and other European countries, where the cost is 75-90 per cent higher. Despite
economic recession, which causes a lack of cash flow, it is still far more affordable
and viable for the patients from developed world to travel for healthcare. Medical
tourism is observing growth despite recession.

Recent Deloitte survey reports that 1,50,000 US citizens
experienced medical treatment abroad in 2006 —the majority being in Asia
and Latin America. The number grew to an estimated 7,50,000 in 2007 and could
reach as high as six million by 2010. According to a survey, 23 million American
travelers are expected to travel to Latin America, Asia and Middle East and
will spend $60 billion, by 2017.

Soaring health expenses and cost-conscious employers, insurers are pushing them
to look abroad for savings. In the US, 46 million are uninsured, 250 million
are under insurance. They are boarding planes not for the typical face-lift
but for discount in serious surgeries like hip replacements and sophisticated
heart surgeries.

There is a surprising shift of healthcare seekers during recession searching
for more affordable treatment to save —Deloitte survey reports—if
there is 50 per cent saving 40 per cent of Americans are willing to travel.

Sometimes, patients requiring elective surgical procedures need to wait for
six to 12 months in UK and Canada. Due to this extremely long waiting period,
the patients often bear severe pain and face grave consequences. As per Sunday
Time, UK report, last year an estimated 50,000 Britons went overseas for medical
treatment. The number is expected to rise this year from 75,000 to 2,00,000
by the end of the decade, creating a £886 million market.

Recession: Marginal Effect

Yes,
recession has affected health industry marginally. However, medical tourism
offers significant saving combined with tourism. It actually stays unaffected
despite downturn. Travel expense is marginally low as the industry slowed down,
hotel expense has reduced drastically. Patients save around 50 per cent to 75
per cent for a surgery which costs $60,000 in the US while $6,000 in India and
$25,000 in UAE. Immediate treatment, travel and tourism opportunity and significant
savings they enjoy.

There are many factors involved in the selection and growth of medical tourism.
'The key factor is a combination of benefits which give additional advantage
like international standard high quality treatment at affordable price along
with benefits of tourism factor. Another momentous factor is that why some Asian
and Middle East countries see a significant growth in inbound medical tourism
and developed countries in a growth of outbound. It is due to many of the health
insurance companies, corporate health buyers, health insurance schemes have
started considering international provider benefits for patients who leave their
country for healthcare.

In 2008, The American Medical Association (AMA) comes forth with the guiding
principle of medical tourism and recommendations for insurance companies who
send patients overseas. It was a very positive note for the medical tourism
industry as AMA acknowledged patients received quality healthcare outside the
US. Similarly, the UK and European healthcare authorities considered medical
tourism as legal and acceptable solutions.

Drivers of Medical Tourism Industry

There are five prime drivers of the industry—technology development, cost
shift, demographic changes, emergence of needs and change. When patients do
not have health insurance or their health insurance does not pay for all the
care they need, the cost of the care is shifted to those patients with health
insurance. It is known as cost shifting, which encourages consumer to search
better options for cost saving. High-cost is the key driving factor.

Technological improvements, efficient global transport and communication system
like the internet is 'flattening' the world. Travel has become easy and people
search for travel activities with various other benefits. There is also emergence
of new consumer needs like avoiding long waiting queues to get medical treatment
and the possibility to have the latest medical treatment. It requires new solutions
which are not available in consumer's home country. Sheer need, is thus another
driving factor.

Demographic change is one of the vital drivers of the industry. Baby boomers
are driving the growth – one of the biggest market segments for medical tourism.
Almost 75 million baby boomers are heading towards retirement in the US and
the cost of private nursing care is too expensive for many of them there. Almost
five million Americans are living overseas as expatriates now. For example,
there are already an estimated 1.2 million retired Americans and Canadians in
Mexico who are going to need high quality healthcare at affordable prices.

Hospitals are increasingly adopting the 'luxurious hotel
concept' than traditional 'unexciting' general wards. A South African safari
tour after an orthopaedic surgery, trip to Taj Mahal in India after an eye surgery
and Mexican cultural exposure after cosmetic surgery proves 'change' as another
necessary driver.

India Needs Strong Brand Management

Though medical tourism is experiencing enormous growth in India in the present
era, several stumbling blocks need to be tackled to achieve maximum potential.
Many destinations have edge over India in terms of better perception of the
destination. Highest level of healthcare quality services along with reasonable
price provide great advantage to India. However, perception of a destination
also plays an important role. The key would be steady political intention which
promises to provide strong security and safety, along with warm hospitality.

It is important for India to create national medical tourism objectives. One
brand, developing an umbrella under which all other Government, semi-Government
and private health authorities would promote services as one brand would go
long way. The key strategy would be to develop medical tourism services combined
with healthcare and hospitality benefits and promote the costs in this need
based market.

In-depth understanding of international health insurance and legal issues are
important, for a malpractice could cost fortune to a healthcare organisation
and Indian healthcare industry. Considering the growth of the industry, many
Government, semi-Government and private institutes promote medical tourism aggressively
but they need to be aware of the legal, ethical, quality care, language and
cultural barriers, proper accreditation process that are involved in medical
tourism business.

By: Dr Prem Jagyasi