Medical Tourism

The notion of traveling abroad for the purposes of health and well-being is well established. The spas of Hungary, baths of Turkey, and geysers of Sweden have long been popular destinations for those seeking convalescence. Where surgical care was required, the direction of travel generally saw the wealthy citizens of poorer nations traveling to the richer, more medically advanced countries. However, international travel for the purposes of medical treatment is no longer the preserve of political and economic elites. Contemporaneously the whole spectrum of medical treatment is offered in destinations around the world as part of a global market in health care. This treatment spans the full range of medical services, but most commonly includes dental care, cosmetic surgery, elective surgery, and fertility treatment. Medical value travel or ‘medical tourism’ as a term has come to represent situations where consumers elect to travel across international borders with the intention of receiving some form of medical treatment. Differences between medical and health tourism focus on the type of intervention, setting, and particular inputs involved. Setting the boundary of what is health and counts as medical tourism for the purposes of trade accounts is not straightforward. Within this range of treatments, not all would be included within health trade. Cosmetic surgery for esthetic rather than reconstructive reasons, for example, would be considered outside the health boundary.

At first sight medical and tourism are curious terms to run together. Medical and surgical treatment can involve risk, pain, and discomfort; tourism is associated with relaxation and pleasure albeit associated with travel. Although some treatment destinations are those associated with sun, scenery, and sightseeing, it is not clear the extent to which such local attractions are important in the patient’s decision.

A range of nomenclature is used in the health services literature, including international medical travel, outsourcing, and refugees. Although the term medical tourism is increasingly being employed, there are a number of commentators who are critical of its use. Their criticisms center on the notion somehow devaluing the rather serious procedures that such patients are often undertaking.

Arguably, however the concept of medical tourism does have analytical purchase – capturing the health sector element as well as the wider economic impact of such travel. Although it must be acknowledged that medical tourism may have little to do with general tourism rationale, the term is useful because it points toward the commodification and commercialization of health travel. Hence, the role of the industry, issues of advertising, and supplier-induced demand are brought to the fore.

The Nature And Scope Of Medical Tourism

Although there is a general consensus that the medical tourism industry has burgeoned over the past decade, there remains disagreement as to the current size of the industry. Figures that are regularly reproduced in the literature draw on data collected and projections made by Deloitte, which places the number of US citizens leaving the country in search of treatment at 750 000 in 2007. The main objection to Deloitte’s figures come from McKinsey and Co who suggests that, although the potential for such large numbers exist, a more accurate worldwide figure would be between 60 000 and 85 000 medical tourists per year. In large part, very significant disparity may be due to different definitions of medical tourism.

The numbers of medical tourists proffered by McKinsey still appear rather small, particularly in the context of a US population of 360 million, and even the 50 million uninsured. Given that even the most conservative estimates of inward medical tourism to India place the number of tourists at 200 000, alongside figures between 200 000 and 350 000 for Singapore, and 200 000 for Cuba, it would seem that McKinsey’s numbers are understated.

This lack of clarity extends beyond not only the numbers of medical tourists but also their profile, the process of becoming a medical tourist, and the aftereffects of medical tourism. It is assumed that different drivers exist for higher and lower income patient groups traveling from North America and Western Europe. But relatively little is known about sociodemographic profile, age, gender, existing health conditions, and status in attempting to map the composition of the medical tourism market.

Such numbers and insights are important to quantify economic impact and also to assess potential risk to source health systems. Given this gap in knowledge, the discussion within the article is inevitably limited in terms of the literature base from which it can draw upon.

Why Do People Travel?

As would be expected, globalization has played a significant role in the development of medical tourism. Developments in medical tourism mirror the expansion of markets in health care and embedding of neoliberalism on the world stage. Precipitating the rise of what is seen as a consumerist age marked by lower levels of social solidarity, globalization has advanced the commodification of health care. At the most basic level the advent of the Internet and lowering of travel costs has undoubtedly played a vital role in not only raising awareness of the opportunities for surgery abroad but also making the pursuit economically viable. The freeing of medical services from their traditional territorial boundaries reflects a more transnational and international role for health policy development, with partnerships developing between organizations in established and developing medical markets, transnational companies with an increasing stake in health care in multiple countries, and an emerging role developing for supranational bodies.

In terms of the medical tourism market, the free movement of goods and services under the auspices of the World Trade Organization and its General Agreement on Trade in Services has accelerated the liberalization of the trade in health services, as have developments with regard to the use of regional and bilateral trade agreements. As health care is predominantly a service industry, this has made health services more tradable, global commodities. But that it is easier to travel abroad for care does not fully explain why patients become medical tourists.

Medical TourismThe most common explanatory factor cited is that of cost. Indeed it is clear that for those in the US and Western Europe who feel the need to ‘go private,’ the potential cost savings of traveling abroad are huge, with any review of prices showing a potential saving between 30% and 90% depending on the treatment sought (see Boxes 1–4). In terms of familiarity, expatriates often have medical care on their visits back to their ‘home’ country, which would also show up as medical tourism; for example, the large Indian Diaspora in the UK, and the 2nd Generation Mexicans living in the US (see Boxes 4 and 5). In addition, some treatments may not be available or may be subject to a wait in the home country, including the latest technology and techniques. Moreover, some treatments may not be legal in the country of origin. The desire for privacy and wish to combine traditional tourist attractions, hotels, climate, food, cultural visits with medical procedures are also thought to be key contributing factors to the growth in this market. Each of these factors, on their own or in combination, has shifted the direction of medical travel. In the present day not only are India and Thailand top destinations for complex elective procedures but also the very tourists visiting their hospitals, along with those in Poland, South Africa and beyond, are traveling from countries with established and often championed health care systems. Conversely, these championed health systems continue to treat medical tourists at facilities with long-standing reputations (see Box 5).

Marketing Medical Tourism

Medical TourismAt the most basic level, prospective medical tourists are faced with a level of information that is at once overwhelming and also relatively unhelpful. Internet sites marketing destination and providers are relatively cheap to set up and run, and contributors may post information without being subject to clear quality controls or advertising standards. Medical tourist sites promote benefits and downplay the risks, and the lack of clear regulation regarding what information can be presented on the Internet to prospective medical tourists is then compounded by deeper issues of credibility, trust, and perceptions of risk. As with all medical treatments, an element of risk exists to the patient’s health, which is supposedly outweighed by the potential benefits resulting from the treatment. What can be gleaned from the literature concerning risk and safety-related incidents for medical tourism is limited. Although there is evidence regarding, for example, the occurrence of adverse events in the UK hospitals, there is little similar overseas/ international data for medical tourist destinations.

Evidence of clinical outcomes for medical tourist treatments is limited and reports are difficult to obtain and verify. Little is known about the relative clinical effectiveness and outcomes for particular treatments, institutions, clinicians, and organizations. There is scant evidence on longor shortterm follow-up of patients dispersing to home countries following treatments at the range of destinations. That positive treatment outcome should result is important not least because typically the patient’s local health care takes on the responsibility and funding for postoperative care including treatment for complications and to remedy side effects.

Medical TourismTwo particularly interesting stakeholders in the medical tourism industry are brokers/facilitators and providers. There has been a steady rise in the number of companies and consultancies offering brokerage arrangements for services and providing web-based information for prospective patients about available services and choices, which can be attributed to the transaction costs associated with medical tourism, where individuals have to assemble their own information and negotiate any treatment. Typically brokers and their web sites tailor surgical packages to individual requirements: flights, treatment, hotel, and recuperation. Brokers may specialize in particular target markets or procedures (treatments such as dentistry or cosmetic surgery), or destination countries (e.g., Poland and Hungary). Medical tourist facilities will often target particular cultural groups – Bumrungrad in Thailand, for example, has a wing for the Middle East patients. Within the wide picture of medical tourism there is a diversity of participating providers. Relatively small clinical providers may include solo practices or dual partnerships, offering a full range of treatments. At the other end of the scale are extremely large medical tourism facilities (e.g., Bumrungrad, Raffles in Singapore, and Yonsei Severance Hospital in South Korea) where clinical specialism is the order of the day. Providers are primarily from the private sector, but are also drawn from some public sectors (e.g., Singapore and within Cuba). Hospitals may be part of large corporations (the Apollo Group, e.g., has 50 hospitals within and outside India), and ownership itself may lie primarily in the higher income countries from where patients mostly originate.

Countries seeking to develop medical tourism have the options of growing their own health service or inviting partnerships with large multinational players. Individual hospitals may develop relations with travel agencies or wider brokerage companies. Securing accreditation from international programs may be a part of the development of services. In addition to accreditation, other approaches to raising the profile of countries and their health facilities have been used. For example, partnerships and oversight by overseas hospitals and universities, most often from the American private sector, can fulfill a similar role. Formalized linkages with widely recognized medical providers and educators (such as Harvard Medical International and Johns Hopkins Hospital) are becoming increasingly popular among hospitals in middle-income countries catering for medical travelers. A long-standing approach of the Cleveland Clinic, is to train foreign physicians as house staff and fellows to encourage later patient referrals back to the US once they are practicing medicine in their home countries.

The Role Of State Support

Medical TourismA range of national government agencies and policy initiatives have sought to stimulate and promote medical tourism in their countries. Many countries see significant economic development potential in the emergent field of medical tourism. Thai, Indian, Singaporean, Malaysian, Hungarian, and Polish governments have all sought to promote their comparative advantage as medical tourism destinations at large international trade fairs, via advertising within the overseas press, and official support for activities as part of their economic development and tourism policy (see Boxes 2–4).

Government support does manifest itself slightly differently across the medical tourism map. However, common features are the relaxation of visa regulation, promotion of medical tourism within the central ministries of tourism, support for hospitals to achieve accreditation from bodies such as the Joint Commission International (JCI), and a willingness to provide funding. Useful examples can be found in both Singapore and India. Since 2003, Singapore Medicine has been a multiagency government–industry partnership aiming to promote Singapore as a medical hub and destination for advanced patient care. It is led by the Ministry of Health, and has the support of the Development Board (new investments and health care industry capabilities); International Enterprise Singapore (growth and expansion of Singapore’s health care interests overseas); Singapore Tourism Board (branding and marketing of its health care services) (see Box 4 for details on India).

As the case studies illustrate, some places may be simultaneously acting as countries of origin and destination in the medical tourism marketplace (e.g., the US). High income countries may service overseas elites, whereas at the same time their citizens choose to travel as medical tourists to lower and middle-income countries for treatments (e.g., India and Thailand). Thus, Harley Street in the UK and facilities including the Mayo Clinic and Cleveland Clinic in the US have long-standing reputations in the international provision of health care. Conversely, the emergence of lower cost treatments in Thailand, India, or parts of Europe will attract individuals from higher income countries who pursue treatments on the basis of cost. The remainder of the article discusses the impacts on health systems for exporter and importer countries. A country imports if their patients go overseas to receive care, and exports if they themselves provide care to inward medical tourists.

Implications Of Importing Medical Tourist Services

Medical TourismThere are a range of potential financial impacts for publicly funded health care in countries importing medical treatments. Costs may result from overseas cosmetic surgery or dental work that requires emergency or remedial treatment within home countries. Infection outbreaks resulting from travel will also bear upon the public health system. Similarly, there may be health and social care costs that arise from multiple births, as a result of overseas fertility treatments, particularly if facilities use more ‘risky’ procedures. Domestic private health activity may also experience costs, given that they potentially lose business to overseas providers, for example, cosmetic surgery and fertility treatment. National regulators may incur associated costs of patients traveling overseas caused by monitoring advertising and providing detailed information and advice to support potential or actual medical tourists. But overall, there has been little systemic collection of evidence or attempts to estimate system costs and knowledge is fragmented.

Large numbers of medical tourists traveling overseas will impact on the source country’s own health system, perhaps increasing trends that are encouraged by the current domestic private provision. For example, outflows of high-income patients from low and middle-income countries will reduce revenue and dilute political pressure for investment in particular facilities and technology. Indeed, outflows of medical tourists for treatments that could be provided locally could signal a failure of policy and delivery in sender countries. There are suggestions that the target market for South Africa’s breast cancer treatment is a growing pool of middle-class women drawn from across the African region with financial means, but who experience failed domestic policy. Regarding travel from higher income countries, if eligibility for services such as fertility or dental work is tightened, then those with private resources may choose to travel overseas to maintain access. The ability to circumvent waiting times raises issues of equity. However, travel overseas for treatments that are not provided or are illegal within the source country may normalize such treatments and generate debate about the importance of providing them locally (e.g., latest fertility treatments, gender reassignment, organ transplantation, or even euthanasia services).

In countries where Third Party insurers are exploring medical tourism as a provider option, outflows of patients may benefit employers and employees contributing to health plans, and the public insurance system itself. Opportunities for financial benefit may be consolidated if medical tourism becomes an outsourcing option. For the US, research has estimated that 15 treatments would show savings of US$1.4 billion annually if one in ten US patients chose to undergo treatment abroad. Similarly, a recent study looking at possible bilateral medical tourism trade between the UK and India demonstrated substantial savings could accrue to the UK National Health Service from sending its patients to India, both financially and in alleviating waiting lists. If one takes the waiting lists for a selected number of procedures suitable for medical tourism, and compares the cost of sending those patients (plus an accompanying adult) to India, with the costs of getting treatment in the UK, the savings would be of d120 million. Some subsets of the population, such the Indian Diaspora, may prefer to go back ‘home’ for treatment, and may be happy to cross-subsidize some of the costs.

There are arguments that some medical systems are inefficient and face restrictive barriers to entry. A development such as medical tourism can potentially exert competitive pressure on systems importing health care and help drive down the costs and prices offered in domestic systems. Medical tourism may encourage economies to maximize their comparative advantage across labor costs, utilization of technology, and spare capacity. Indeed the US employers are said to be encouraging workers to travel domestically for medical care – a development prompted by deals struck with overseas providers being used as leverage. The possibility of medical tourism resulting in underused capacity in American hospitals has also been raised.

One of the implications of globalization is the increased flow of clinical and ancillary staff around the globe. Individuals may fully or part-train in their home country and move overseas to continue their training and gain experience with a particular specialism. Of major concern has been the flow from low to high income countries. Medical tourism may provide opportunities for professional migrants to return home – so-called ‘reverse brain drain’ or ‘brain circulation.’ This may be a disbenefit for developed countries which have long relied on such expertise to underpin their health system.

System Implications For Exporting Countries

The main exporting countries (those who provide the services to medical tourists) are located across all continents, including Latin America, Eastern Europe, Africa, and Asia. Countries have specialized in certain procedures. For instance, Thailand and India specialize in orthopedic and cardiac surgery (Boxes 3 and 4), Brazil is famous for cosmetic surgery (as outlined in Box 1), and Hungary (Box 2) and Poland are hotspots for dental surgery. As the US case illustrates, all countries may possibly be source and destination countries for medical tourists. However, here we frame lowand middle-income countries as the destination, and high-income countries as source. The magnitude of the possible effects being discussed is largely unknown – typically the potential or actual occurrence of these effects has been observed, but the scale of effect, and how this scale may differ between countries is an unknown quantity.

Economic Impacts

Delivering care to medical tourists will likely increase the level of direct foreign exchange earnings coming into a country and improve the balance of payments position. There are suggestions that Thailand benefits between US$1.5 and 2 billion from medical services and approximately US$0.5 billion from related tourism – overall total value added is 0.4% of gross domestic product. Income from foreign patients can be used within hospitals and national systems to cross-subsidize care for domestic patients, or could be used to help fund capital investment for use by all patients within the hospital or health system. Similarly, there are suggestions that the Cuban experience is to reinvest income from foreign patients into the national system for broader public good. International patients will have multiplier effects – a RAND study of Cleveland’s metropolitan economy highlighted the economic benefits that the Cleveland Clinic added to the local economy.

Economic implications vary depending if international patients are simply using spare capacity or competing with domestic patients. For instance, the push by Thailand to be a hub for medical tourists in the 1990s was a result of the economic crisis in Asia generating a fall in domestic private patients and hence spare capacity in their private sector. In this case, increasing foreign patients entailed a net benefit to the private health system with substantial income and little real opportunity cost. However, where capacity has to be developed, there are substantial potential costs not only in financial terms but also in the wider context of concerns around equity, access, and human resources.

Although medical tourism generates income for the health sector (physicians hospitals, medications, and medical devices), general increases in tourist income (airfares, food, hotels, and souvenirs) are also important. There is a substantial level of expenditure by medical tourists, and their companions, that is not related to medical care. For example, it is estimated that companions would spend approximately twice as much on hotels and tourism as the patient. As discussed earlier, the promise of these earnings often drives the government involvement in investing directly or indirectly (tax incentives) in private hospitals and actively promoting medical tourism. Sectors other than medical care – especially those associated with hospitality and travel – may benefit to some degree from increased medical tourism, as will the government more centrally through increased taxation revenue. However, global business models and the involvement of Transnational Corporations may result in profits from medical tourism and ancillary activities being remitted overseas.

In many instances, medical tourists are either Diaspora or patients who have previously visited the country and are likely to visit again (an estimated 2.2% of foreign travelers and 10% of nonresident Indians visited India with the objective of health treatment). Thus, they are ‘regular’ visitors who on one trip incorporate an element of medical care. In this situation clearly the additional income generated by the ‘medical’ element of medical tourism is far more limited.

There are financial costs associated with promoting medical tourism – including upgraded infrastructure, both within the health sector (e.g., hospital facilities) and beyond (roads, airports, and telecommunications). There are also likely to be costs concerned with the appropriate staffing of facilities (including taxpayer’s subsidized education and training), and possible accreditation schemes. For instance, 48 countries have been granted accreditation from the US-based JCI, the international arm of the Joint Commission, which accredits US hospitals. India has already sought and obtained JCI accreditation for 17 hospitals, and Thailand for 14. Other international accreditation bodies include the Australian Council for Healthcare Standards, the Canadian Council on Health Services, and QHA Trent Accreditation. However, there are costs associated with ensuring compliance with these various criteria, maintenance of these accreditations, and the processing costs themselves.

Trickle Down Benefits

There are arguments around ‘trickle down’ of best practice and technological diffusion as benefitting countries providing medical tourism. The increased ability to purchase the latest technology, for example, and treating foreign patients may broaden the case-mix for staff, or increase throughput to enable them to become more skilled. Medical tourism may be linked to temporary secondments to overseas facilities, which may lead to enhancement of human capital. Increased quality may result through ensuring compliance with (higher) international standards for care.

However, there is the possibility of resources being diverted from the domestic population and invested into private hospitals; such as driving investment toward urban tertiary care rather than rural primary care centers, which more appropriately reflect domestic population needs. It is argued that a number of young professionals are drawn to specialist facilities catering for medical tourists. The focus of resources on high technology orthopedic, dental, and reproductive care, rather than more basic public health measures to tackle infectious disease may be disadvantageous for the local population.

Human Resource Implications

There are arguments that medical tourism provides exporting countries the opportunity to attract back to their home country health workers who had emigrated, thus reversing the ‘brain drain’ of professional mobility. Hospitals treating medical tourists can offer higher salaries and wider opportunities more comparable with overseas institutions. International patients are more likely to trust doctors who have trained or practiced in their countries of origin, as well as ensuring that human resources are brought back to the country or are less persuaded to leave. The empirical veracity of this effect remains unclear however.

There are concerns that medical tourism will cause an internal brain drain, with health professionals abandoning the public health system to work for the hospitals that attract medical tourists, lured by better salaries and work opportunities. There are longer consultation times for foreigners – so generating additional demand for physicians (mostly specialists). Suggestions are that for India there is a shortage of 600 000 doctors, 1 million nurses, and 200 000 dental surgeons. Thus medical tourism would decrease the quality of the public health system and doctor-to-patient ratio. (Given that medical education in countries such as Thailand is heavily tax subsidized, the medical tourism market also presupposes state activity and investment.) As with other aspects of medical tourism, there is little empirical evidence of whether this is happening, and to what extent; and what there is unclear.

Two-Tier System

Do foreign patients benefit from sophisticated private hospitals with a high staff-to-patient ratio and expensive, state-of-the-art medical equipment, whereas the local population only has access to basic, under-resourced health facilities? Certainly there is the potential for medical tourism to have effects in terms of the distribution of health care resources for the less well-off local population. There have been various accusations that in some countries private sector medical tourists may be accumulating medical resources and taking health care services and personnel away from the local population and by driving up prices in the private sector. State regulation can mitigate impacts; however, there is potentially incoherence between trade and health policy that promotes both medical tourism and universal coverage.

Although private hospitals in India may have a responsibility under the Public Trust Act to provide free health care to the extent of 20% of resources, there are no checks undertaken to ensure that this occurs and others have suggested that Indian hospitals renege on promises to provide free health care. Nonetheless, as with much in this area, there is no strong evidence that medical tourism exacerbates a two-tier system.

Conclusion

Medical tourism for source countries may alleviate waiting lists and reduce health care costs, but there is a quality of care risk. The impact of medical tourism on health care systems is not well understood for destination countries: finance, delivery, organization, and regulation. Evidence is limited and there is a necessity to develop a robust empirical base on a number of these issues. In compiling data we must scrutinize sources and surveys used to provide numbers, including the role of national agencies and private facilities. Extrapolating from a country to a more global perspective is difficult, as is ensuring ‘the count’ is appropriate (do we count patients or treatment episodes; day treatments or in-stay treatment; expatriates and those funded by their multinational employers; only large and accredited providers?).

Beyond health policy and management there are also key legal and ethical issues for medical care abroad – informed consent, liability, and legislating for clinical malpractice. Choosing an overseas treatment center brings a number of challenges – difficulties in assessing comparative quality and performance of alternative providers, differences in legal liability and knowledge concerning the processes of how to pursue complaints and receive redress. There are complexities regarding who or what could be subject to legal proceedings – product advertising, initial Internet consultation, a brokerage service, surgery itself, and various mixes therein – the jurisdiction of hearing any case, and the country’s law that should govern any case.

Research and evaluation has not kept pace with the development of medical tourism. The lack of data is significant because countries face difficulties keeping fully informed about the significance (potential or actual) of medical tourism for their health systems. Mechanisms are needed that help us track the balance of trade around medical tourism on a regular basis. This would allow us to add to the evidence-base by assessing who benefits and loses out at the level of system, program, organization, and treatment.

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