The growing population in the countries all over the world has led to rising medical trend rates across the region and increasing health burden. Expensive healthcare in the developed countries on one side and poor infrastructure with lack of quality medical services and absence of state-of-the-art hospitals in most of the countries in the developing and less developed countries have created a supply scarcity unable to meet the burgeoning demand among the patients.

Key drivers for medical tourism

  1. Non-communicable and lifestyle related diseases are on the rise contributing to more deaths globally; primary causes are cardiac, cancer, kidney, respiratory, diabetes and these result in the need for complex surgeries and advanced care.
  2. Rapidly ageing population with ~30% of the population in developed regions (with access to medical facilities) and ~15% population in less developed countries (with limited access to quality facilities) estimated to be aged over 60 by 2030.
  3. Prohibitive costs of healthcare in certain regions-despite having the best of facilities, exorbitant healthcare cost in countries like US, UK drive under insured and uninsured patients to seek medical assistance in other countries. Moreover, not all treatments are covered by insurance.
  4. Lack of availability (waiting time) of healthcare facilities in regions such as Middle East, portions of Africa and CIS which have the ability to pay but lack quality care and talent.
  5. Lower insurance penetration in several parts of the less developed world makes patients and families explore least cost, most secure and comfortable avenues for healthcare.
  6. Availability of globally accredited institutions which increases the choices available to patients assuming healthcare outcomes in each of these regions are comparable and affordable.

The global medical tourism market was estimated to be US $17 billion in 2015 and it will reach a market value of US $40 billion by 2020 growing at a CAGR of 17%.

Due to the above mentioned reasons, citizens from different countries around the world started looking around for inexpensive quality treatment. But the recent trend deviates from the cost factor and looks increasingly to a combined services of healthcare and tourism for an overall relaxing experience. This has prompted the global citizens to travel to different countries offering such facilities with some exquisite experience. Such people needing specialized treatment look for exotic destinations that offer them cost-effectiveness, world-class medical facilities, ease of travel and stay and also alternate therapy. Hospitals in India have been wooing them by all means. State-of-the-art facilities, globally acclaimed physicians, quality care by the nursing staff have been appreciated by the visiting medical tourists. Their numbers are swelling by the day. The following slide illustrates this comprehensively.

The cost factor definitely induced these people to look around for inexpensive yet quality medical facilities besides ease of travel. Medical treatment in USA and Europe is a very expensive affair and the long queue to avail the opportunity tests the patience of emergency cases.

The medical tourism landscape in Asia is continually evolving as price no longer remains the only important consideration; focus has now shifted to diversity in offerings, niche offerings and even customised luxury. Alternate therapy and wellness treatment has added to the desire for a holistic experience.

The term “medical tourist” was coined by travel agencies to describe people travelling overseas for the sole purpose of obtaining cheaper, usually specialised, medical care.

India being a country with growing population, country’s per capita healthcare expenditure has increased at a CAGR of 10.3% from $43.1 in 2008 to $57.9 in 2011 and going forward this figure is expected to rise to $88.7 by 2016.

The factors behind the growth is rising incomes, easier access to high-quality healthcare facilities and greater awareness of personal health and hygiene.

The country’s healthcare system is developing rapidly and it continues to expand its coverage, services and spending in both the public as well as private sectors.

The private sector has emerged as a vibrant force in India’s healthcare industry, lending it both national and international repute. Private sector’s share in healthcare delivery is expected to increase from 66% in 2005 to 81% by 2015. Private sector’s share in hospitals and hospital beds is estimated at 74% and 40%, respectively.

There is substantial demand for high-quality and speciality healthcare services in tier-II and tier-III cities. To encourage the private sector to establish hospitals in these cities, government has relaxed the taxes on these hospitals for the first 5 years.

The healthcare sector in India will grow to $158.2 billion in 2017 from $78.6 billion in 2012, a report has said. “The healthcare sector is growing at a 15% CAGR and jumped from $45 billion in 2008 to $78.6 billion in 2012 and expected to touch $158.2 billion by 2017,” Equentis Capital said in its report.

Strong mobile technology infrastructure and launch of 4G is expected to drive mobile health initiatives in the country. Mobile health industry in India is expected to reach $0.6 billion by 2017, the report said.

To standardise the quality of service delivery, control cost and enhance patient engagement, healthcare providers are focussing on the technological aspect of healthcare delivery.

Digital health knowledge resources, electronic medical record, mobile healthcare, hospital information system are some of the technologies gaining acceptance in the sector. Going forward, the healthcare sector’s spending on IT products and services is expected to rise from $53 billion in 2012 to $57 billion in 2013.

Telemedicine is also a fast emerging sector in India. In 2012, the telemedicine market in India was valued at $7.5 million, and is expected to rise at a CAGR of 20% to $18.7 million by 2017. Today, through Telemedicine, several Indian Hospitals are reaching out to the remotest countries in the world benefiting the poor patients, who couldn’t afford to travel afar for their treatment. With increased private participation, the healthcare sector has also witnessed rise in FDI inflows. As per law, 100% FDI is permitted for all health-related services under the automatic route.

Demand growth, cost advantages and policy support were instrumental in attracting FDI inflows into the healthcare sector. During April 2000-March 2013, FDI inflows for drugs and pharmaceuticals stood at $10.3 billion, while inflows into hospitals and diagnostic centres, and medical appliances stood at $1.6 billion and $0.6 billion, respectively.

India’s primary competitive advantage over its peers lies in its large pool of well-trained medical professionals in the country. Also India’s cost advantage compared to peers in Asia and Western countries is significant — cost of surgery in India is one-tenth of that in the US or Western Europe.

India’s competitive advantage also lies in increased success rate of Indian companies in getting Abbreviated New Drug Application (ANDA) approvals. India also offers vast opportunities in R&D as well as medical tourism, the report said.

It’s estimated that about 5, 00,000 IPs visit India annually. They come mostly from various countries of Africa, Middle East and South Asia besides, few from the developed countries.

Chennai attracts a minimum of 150 patients every day – 45% IPs and 55% DPs. MIOT, King George, Apollo, Fortis and Global hospitals get the bulk of these patients. Sri Ramakrishna hospital at Coimbatore has signed agreements with 18 countries to provide treatment in various medical fields.

Bone marrow transplant, knee transplant, hip transplant, cardiac bypass, cosmetic surgery, eye surgery, dental care and alternative medicine are the main treatment that IPs prefers to do in India.

There are about 21 JCI Accredited and about 325 NABH accredited/empaneled hospitals in India. Some of the reputed private hospitals in India that attract most of these medical tourists are Apollo, Manipal, Narayana Hrudalaya, Fortis, Asian Heart, BM Birla Heart, HCG Oncology, Columbia Asia, Medanta, Sir Gangaram, Breach Candy, Moolchand, MIOT to name a few.

The report by KPMG, however, points out that India has a fragmented approach where individual hospitals have been promoting themselves as the hospital destinations. The medical-value-travel stakeholders in India need to consolidate their efforts and strategise on how to leverage the available opportunities. A cohesive and integrated approach is required in a collaborative manner leveraging on the collective services towards a stronger and credible value proposition. The individual efforts by respective hospitals defeat the whole purpose of Medical Tourism depriving the country of precious foreign exchanges. The agent-doctor-hospital nexus has created an unhealthy competition that doesn’t empower the patients to have a fair and equitable decision.

Advantages for medical treatment in India include reduced costs, the availability of latest medical technologies, and a growing compliance on international quality standards, as well as the fact that foreigners are less likely to face a language barrier in India. The Indian government is taking steps to address infrastructure issues that hinder the country’s growth in medical tourism. The government has removed visa restrictions on tourist visas that required a two-month gap between consecutive visits for people from Gulf countries which is likely to boost medical tourism. A visa-on-arrival scheme for tourists from select countries has been instituted which allows foreign nationals to stay in India for 30 days for medical reasons.

India competes for medical tourists with China, Indonesia, Singapore, Malaysia and Thailand. And it attracts more tourists than all these countries nations bar Thailand. The CII-Grant Thornton report lists various reasons for this.

  • India offers cheaper tertiary care as compared to its competitors. Tertiary care includes cancer management, neurology and plastic surgery.
  • A heart bypass surgery costs $10,000 in India. The procedure costs about $1,30,000 in the US, $18,500 in Singapore and $11,000 in Thailand.
  • Similarly, an angioplasty costs $11,000 in India as against $57,000 in the US and $13,000 in Thailand and Singapore. A knee replacement is $8,500 here compared with $40,000 in the US, $13,000 in Singapore and $10,000 in Thailand.
  • Unlike most competitors, India allows foreign patients to stay for longer by issuing a special medical visa.
  • Also, the country has simplified the process of issuing medical visas. The 42A special visa is designed to enable a patient, and her attendants, to stay longer than the approved period if the treatment so requires.

Who come to India for medical care?

  • According to a study by Assocham, India received nearly 8.5 lakh medical tourists in 2011. The number is estimated to be 32 lakh this year.
  • Bangladesh accounts for most of them, not surprising given the country’s lack of quality tertiary healthcare and its proximity to India.
  • A study conducted by KPMG and FICCI in 2012 found that 22% of all medical tourists to India are from Bangladesh, 17% from Maldives, 9% from Afghanistan, 8% from Iraq and 6% from Nigeria.
  • Nearly 30% of the tourists come from Ukraine, Armenia, Russia and Georgia.
  • A large number also come from Saudi Arabia, Kuwait, UAE, Tanzania, Kenya, Mauritius, Gambia, Sri Lanka as well.
  • Mostly, the visitors come for knee-joint and hip replacements, bone marrow transplant, bypass surgery, breast lump removal, cataract surgery, cosmetic surgery.

International patients to India mostly come from the following continents and its countries. Though, the figures ascertained vary with different reports. However, there is no dispute in the fact that medical tourist inflow into India has been growing rapidly year-on-year.

Africa (45%): Nigeria, Malawi, Congo, Ethiopia, Kenya, Tanzania, and Sudan

Middle East (35%): Iraq, Iran, Oman, Kuwait, Afghanistan, Qatar, and Muscat

South Asia – SAARC (15%): Bangladesh, Pakistan, Sri Lanka, Maldives, Nepal, and Bhutan

US & Europe (5%): USA, Germany, Norway, and Sweden

What’s being done to promote it?

  • The Government of India has promised to set up a medical tourism circuit to connect “hubs of modern medicine and Ayurveda”.
  • The government has set up National Accreditation Board for Hospitals and Healthcare Providers, NABH, to certify them. This is expected to dispel any concerns potential patients might have about the quality of healthcare.
  • A large number of private hospitals are advertising their services to foreigners on the internet.
  • The tourism ministry has put up a list of hospitals – mostly private but also public hospitals – as medical tourist destinations on its website. The tourism departments of Maharashtra, Kerala, Gujarat, Karnataka and Andhra Pradesh have drawn up similar lists.
  • Maharashtra has even established a Medical Tourism Council to promote the industry.
  • The CII, along with the Indian Health Care Federation, is engaged in a brand exercise “promising customers ‘First World Quality at Third World Rates'”.
  • Many new-age companies have been promoting information about the healthcare facilities in India and trying to connect the patients with the doctors and the hospitals. Technology also is driving this industry.

India is one of the leading players in healthcare domain in the present world. Large number of well-trained physicians and supporting staff, most modern medical technology and highly affordable cost structure make India one of the favourite healthcare destinations. India is having a good number of JCI accredited hospitals in its major cities.

Towards availing alternate therapy and holistic treatment, medical tourists from several countries including the developed countries flock to India for an exotic experience in the lap of nature.

Besides the now famous conventional Ayurvedic Therapy in the Spas and Wellness Centers, India has got some very reputed Holistic treatment centres like Soukya, Jindal Nature Cure, Ananda etc. This has given India an edge over several other countries in the true sense of Medical Tourism.

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