medical tourism case study tom200 impacts of tourism diane drummond

Medical TourismCase Study

TOM200 Impacts of tourismDiane Drummond

Broad Definition of Medical Tourism

• Medical Tourism is ““travel with the aim of improving one’s health.” Bookman and Bookman (2007)

Or

“The act of travel with the purpose of health and wellness as an outcome” Brannon (2010)

Definition of Medical Tourism

• Drummond, McKeown, (2011) defined medical tourism as:

• “the act of offshore travel that has been undertaken intentionally for the purpose of having a medical or surgical intervention or procedure within an accredited medical environment such as a hospital”.

Brief History

• Early records of travel 3000BC documented travel to the temple of healing gods or goddesses in Syria

• 16-17th Centuries, St Moritz and Bath became popular destinations for the rich to soothe their ills

• Medical tourism in its present form has been in vogue for 30 or more years, predominantly for dental or cosmestic surgeries.

Photo credit: Recovery by the pool in Thailand

Types of Medical Tourism

The Continuum of Medical Tourism Activities

Covers all spectrums from birth to death

Medical Tourism Host Countries

Medical tourism markets ex USA

• Mexico 1.5 million• Thailand 1.2 million (2006)• India 450,000 (2007)• Singapore 410,000 (2006)• Malaysia 300,000 (2006)• Korea 60,200 (2009)• Costa Rica 20,000• New Zealand 2000 patients (2010)

The problem is definition

Adjusted Medical tourism markets ex USA

• Mexico 530,000• Thailand 420,000• India 450,000• Singapore 144,000• Malaysia 100,000• Korea 20,000• Costa Rica 7000• New Zealand 150 patients

What are they getting done?

• Dental 31.25%• Surgery 28.98%• Cosmetic 13.07%• Orthopaedics 6.82%• Eye/Vision 6.82%• Examination 4.55%• Alternative Medicine 2.84%

Model for Understanding the Drivers of Medical Tourism

Globalisation

Consumerism

Technology

Medical Tourism

Aging Population

Model for Understanding the Drivers of Medical Tourism

Globalisation - Internet, faster planes and greater exposure to other cultures

Consumerism – Individuals have greater control over decisions that affect their health care, and are more engaged in their health decisions

Technology – the internet has played a major role in the growth as it is a source of significant information on treatment options

Who is the medical tourist?

Who is the medical tourist?

“Of all the people who have ever lived past the age of 65 from the beginning of recorded human history, two thirds are alive today”. Adriane Berg – Generation Bold

Model for Understanding the Drivers of Medical Tourism

The growth in medical tourism is being driven by demand.

Consumers are looking for:

•Quality of Life solutions•A solution to their health issue•Cost savings against the US equivalent

Cost Drivers of Medical Tourism

A massive 80% of the health costs within the United States are the

result of Defensive Medicine.

Medical Tourism ex USA

The size of the medical tourism market

• Americans are still not great travellers• Only 10-15% of Americans have passports• 360 million Americans, only 36-54 million have passports• In 2007 750,000 American medical tourists sought medical

intervention offshore• Major USA generating markets

– Los Angeles– New York– Dallas– San Francisco– Washington DC

What about the impact on host communities?

It is observed that what is currently known about the effects of medical tourism on host communities is minimal, unreliable, geographically restricted and mostly based on speculation, often due to the third world nature of host country

What about the impact on host communities?

Economic Impacts•Increased employment• both within medical sector• and tourism sector•Income benefits•Training•Multiplier effect

Economic Flow of Medical Tourism

Economic Flow of Medical Tourism

Economic Flow of Medical Tourism

Economic Flow of Medical Tourism

What about the impact on host communities?

Cultural•Preservation of cultural heritage• traditional medicines making a resurgence•Appreciation of local culture• opportunity to have interaction with host

community•Cultural Exchange• Language barriers, cultural fit still a

challenge.

What about the impact on host communities?

Social Impacts•Increased quality of life for communities•Medical staff often bonded•Employment•Increased education•Spirit of place•Successful medical tourism countries have strong government support

What about the impact on host communities?

Physical Impacts•Often urban environments•With recuperation in semi rural settings•Risk of infection•Investment in purpose built facilities

Photo credit: This photo shows the beachside view from a high-end resort in Mahabalipuram, India that is affiliated with a hospital treating international patients in a nearby city. Patients can choose to go to this resort during their recovery stay.

So what about New Zealand?

http://tvnz.co.nz/sunday-news/sunday-august-30-over-here-under-repair-2948347/video?vid=2956238

So what about New Zealand?

Currently 2000 patients per annum

Many of these are from Pacific Island communitiesas part of New Zealand’s responsibility

Economic Flow of Medical Tourism

• Currently numbers are low, estimated to be at 150 per annum as intentional medical tourists ex USA.

• On average, $1 spent on the medical activity would add an additional $2.99 to the New Zealand economy, from the indirect activities and wider spill over input to the economy. (multiplier effect)

Economic Flow of Medical Tourism

14.6% of medical tourism spend is directly related to tourism:• Return flights• Accommodation• Internal travel• Pre and Post Op Activities • Post operative activities taken by 50% of medical tourists

Medical Tourism Value Chain in NZ

Opportunities for Tourism Operators in NZ

• Pre and Post Operative services• Special needs services• Access tourism• Hard of hearing• Sight Impaired• Hotels to have increased disability accessibility• Partner programmes

Economic Flow of Medical Tourism

For every $ spent, medical tourism inputs $2.99 back into the economy due to the multiplier effect

Economic Flow of Medical Tourism

Each medical tourism patient represents a return of $141,000 into the New Zealand economy

Economic Flow of Medical Tourism

Just ten medical tourists represent $1.41 MILLION dollars inputinto our economy

Economic Flow of Medical Tourism

This potential represents new tourism market of $2.8 billion dollars ($420m tourism)

Demand Model

Demand = Facilitators x Motivators Resistance Factors

Motivators

• Financially competitive• Americans are living longer• NZ has an excellent reputation built on

the100% Pure imagery of being clean, but most importantly safe

• NZ has first world status and first world health care

Facilitators

• Medical Visa Systems are in place

• The distance to market is not seen as a barrier

• Americans are risk adverse and NZ is seen as one of the safest destinations on earth

• NZ has the capacity with the private healthcare sector to accommodate 35000 bednights pa

Resistance Factors

• Medical tourism is largely owned by the insurance industry who dictate which providers will be used (much like the cruise industry – closed shop)

• Access to sufficient numbers has been adhoc, on a case by case basis

• The conversion rate of 5% of enquiry is very low

What next?

• For Medical tourism to be successful in the New Zealand context, it needs investment in a sustained marketing programme, with support from the New Zealand government and key stakeholders (cluster development).