India: Untapped potential in the medical tourism market

By M H Ahssan

The Indian healthcare market is Rs 15 billion and growing at over 30 per cent every year. Indian private hospitals are increasingly finding a mention in the travel itineraries of foreigners, with the trend of medical tourism catching up in the country. If industry estimates are to be believed, the size of the medical tourism industry stands at Rs 1,200 - Rs 1,500 crore (Rs 12-15 billion).

A recent CII-McKinsey study on healthcare says medical tourism alone can contribute Rs 5,000- Rs 10,000 crore (Rs 50-100 billion) additional revenue for upmarket tertiary hospitals by 2012, and will account for 3-5 per cent of the total healthcare delivery market. Compared to countries like the UK or the US, procedures like heart bypass surgery or angioplasty come at a fraction of the cost in India, even though the quality of doctors and medical equipment is comparable to the best in the world.

A heart bypass surgery in India costs USD 3,000-6,000, while in the US it costs between USD 15,000 and USD 40,000. The Indian Health Care Federation (IHCF), an association of the healthcare delivery sector that includes the Escorts Heart Institute, Apollo Hospitals Group, Fortis Healthcare among others and CII, under the leadership of Dr Naresh Trehan, executive director, Escorts Heart Institute and Research Centre (EHIRC), New Delhi have also decided to project India as a major healthcare destination. Even travel agents are aggressively promoting India as a destination for medical tourism. This is a huge, untapped market, not just for therapeutic medical tourism like ayurveda, but also for curative treatment.

The benefit to tourism industry could be of the order of Rs 1,000 crore (Rs 10 billion). Indian NRIs, Asians and tourists from around the world are beginning to realise the potential of modern and traditional Indian medicine. Health and medical tourism is perceived to be one of the fastest growing segments in marketing ‘Destination Incredible India’ today. While this area has so far been relatively unexplored, we now find that not only the ministry of tourism, Government of India, but also the various state tourism boards are all promoting health and medical tourism as a segment with tremendous potential for future growth.

Indian hospitals have also realised the potential of this niche market and have begun to tailor their services for foreign visitors. Visitors, especially from the west and the middle-east, find Indian hospitals as an affordable and a viable option rather than grappling with health insurance and national medical systems in their native lands.

* Areas where Indian healthcare excels
* Clinical outcomes being on par with the world’s best centres.
* Internationally qualified and experienced doctors.
* Technology edge.
* Competitive costs - 1/5th to 1/10th of costs in the west.
* Quality of service.
* No waiting time.
* Patient-centric care.
* Exotic experience, increasing popularity as a tourist destination.
* Eastern healthcare wisdom along with the expertise of western medicine.
* Areas where Indian healthcare has to focus
* Accreditation norms to be adopted by all major hospitals.
* Hospitals must conform to a code of ethics.
* Provision of a uniform price band for major specialities especially for health insurance majors.
* Handling of medico-legal issues.

Working with Indian tourism ministry and tour operators to promote medical tourism overseas. Cross-border travel for healthcare reasons is still a highly disorganised movement, but countries are slowly waking up to its potential. In some places, the governments have taken a lead. In others, travel agents specialising in medical tourism are driving the trend.

In India, private hospitals are trying to attract patients on their own and by showcasing Indian healthcare overseas through CII-IHCF led overseas missions. Developed nations will benefit majorly as costs and waiting time come down for a significant chunk of their population. Developing countries benefit through medical tourism as it brings in revenues and provides the right spur to improve their overall healthcare sector, apart from reducing brain drain in their medical fraternities. Least developed countries, too, benefit as they lack facilities for cutting-edge treatment.

The situation was so dismal that in 2002, the National Health Services(NHS) in UK started a pilot scheme for ‘overseas treatment’ to see if surgery services abroad could be bought to shorten the waiting lists. The project focused mainly on facilities available in the European Union.

Meanwhile, many British patients take the initiative to seek their own treatment abroad without waiting for the NHS to sort out its problems.

A Rs 15-billion-plus market growing at over 30 per cent per year throws up huge opportunities for anyone smart enough to tap it. Thus, India not only offers world class cardiac bypass surgery, hip replacements, organ transplants, but also cosmetic, dental surgery and vision correction etc and alternative healthcare which is a significant niche opportunity.

Healthcare insurers in the developed countries are aware of the fact that the option of medical treatment in countries like India could help them reduce premiums and offer options to people who are currently uninsured. Over the next few years, insurance firms are expected to provide a fillip to the medical tourism business in India.