Medical tourism: A hit and myth affair

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Capturing a slice of the health tourism market may be tougher than the UAE thinks.

For all its press, medical tourism is still an unmapped market. Two hotly anticipated reports, released by data giants McKinsey and Deloitte earlier this year, gave starkly different pictures of the industry.

McKinsey pinpointed between 60,000 to 85,000 health tourists globally per year.

Deloitte's report, released three days later, claimed 750,000 from the US alone in 2007; a number, says Josef Woodman, author of Patients Without Borders, as spectacularly overhyped as McKinsey's is underplayed.

Still, talk of a boom has whetted the appetites of governments, with the United Arab Emirates (UAE) the latest country to hitch its wagon to the trend.

Dubai has led the charge, with the city-state's tourism authority predicting the UAE will receive 11.2 million medical tourists by 2010, largely through Dubai Health Care City (DHCC).

But for a country where most medical tourism is outbound - government figures show US$2 billion is spent annually sending nationals abroad for care - it could be an uphill struggle to turn the flow around.

Trick or trend

One of the greatest myths about medical tourism is its popularity. Though the hype suggests otherwise, globetrotting patients still occupy a niche.

Woodman's research shows two to three million health tourists travel globally each year: a trickle when compared to overall healthcare figures.

Another illusion is that a portion of those patients are targeting the UAE. Despite fevered promotion of DHCC, numbers on the ground are low. The country's biggest brand names, including Moorfields Eye Hospital Dubai, are reporting tens rather than hundreds of health tourists.

And all from the Middle East region, rather than the juicier health markets of America and Europe.

A far larger proportion is made up of Emirati patients heading abroad for treatment. Despite ploughing money into the national health service, the UAE is still struggling to hold on to its own patients, notes Dr Jason Yap, director of healthcare services for the Singapore Tourism Board.

At any one time, between 150 and 200 Emiratis are receiving medical care abroad.

"If you slice our medical tourism figures by the Middle East, the numbers aren't dropping," Dr Yap says. "In fact, Singapore General Hospital is reporting more than 50 Emiratis a month - more than a year ago."

Last year, the UAE Embassy in Singapore opened a medical office to better marshal the Emiratis flying in for treatment.

Another myth is that the UAE is well equipped to compete globally. Although the country boasts 15 internationally accredited hospitals, treatment prices are double those on offer in Southeast Asia - a region with as many quality facilities, and an established reputation as a health hot-spot.

Figures show a cardiac bypass costing around $130,000 in the US, can be had for $44,000 in the UAE. In Singapore and Thailand, the same surgery costs around $18,500 and $11,000 respectively.

Guy Ellena, director of health and education at the International Finance Corporation (IFC), a World Bank agency, believes the UAE is too expensive to lure tourism.

"There is not enough of a comparative advantage to attract people from other parts of the world," he told MT. "Nearly every government believes that medical tourism will make a change to their country, but it will follow the rules of the market - cost."

Niche work if you can get it

Any channel into the health tourism market will require a radical rethink of the country's existing marketing strategy.

The UAE has angled itself as one-stop-shop for healthcare - a spokesperson for DHCC optimistically called it "the leading destination for comprehensive health services" - a title it's unlikely to fulfill.

"To be the destination for everything will be very difficult," warns Dr Yap. "We [Singapore] don't aspire to that - we don't have the capacity."

Singapore has wised up to the idea that while cost is the main driver in the mass market, it's less important for companies selling a select product. The country has built expertise in specific areas such as robotic surgeries, to help it stand out from the travel crowd.

More countries look set to follow suit. Health economists have predicted hospitals will turn away from offering end-to-end care, shifting instead to facilities with specialist expertise.

"We'll see a lot less of the type of hospitals that do everything," says IFC's Ellena. "Each hospital should undertake the same management exercise and ask; ‘What are we good at?'"

Dr Prem Jagyasi, the Dubai-based chief strategic officer for the Medical Tourism Association, believes the UAE could excel if it follows a niche market plan.

"The target is to become a healthcare destination for specific services," he says. "Where we have a specialisation, we are in a good position to market it, even if it is at a higher cost."

It's a trend taking off among local health facilities. Dr Adam Bader, CEO of the American Academy of Cosmetic Surgery Hospital (AACSH), Dubai, has banked on niche expertise justifying high prices.

The hospital, billed as the first exclusively cosmetic hospital in the world, anticipates 20% of its revenue will come through medical travel.

"We're looking at a select market, the A/B society," Dr Bader says. "We've built our hospital on that clientele."

Since its opening in June, AACSH has seen 460 patients: 60% from the UAE, 30% from the GCC with the remaining 10% from North Africa and Europe.

"The government needs to adopt specific marketing, to look at the niche markets that aren't available elsewhere," Dr Bader says.

Dubai's existing tourism market swings in the UAE's favour. Experience in Southeast Asia shows how entwined general tourism and health travel is. The Indian Tourism Board coined the term ‘medical tourism', while the key player behind Singapore Medicine is the country's tourism agency.

Global talk about Dubai means the country already has an edge in the promotional stakes, suggests Josef Woodman. The UAE government only needs to convert a percentage of its existing visitors to build a significant health tourism base.

"Dubai is the perfect place to start as everyone...knows of and wants to visit Dubai," he says.

Local industry

The niche approach is not just confined to choosing specialties. The UAE must tone down its plans for targeting a global market, says Woodman, as healthcare is still, at heart, a local industry. "It's not a natural reflex to go elsewhere," he explains.

Globally, this truism has been borne out by patient figures. Despite a European Union law allowing patients in member states to recoup the cost of having care abroad, few have taken up their right. The EU spends €1,000 billion ($1,600 billion) annually on healthcare, but just 1% is notched up across border.

Closer to home in Jordan - ranked as the Middle East's top healthcare destination - more than half of medical tourists come from neighbouring Iraq and Palestine, with Sudan, just over the water, providing the country's third largest source of patients.

"Patients favour destinations that are culturally friendly," says Woodman. "There aren't the language and culture barriers."

A number of Arab states are ripe for cultivation. Oil wealth has catapulted many to the ranks of second world nations, but their healthcare systems have lagged behind.

AACSH has quickly realised the potential of local pickings, says Dr Bader.

"I'd say 80% of our market is the region," he says. "Countries like Iran are huge tourism targets for us because they don't have these [cosmetic] services available."

Public appeal

For all its posturing, the UAE's Ministry of Health has shied away from promoting itself as a medical tourism destination. While the government has recognised health travel as a potential revenue stream, says Dr Jagyasi, it has buckled under pressure to get its own health system in order first.

"It's preoccupied with its own health reforms," he says. "They [the government] are very interested, but the current overhaul of healthcare policy means any tourism efforts are likely to come from the private sector or specific sections of the market."

Ironically, the UAE's national health service could be the biggest beneficiary of medical tourism. Currently, all the emirates suffer from city-state syndrome. Their small populations mean there isn't a large enough patient base to attract top medical talent, or the critical mass to support certain specialties.

Singapore has faced the same problems, admits Dr Yap. "For us, medical tourism was less about identifying a revenue stream and more about addressing the issue of a small population.

"Our problem is that if we only serve our local population, we can't serve them well."

Singapore treats one international patient for every ten local patients, helping keep costs low for the whole population.

The hospitals catering to medical tourists will create jobs, tempt home doctors and nurses, and attract enough patients to keep specialties afloat, agrees Woodman.

"Unless you have a tremendous amount of government funding, it's in a country's best interests to identify what it can offer the medical traveller,' he says. "Tourism is a means to a full, robust health system for the entire population."

Global prognosis

Healthcare is taking a bigger role on the world economic stage, but it has stopped short of the globalisation favoured by other industries.

This shortfall has reopened the debate over whether medical tourism is more of a trick than a trend; a blip before hospitals take the same route as Starbucks and McDonalds and open an outlet in every city.

Woodman already believes health chains are thinking on a global scale. "There's no question, just as you see European and American hotels in every country, hospital networks will go the same way."

Three of American's largest hospital networks are already opening facilities in Mexico and Latin America - just across the frontera for US tourists - while the UAE is already home to Johns Hopkins, Cleveland Clinic and Thailand's Bumrungrad chain.

These hospitals stand to be the biggest winners in the tourism trade, as they're planning globally, predicts Dr Yap.

"If you look at the way health workers are moving round the world, they got it some time back," he says. "The whole medical travel trade is just a corner. It's the start of the globalisation of the industry."

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