Five Factors to Consider before Foreign Investments in Medical Tourism
In recent times, millions of patients have been traveling from home countries to other destinations to seek health care. In 2017, for example, an estimate of 1,400,000 Americans was noted to have traveled out of the country for health purposes, with approximately 16 million international patients worldwide.
Top procedures medical tourists travel for include cosmetic surgery, dental care, cardiac surgical procedures, cancer care, and orthopedic procedures. Countries at the forefront of medical tourism today include Asian countries including UAE, India, Thailand, and Singapore, and Malaysia, as well as European countries including Turkey and Hungary. The drivers for this cross-border healthcare are the affordability and quality of care in the destination country, and access to exotic trips and a congenial ambiance during the travel period.
The medical tourism market has recorded tremendous growth over the last few years, as countries are starting to expand their healthcare systems and investments are being channeled into technology advancements and healthcare infrastructure developments to attract international patients.
Some of these investments are made by independent foreign companies and government of other countries. Investments channeled into establishing or funding healthcare facilities equipped for international medical tourists, provision of hotel services which will partner with these hospitals, investing in the country’s medical equipment and technology manufacturing industry, and investment in the airline industry for transport of the massive inflow of medical tourists into a nation.
With investments come risks, and the considerable investment needed to facilitate success in the medical tourism industry requires that stakeholders do thorough research in two key areas – the services to provided by the proposed investment project and the viability of the destination site for the investment. Experts recommend considering the following factors in assessing the appropriateness of a medical tourist destination before investing.
International patients will rarely visit a country for medical treatment if there are reports of political unrest or social upheavals in the country or if such visits will pose a threat to their personal security. Investors, therefore, should seek adequate consultations regarding the security risks and trends in the destination.
Investors are also advised to check the destination sites for adherence to the CPTED principles of environmental design and national surveillance strategies. Destinations with CPTED-compliant urban environment and building planners are associated with low-security risks and are suitable for investments in health tourism.
Reception at the Project Destination
Having the government and locals of a potential destination site support the project is a very vital factor in deciding to invest. Some undeveloped destinations may establish special economic zones (SEZs) which may offer investors duty-free import of building materials, medical equipment, and furniture, as well as offer tax incentives.
A medical tourism project should be beneficial to the community members and must ensure environmental sustenance. The project, during construction and full operation, must provide job opportunities for members of the local community, and must provide useful healthcare services for locals as it does for international travelers.
If the project doesn’t provide benefits to the community and has negative impacts on environmental preservation, the public may regard such projects as against their interests and the community members may retaliate by being inhospitable to foreigners and medical travelers which, in turn, will reduce the attractiveness of the destination.
In the face of unsupportive legislation and government regulations, health tourism projects will not thrive. In countries with weak regulations for medical tourism, the market may be flooded with unregulated and rogue competitors which will damage the medical tourism brand and reputation for all stakeholders in that country.
In a country with poor policies and standards regarding healthcare and health tourism, and an inadequate framework for health tourism, health tourism investments have a high risk of failure. The proposed destination country must have strict active legislation on handling legal matters regarding international healthcare, fraud, and safety and pricing violations, for it to be regarded as appropriate for investments.
Investors should also ensure that there are laws regarding health informatics and health records systems in the destination country. In the same vein, legislation over telemedicine, physician mobility, and medical records transfer to patients’ home countries should be well noted.
The Right Equipment
Providing healthcare services for health tourists is beyond delivering beds and surgical equipment, it involves tailoring healthcare infrastructure and hotel inventory to the specific needs of the target patient.
For example, investing in carpeted floors during construction of a project may pose risks and challenges of the target patient are those with neurological or orthopaedic disorders who may be using walkers or crutches, and who may be on wheelchairs.
Hotel facilities should suit the type of patients targeted. A facility which aims to attract obese patients for bariatric surgery must partner with a hotel that provides rooms with sturdy furniture and bed for such patients.
Additionally, patients who undergo breast cancer surgery are not advised to sleep in a bed for a few days after surgery, therefore, a facility intending to specialize in breast cancer surgery must provide accommodation that has recliners in the room for the patient to sleep on during the early recovery period.
Investing and establishing the health tourism project is one step, the other is the communication strategies to seize the target market. These strategies should include useful language translation and leveraging technology through website development and a strong social media presence.
An effective marketing strategy must center on amplifying the brand as a destination and not just a clinic, to appeal to the international community presenting it as a health tourist brand. This requires an active collaboration with local and national tourism boards, the Ministry of Tourism, and chambers of commerce. If these agencies do not provide adequate support and brand amplification, the project may fail.
These factors are essential in building a viable health tourist brand and securing a good return on investment for every investor. The health tourism industry is a growing and delicate market and factors leading to success in the business are multifaceted. A careful examination of the key areas, including the viability of the project in the destination site, operational logistics, and effective marketing and communication will guide investors on the right path to success.