New standards for cosmetic surgery in Europe

The Health Tourism Blog has moved to the IMTJ web site. You can now find the Health Tourism Blog here in future.I will continue to post the first few paragraphs of the blog posts here. You can find the full version of this blog post on IMTJ:

Here's an extract of the latest blog post: New standards for cosmetic surgery in Europe


The recent PIP implants controversy has raised more concerns about regulation, operation and standards within the cosmetic surgery industry. In the UK, the Guardian newspaper has recently highlighted private cosmetic clinics that employ surgeons to carry out breast enlargements, nose jobs and tummy tucks who do not hold qualifications as plastic surgeons within the NHS (Private cosmetic clinics employing 'unqualified' surgeons).  There are also concerns about the quality standards and practices of cosmetic surgery clinics both within the UK and across Europe. A new European Standard on Aesthetic Surgery Services represents a significant move to address these shortcomings.

Regulating the cosmetic surgeons

In general, cosmetic and plastic surgeons who carry out cosmetic surgery at one of the private hospitals owned by UK groups such as Nuffield, BMI and Spire hospitals will hold an NHS consultant position, usually in Plastic Surgery or ENT Surgery - NHS consultants who do some private cosmetic surgery work. In contrast, many of the surgeons working for the cosmetic surgery chains such as Transform, Harley Medical Group and the Hospital Group are not NHS consultants.
The British Association of Aesthetic and Plastic Surgeons (BAAPS) has raised concerns about the influx of cosmetic surgeons into the UK from Europe. The BAAPS President told the Guardian, "We very often get applicants from Europe. Although they automatically get on the specialist register, the quality of training they have had is in no way equivalent to a trainee in the UK and they are often not deemed suitable for an NHS post".

According to Transform, "Qualifications obtained in other parts of Europe are at least the equal to those obtained in the UK" and said it was "completely untrue and highly misinformed" to suggest otherwise.
In June 2011, the European Commission published a Green Paper, “Modernising the Professional Qualifications Directive”. This Directive, adopted in 2005, sets the rules for mutual recognition of professional qualifications between Member States.  Consultation on this paper has now closed.

Read more about this in the full version of this blog post on IMTJ: New standards for cosmetic surgery in Europe

Cosmetic surgery tourism and the PIP implant controversy

To keep things simple, this blog has moved to the IMTJ web site. You can find the Health Tourism Blog here in future. Here's an extract of the latest blog post entitled:  Cosmetic surgery tourism and the PIP implant controversy

The PIP breast implant controversy continues to grab the headlines across Europe. Concerns have been raised by women who have had their breast implants as “cosmetic surgery tourists”. What do they do if they have received a PIP (or a Rofil M) implant in a cosmetic surgery clinic in another country? Research by Treatment Abroad shows that UK patients may be less at risk than if they had gone for breast augmentation in the UK.

It is estimated that 40,000 women in the UK have received implants manufactured by the French company Poly Implant Prostheses (PIP). PIP implants contain low grade silicone; there are concerns about the risk of rupture of PIP implants and the effect that this silicone will have on the patient.

Reaction has varied across Europe. The French government has offered to pay for implants to be removed. The Czech, Dutch and German health authorities say that the implants should be removed. The UK government has said that there is no evidence that routine removal of PIP implants is necessary. However the NHS has agreed to remove PIP implants for free if the original operation was undertaken by the NHS (usually as part of a breast reconstruction after surgery for breast cancer). It has also said that women who are concerned about their breast implants should be able to have them removed for free by their private cosmetic surgery clinic.

The reaction from the private cosmetic surgery clinics in the UK has been mixed. Many providers such as BMI Healthcare have agreed that women who wish to have their PIP implants removed and replaced will be able to do so, at no cost.

However, the company that has done the largest number of PIP implants in the UK has said that it will not replace them free of charge. The Harley Medical Group has 13,900 clients who received PIP implants between 2001 and 2010 at their 31 clinics in the UK and Ireland. At the weekend, patients marched on the offices of cosmetic surgery clinics in Harley Street demanding that private clinics replace PIP breast implants.

.....Continue reading this health tourism blog post on the IMTJ web site.

Medical tourism: Trends for 2012 and beyond

To keep things simple, this blog has moved to the IMTJ web site. You can find the Health Tourism Blog here in future. Here's an extract of the latest blog post entitled: "Medical tourism: Trends for 2012 and beyond"

Medical tourism: Trends for 2012 and beyond
Christmas is over, the New Year is upon us, so it’s time to dust off the crystal ball and put forward our take on what’s in store for medical tourism in 2012 and beyond. We’ve looked at the future of medical tourism from three perspectives – the market, the patient and the industry 

The market

The global economic downturn and medical tourism
Forecasts for the global economy are not encouraging....recession in Europe, anaemic growth in the US and slow growth in the emerging market economies is anticipated for 2012 (Morgan Stanley: 2012 Outlook). If you are in the medical tourism sector, you need to understand some of the fundamental trends that affect businesses and markets in a recession.

• In the mature, developed economies (e.g. USA, Europe) continued unemployment and pressure on disposable income will influence demand in 2012. Consumers will minimise or reduce spending on healthcare where they can. This does not mean that hard pressed consumers will be flocking abroad for their operations to save money. Many will delay treatment, or in the case of “optional surgery” such as cosmetic surgery, they may not be able to afford it at all. Domestic prices for surgery will be driven down as hospitals apply marginal costing and prices to fill empty beds. In areas of treatment, where the need for treatment is “income-inelastic”, demand for medical tourism services will remain strong.  Patients will continue to dig deep for services such as infertility treatment, stem cell treatment, and for surgery which is essential, life-saving or life changing.
• In emerging markets (such as Russia, China), the growth in incomes (and freedom to spend) is outstripping the development of domestic healthcare services and this may drive demand for medical tourism and present new opportunities.

The big question is whether corporate or insurer paid medical travel will get off the ground in 2012. Will employers and insurers see medical travel as a realistic and credible option to reduce healthcare costs. And will their client and subscriber base actually “buy in” to the medical travel option if it is offered to them?

Medical tourism..... global healthcare or regional medicine?
In 2012, there’s a risk that we get distracted by the trumpeting of “global healthcare”. It’s a nice turn of phrase, but in the real world, medical tourism is about regional medicine and cross-border healthcare; this is not going to change in 2012. In fact, the boundaries of medical travel may be drawn in, as travel costs increase. As travel costs climb, the concept of long distance medical tourism becomes less attractive. The imposition of hefty departure taxes in countries such as the UK, Germany  and elsewhere will reduce the cost advantages of some destinations.

If you are in the medical tourism business, ALWAYS remember that, for most patients, going abroad for treatment is a decision of last resort. AND that the further a patient has to go... further from their own country....further from their own culture... the greater is the actual and perceived risk. The patient needing major surgery who takes a five hour flight to a country with a different language and a different culture is a comparative rarity.

So is it medical tourism boom.... or bust?
The honest answer to this one.... is probably neither.  In recent years, we’ve listened to the hype........

.........to find out more about "Medical tourism: Trends for 2012 and beyond", read the full medical tourism article at IMTJ.

Believe what your customers do...not what they say!

To keep things simple, this blog has moved to the IMTJ web site. You can find the Health Tourism Blog here in future. Here's an extract of the latest blog post entitled: "Believe what your customers do...not what they say!"

A recent article in Harvard Business Review, “Four Simple Low Resolution Innovation Tests” highlights the problem faced by anyone who is considering investment in the medical tourism business. How can you know whether people will actually buy your service i.e. whether patients will actually travel abroad to use your services?

Much of the “research” conducted in the medical tourism sector is about what people say they will do.... not about what they actually do. For example, the 2009 Gallup Survey in the USA is frequently used to support the “booming medical tourism market” hypothesis.

The report on this Gallup poll was headed “Americans Consider Crossing Borders for Medical Care”. It found that “up to 29% of Americans would consider traveling abroad for medical procedures”.

Now the key words here are “will consider”. It does not say “will travel” or “have travelled”. And there lies the problem.......

.........Read the full article at IMTJ: Go to "Believe what your customers do...not what they say!"

Medical tourism: After the gold rush

To keep things simple, this blog has moved to the IMTJ web site. You can find the Health Tourism Blog here in future. Here's an extract of the latest blog post on "Medical tourism: After the gold rush"

Last year, I blogged about “Medical tourism...lessons from the California gold rush”. It’s taken me a while to write the postscript to this, but I finally got around to it last week when I spoke at the European Medical Travel Conference in Barcelona. (You can download my presentation “Medical Tourism: After the Goldrush” as a pdf file on the IMTJ web site).

In my gold rush analogy, I describe how in 2005/6, medical tourism became the next big thing.

In Google News for 2006, you’ll see headlines appearing like these:

• “One million medical tourists flocking to India”
• “Bumrungrad attracts more than 400,000 foreign patients each year”
• “Philippines is set to cash in on the $3-trillion global medical tourism market”
• “Half a million Britons travel for treatment....”
  

News stories appeared around the world about a surge in medical tourism. The first prospectors for “medical tourism gold” appeared - medical tourism agents and facilitators, overseas hospitals and clinics were seeking their fortune in the world of medical tourism. The tales of medical tourism gold began to multiply. Estimates of the number of medical tourists were in the hundreds of thousands, the millions, and then the tens of millions. Few medical tourism prospectors questioned the validity of these claims of the discovery of a rich vein of income or whether it was sustainable.......

.........Read the full article at IMTJ: Go to "Medical tourism: After the gold rush"

The medical tourism numbers game... Part 2

To keep things simple, this blog has moved to the IMTJ web site. You can find the Health Tourism Blog here, in future. Here's an extract of the latest blog post on "The medical tourism numbers game... Part 2"

The medical tourism numbers game... Part 2
Back in May 2008, I blogged on “McKinsey and the medical tourism numbers game..." and commented on their strange way of counting (or not counting) medical tourism numbers. Given the latest study on medical tourism numbers, “New study numbers US medical tourists in thousands not millions”, reported in IMTJ, I thought it was time once again to address the thorny issue of....how many medical tourists are there?

Defining the medical tourist
Before you can begin to count medical tourists, you have to be very clear about what it is you are counting. This is one of the greatest areas of confusion in the business sector.

So, what is a medical tourist?

In my view, a medical tourist is someone who travels outside of their own country for surgery or elective treatment of a medical condition. If we apply this narrow definition, we DO NOT include:

• dental tourists
• cosmetic surgery tourists
• spa and wellness travellers
• "accidental" medical tourists (business travellers and holiday makers who fall ill while abroad and are admitted to hospital)
• expatriates who access healthcare in a foreign country.

Read the full article at IMTJ: Go to "The medical tourism numbers game... Part 2".

Predicting future demand for medical tourism: Health tourism blog is moving to IMTJ

To keep things simple, this blog is moving to the IMTJ web site. You can find the Health Tourism Blog here, in future.

Here's an extract of the latest blog post on "Predicting future demand for medical tourism".

The latest data on hospital activity within the UK National Health Service provides a useful indicator of where future demand for medical tourism may lie. One of the advantages of the UK public health system is that with one provider....the NHS, and one payor....the NHS it means that an enormous amount of meaningful data can be captured about the state of the nation’s health, about demand for health services and about how the health profile of the population is changing.

Like many developed countries with established health systems, the UK is facing the challenge of meeting the needs of an ageing population at a time when there is massive pressure to reduce or put a hold on public spending, and in effect reduce expenditure on health services. All UK hospitals collect data in the same way (well almost...) and the data is collected centrally by the NHS.

The following data is taken from the recent report “Hospital Episode Statistics: Admitted Patient Care – England 2009/10”, published by the NHS Information Centre.

Take a look at how demand for NHS hospital services has changed over the last ten years. First let’s examine the age profile of patients admitted to UK hospitals:

In 2009/10 there were:

• 16,806,200 hospital stays, a 38 per cent rise on 1999/2000.
• 1,939,190 stays for patients aged 0 to 14; a 15 per cent rise on 1999/2000.
• 7,333,110 stays for patients aged 15 to 59; a 29 per cent rise on 1999/2000.
• 3,642,940 stays for patients aged 60 to 74; a 48 per cent rise on 1999/2000.
• 3,837,990 stays for patients aged 75 and over, a 66 per cent rise on 1999/2000.

Read the full article at IMTJ: Go to "Predicting future demand for medical tourism".

Comparing the costs of (accidental) medical tourism

Whereas much of the attention in the medical travel sector is focused on medical tourism (i.e. where the primary reason for travel is some form of surgery or treatment), a more established and mature market sector is the provision of healthcare services for the tourist or business traveller who falls ill when abroad.

The structure and maturity of this sector means that it is far easier to gather comparative data such as the cost of healthcare and actual treatment in different countries. Cost management is in the hands of the international insurers, the travel insurance companies and the assistance companies who negotiate prices with hospital providers worldwide.A recent analysis of travel insurance claims, published by the UK based travel insurer, Sainsbury’s Travel Insurance, provides an insight into the variation in hospital costs across the world and the rising trend in hospital costs.

According to their analysis:

• In 2009, a record number of people needed medical treatment whilst abroad.
• The most expensive country for inpatient hospital treatment was the United States, with the average hospital visit costing £6,000.
• The average cost of hospital treatment in a foreign country has climbed to £2,040 over the last 12 months, an increase of 6.25% year-on-year.
• The most significant increase in treatment costs were seen in Turkey (+10%), the USA (+10%) and Spain (+7.5%).
• Over the summer months (May to September), the most common reason for hospitalisation was gastroenteritis with the average bill for inpatient treatment amounting to £1,200.
• The most expensive hospital bills were for those who suffered a heart attack abroad, resulting in medical expenses that averaged £12,500.

It’s interesting that the international assistance companies who deal with these "accidental" medical tourists have shown little or no interest in entering the medical tourism business. They have everything in place to become the world’s number one facilitator and blow everyone else out of the market:

• They have a network of “approved” hospitals around the world.
• They facilitate treatment for thousands of international patients in foreign countries every day.
• They have call centres to deal with patient enquiries.
• They have extensive technology and systems to manage the patient process.
• They have people on the ground in major destinations who can provide local support.
• They have comparative data on treatment outcomes and comparative costs in hospitals around the world.

So, why haven’t companies like Europ Assistance, Mondial Assistance and AXA Assistance entered the medical tourism market and used their expertise to attain a dominant market position?

The answer is probably quite simple. The medical tourism market is just not big enough to be attractive to them, nor worth the hassle. Which is good news for the existing operators...but puts the medical tourism market opportunity in perspective compared to the long established international assistance market.

The slumbering giant of medical travel?

Where do you think the international patients' centre shown above is? Singapore? Thailand? Malaysia? India? Korea?

Read on to find out...

This week’s International Medical Travel Journal covers a recent announcement by the UK Department of Health (See: Liberated UK hospitals to attract medical tourists) that it plans to remove the cap on the proportion of income that NHS hospitals can earn from private surgery. NHS hospitals are allowed to treat private patients (both domestic and international patients) in addition to their primary responsibility for serving the needs of the UK public.

Many NHS hospitals have private patient wards or dedicated units which benefit from their location close to the extensive clinical resources and medical technology which are available with an NHS general or teaching hospital. These are well supported by private patients but these NHS units have been restricted in terms of their revenue potential; across the UK, NHS hospitals were not allowed to generate more than 2% of their income from private paying patients. Some individual hospitals were allowed to generate a much greater proportion but were still limited in their revenue earning potential.

At medical tourism conferences around the world, the UK gets barely a mention. Yet it ranks in the top ten destination countries in terms of medical tourist numbers and probably in the top five in terms of revenue generated (Source: Team Tourism Consulting 2010). London continues to attract high value medical travellers seeking expertise and quality rather than the lowest prices. The average treatment cost for these patients is around £20,000, and for individual patients it can be much more. London also benefits significantly from the related expenditure of these medical travellers e.g. accommodation for friends and family during these extended patient stays.

Private patient facilities at leading London teaching hospitals such as Moorfields Eye Hospital, Great Ormond Street Children's Hospital, Royal Brompton & Harefield Hospitals, Kings College Hospital, Royal Marsden Hospital, and Guy’s & St Thomas’ Hospital have always been attractive to international patients and they compete with other international centres of excellence in countries such as the USA and Germany . Indeed, these NHS private patient facilities earn more from international private patients (medical tourists) than they do from UK private patients.

The Harris International Patient Centre at Great Ormond Street (pictured above) is a good example. The Centre has 130 staff, working with over 170 clinicians in Great Ormond Street Children's Hospital. It’s bigger than most international patient departments serving “medical tourists” that you would find anywhere in the world. And it’s very busy. But, until now Great Ormond Street and similar NHS run international patient facilities have been limited by the private patient income cap.

That is about to change... London “the slumbering giant of medical travel” may wake up to some of the newly emerging opportunities presented by the international patient market:

• The London hospitals mentioned above have a long and impressive track record in attracting international patients.


• They were involved in medical tourism long before the term was invented.


• And they are able to provide quality and prices that will be attractive to many emerging source markets for medical travel. For example, if US derived medical tourism does eventually take off, and American patients can make significant savings by travelling to London for major surgery (not far short of those available in Singapore or Thailand), would London be an attractive option? Same language (...almost), same culture (...almost).

This American who travelled to Wales for surgery may be the start of a growing trend....

Medical tourism...lessons from the California gold rush

In 1848, gold was discovered in California by John Sutter, a German immigrant. News of the find spread rapidly and thousands arrived in search of their fortune. Prospectors came from across the USA, from Hawaii, Mexico, Chile, Peru and China. The California gold rush had begun. California’s output of gold rose from $5 million in 1848 to $40 million in 1849 and $55 million in 1851. But there wasn’t enough gold to go around....only a minority of gold miners made much money from the Californian Gold Rush...the best equipped, the best informed, the best organised and resourced.

Others also made money; the saloon owners (and brothel keepers!) who kept the prospectors entertained made a healthy profit, and so did the entrepreneurs and store owners who provided the supplies and tools that the prospectors needed (often at exorbitant prices).

Are there some parallels and some lessons here for those involved in the medical tourism gold rush?

The discovery of medical tourism gold....
Although the concept of travelling for treatment has been around for centuries, it was probably around 2005 when the medical tourism gold rush really took off; it still continues today and shows little sign of abating. News stories appeared around the world about a surge in medical tourism – patients travelling to save money on treatment costs (as opposed to seeking medical services and healthcare quality that were unavailable in their own country). The first prospectors appeared - medical tourism agents and facilitators, and overseas hospitals and clinics seeking their fortune in the world of medical tourism.

Word spreads, prospectors pursue the dream of medical tourism gold....
The tales of medical tourism gold began to multiply. Estimates of the number of medical tourists were in the hundreds of thousands, the millions, and then the tens of millions. Few medical tourism prospectors questioned the validity of these claims of the discovery of a rich vein of income or whether it was sustainable.

Those involved in the early gold rush exaggerated their successes, claiming massive finds (e.g. “one million medical tourists to....), encouraging others to join the frenzy. Healthcare providers in countries all over the world entered the race - Singapore, Malaysia, Korea, Jordan, the Philippines, Tunisia, Turkey, Eastern Europe, many of them backed by their tourism boards, health departments and government initiatives who saw medical tourism as a rich source of foreign currency.

....without thinking or understanding what’s really involved
New entrants pursued the dream without really thinking through their strategy and approach to the market. Some went into the market ill equipped; some went into the market without realising what it might cost to be successful; some went looking for medical tourism gold in completely the wrong place!

A community of medical tourism prospectors develops
As the number of medical tourism prospectors grew, others (the saloon keepers) arrived quickly to profit from this growing community, and store owners and tool suppliers appeared to guide the prospectors in their pursuit of gold.

The saloon owners arrived in the form of the associations and medical tourism conferences that make their money from membership fees and delegate fees. They provided a place where the prospectors could get together, but they also built on the hype, retelling stories of the latest discoveries and attracting more people to the medical tourism gold rush. Of course, the more people in the gold rush, the more people there are in the saloon, and the more money there is to be made by the saloon owner.

The entrepreneurs and store owners also arrived on the scene to provide the tools that the prospectors needed to mine medical tourism gold. Web sites like our own (Treatment Abroad) that link patients with providers, systems companies like Health Travel Technologies and e-Medsol that provide the systems to manage patients, and consultancies, strategists and advisers like Irving Stackpole and Vivek Shukla who help the prospectors to locate medical tourism gold came into being. Are these entrepreneurs and store owners (including my own Treatment Abroad "store") taking advantage of uninformed prospectors by providing poor quality services and products and overcharging for them. Or are they providing sensibly priced services and much needed tools that will bring long term success to those who use them wisely? Only time will tell.... and it will be the success of the prospectors who determine our success.

The gold runs out...or is harder to find and mine
As in the California gold rush, reality has failed to live up to expectations for many prospectors. Clinics, hospitals and facilitators are finding it harder to acquire patients and there’s a great deal of competition out there. Nevertheless, for many the gold rush mentality continues.

After the gold rush?
So, what’s the likely outcome of all this? What can we expect in the next stage of the medical tourism gold rush? In my next blog post, I’ll give some thought to who will strike gold and how will the industry develop.

New research paper provides insight into infertility tourism

A recent paper presented at the Annual Meeting of the European Society of Human Reproduction and Embryology in Rome highlights the growth of “infertility tourism” at a time when many medical tourism businesses are feeling the pinch of the recession.

The article, “Cross border reproductive care in six European countries” provides a review of inbound infertility tourism to six European countries receiving patients - Belgium, Czech Republic, Denmark, Slovenia, Spain and Switzerland. Data was collected from 46 centres in these countries. Patients came from 49 different countries, but almost two thirds came form only four countries - Italy (31.8%), Germany (14.4%), The Netherlands (12.1%) and France (8.7%).

Drivers of infertility tourism
Why are these infertile couples crossing borders for infertility treatment? It varies from country to country but the main driver is the law on infertility treatments within the home country. This is the predominant reason for patients coming from Italy, France, Germany, Norway and Sweden. Italian law banned sperm donation in 2004; German law bans egg donation; in France, assisted conception for single women or same sex couples is illegal and there is a ban on advertising for egg donors; regulation regarding donor anonymity affect Scandinavians and British patients; some countries have regulations that limit reimbursement of assisted conception to a maximum age.; some countries have legal limits on the amount that can be paid to donors thus reducing availability of sperm and eggs.

Difficulties in accessing treatment at home were a driver for a third of UK patients, and a wish for “anonymous” donation was expressed by around one in five patients.
There’s also some indication of specific cross border flows: Italians favour Switzerland and Spain, the Germans prefer Czech Republic, the Dutch and French opt for Belgium.
18.3% of patients were looking for semen donation, 22.8% for egg donation and 3.4% for embryo donation.

Market opportunity for medical tourism businesses?
The study estimated that “a minimum estimated number of 11 000–14 000 patients per year” visits the six countries in the study; it may well be much higher than this.

If you’re in the medical tourism business, download the paper; it’s a useful insight into the opportunities in infertility tourism and to the kind of patients that seek it..... which should be a major influence on your marketing. Understanding your market is key to the success of any medical tourism business. For example, the internet was a frequent source of information about infertility treatment abroad in Sweden (73.6%), Germany (65.0%) and the UK (58.5%).

So, it’s good news for my healthcare web publishing business that a Google UK search for “infertility treatment abroad” brings up Treatment Abroad at number 1 and our other sites in positions 2, 3, 4, 6 and 10 in the top ten Google UK results!

Light at the end of the medical tourism tunnel?

Following my outpourings on the “Outlook for Medical Tourism in 2010”, I am pleased to say that I’ve received some positive feedback (always a good thing.... I’ll keep on blogging!). And some reassurance that I am not alone in my view of the medical tourism world.

In particular, one of the long established medical tourism facilitators told me “how it was” in 2009 and how they think it might be in 2010. It’s refreshing to hear someone be open and upfront about their business experiences in medical tourism and the challenges that are facing people in the business.

I’d like to share some of these comments with others in the medical tourism world. Here is what it was really like in 2009 for one medical tourism business, a business that is well established, well run, and isn’t a “one man and his dog” outfit. I’m going to respect their confidentiality and not name the company concerned.

The view from the marketplace

Here’s what our medical tourism facilitator had to say about 2009:

“We have dabbled in the elective surgery market and have come to the same conclusions as you.... that to continue in this sector we would need to consolidate and concentrate on niche or rather more specialist sectors. Otherwise, we are finding ourselves becoming a "Jack of all trades and Master of none".

Last year was a really bad year. We were very busy with enquiries, but our conversion rate was disappointing and for those that did convert, the average spend was down. We have put the conversion problems down to a 50/50 mix of:

1. Recession - people not spending, or when they are travelling for treatment, they are spending less.
2. Competition - it seems in the last 18 months that every person in Europe, with a spare room and who knows a dentist, has jumped on the medical tourism bandwagon.

Another factor that has not helped is the pound sterling rate against other currencies, especially the Euro; this has meant a 20% increase in costs and prices. This does not only apply to the treatment cost but the patient stay while they are away. (Hotel rates are more expensive, eating out is more expensive etc.) The effect has been significant. Our patient numbers fell by 30% in 2009 and the average spend per patient dropped by 25%.”

So, a difficult time for this medical tourism business. But it is not unique. Some dental clinics in Europe have been relating similar experiences. One major implant centre in Budapest has reported overseas patient numbers down by more than 20% and a similar 25% fall in average spend per patient.

Do these experiences reflect the reality of the medical tourism business in recession?

Lies, damned lies and statistics?
The UK is one country where we count stuff. We have an Office for National Statistics and they employ around 4,000 civil servants who count stuff...including medical travellers. At Treatment Abroad, we do our bit to keep the civil servants in jobs by buying the data that they produce – specifically, the International Passenger Survey (IPS), a survey of a random sample of passengers entering and leaving the UK by air, sea or the Channel Tunnel. The IPS attempts to identify the number of people both travelling into the UK and out of the UK where the prime reason for travel is medical treatment (as opposed to business or a holiday).

Now.... you need to take these statistics with a very large pinch of salt. Statistics contain statistical errors and the smaller the sample, the bigger the risk of the error.

Here is a graph of IPS data showing outbound medical travellers from the UK from 2002 to 2009 (projected from 3rd quarter statistics). The sample size in this data is small - the number of actual travellers interviewed in each quarter who stated that their prime reason for travel was medical is around 50 to 100. So, there is room for wide variations in the data!

But, it may well be a reflection of the actual trends in UK medical tourism and for 2009 may indeed reflect the experiences of many in the marketplace who have seen the number of medical tourists in decline over the last 18 months or so, since the credit crunch hit.

Light at the end of the tunnel?
Our medical tourism facilitator quoted above has a more positive outlook for the future:

"We have already seen an increase in booking numbers for dentistry in 2010. January is already 100% up on January 2009 (and nearly the same number as in 2008, so something is starting to change.”

With some good news on the economic horizon in the UK, we may be seeing an increase in consumer confidence. House prices are increasing, and we have seen a return to economic growth, albeit not as good as many would have hoped. We wait to see what the effect may be on unemployment. But, like many industries, medical tourism follows the trends in the economy as a whole. Medical tourism is not immune to recession and certainly is not flourishing in it.

The way forward.. focus and think niche
Back to our medical tourism facilitator, who is planning the strategy for 2010:

“Our progress for 2010 will be to expand the dentistry further and concentrate more on the cosmetic surgery. We had taken a step back on cosmetic surgery in 2009, due to the difficult climate and similar to your (Keith Pollard’s) points about offering too much, we have recognised that rather than be a "Jack of all trades.....", we need to have a separate department. Having the same staff switching between the two products (dentistry and cosmetic surgery) does not really work.”

And our medical tourism facilitator concludes with a message for all in the industry:

“I totally concur with the conclusions of your article, and recognise that this medical tourism industry is not as simple and as great as people have made out. Only the companies that keep adapting and recognise the importance of focusing and having the correct resources to manage a particular sector of this industry will survive or be commercially viable.”

The outlook for medical tourism in 2010

Before looking forward to 2010, let's look back and assess where medical tourism is now. So, was 2009 a good year for medical tourism? In 2009, we heard medical tourism “experts” across the world continue to talk up the potential for medical tourism without any sound basis in reality. It’s in the interests of some within the industry to boost the profile of medical tourism and frankly to exaggerate its potential. But whereas some industry pundits talk in tens or hundreds of thousands of patients, others talk in millions.

These over optimistic forecasts have in themselves created a burgeoning medical tourism industry and a flurry of market entrants who may find that the going gets tough in 2010. Much of the current medical tourism sector has been built on hype rather than solid foundations. “In the land of the blind, the one eyed man is King” said Erasmus, and this has certainly been true in medical tourism.

Reality bites.... in the UK
The medical tourism sector is (a) not immune to recession and (b) is not going to thrive in a recession. The argument that people are more likely to look for low cost treatment overseas if money is tight just doesn’t stack up. How has the recession affected self paid treatment in a mixed healthcare economy such as the UK? The number of patients paying cash for elective surgery such as hip and knee replacements and the discretionary spend on cosmetic surgery is down 20% over the last 12 months. And the missing 20% are not going abroad because it’s cheaper. They are hanging on to their money, delaying treatment or deciding to spend their money on more essential outgoings.

Reality bites.... in the USA
For many new entrants to the market, the USA is seen as the “golden goose” of medical tourism. It depends what you read and who you believe. Compare these predictions and numbers:

For 2008

• Prediction: “it is expected in 2008 that several million Americans will travel overseas” (Medical Tourism Association).
• Reality: - outbound US medical tourist numbers declined to 540,000 in 2008 (Deloitte Medical Tourism Update)

For the future

• “23 million Americans could be traveling for medical tourism in 2017.” (Medical Tourism Association – Sep 2009).
• Recession adjusted forecast: 1.62 million medical tourists in 2012. (Deloitte Medical Tourism Update – Oct 2009)

Is either of these future predictions anywhere near the mark? What might be the factors influencing an upward or downward trend:

• Obama... the President who may change the way that the USA funds healthcare. And he’s making progress. Universal healthcare coverage in whatever final form it takes pushes medical tourism to the margins.... which is where it is in most developed countries. People do and will travel for treatment but it will always be a small minority wherever they are.
• Insurers, employers, HMOS’s..... We’re still a very long way from seeing funders of healthcare make a significant move towards using medical travel as a way of reducing healthcare costs. Will it happen? Yes... but slowly and at the margins.
• The recession isn’t over.... and it isn’t going away anytime soon. In both the US and Europe, unemployment levels hit 10% in December 2009. American workers have been unemployed an average of 29 weeks, the highest ever recorded since the data was tracked from 1948 onwards. Americans are visiting their physicians less, reducing the number of drugs they pay for. They are reducing their level of care. But as with the UK, large numbers are not offsetting this by pursuing lower cost options overseas.

According to a report in USA Today this month, medical tourism is number nine in the top ten travel trends for 2010 in the USA. According to USA Today, the three drivers are:

1. More coverage of overseas medical care by major U.S. insurers.
2. An increase in individual insurance policies that typically carry a high deductible.
3. A marketing push by companies that combine travel and medical services.

But will these drivers drive significant growth in the USA or elsewhere in the world?

• Some, but only a few, insurers will provide coverage....but will patients actually want to travel?
• There may well be an increase in deductibles....but will patients be able to afford to “top up” their healthcare anywhere....in their home country or overseas.
• Companies may well increase their marketing spend and may increase public awareness a little....but what we don’t have in medical tourism is a “big player”, a company that’s prepared to risk hundreds of thousands of dollars/pounds/euros in bring medical tourism to the masses.

So... is it medical tourism boom or bust in 2010?

Neither. Medical tourism is not the Holy Grail that will save holiday destinations around the world who are already suffering from the “let’s stay at home” effect of the credit crunch? It’s not the easy win for hospitals and clinics who have been adopting the “if we build it, they will come” approach. The reality is that we will see growth in the long term.....growth where medical tourism makes sense and not at the exponential rates that some have predicted.

The good news (for medical tourism) from the economic downturn is that every Western government is going to be under pressure to cut public expenditure and that usually means cuts in healthcare provision. Let’s take the UK as an example. The UK government knows that it cannot afford to fund the healthcare system as it has in the past. The UK national debt in 2010 is 72% of Gross Domestic Product; ten years ago, it was 33% of GDP. In Ireland, the Irish government unveiled one of the most severe budgets in the Republic's history embracing cuts in public expenditure across the board.

In many countries, the pressure on public funding of healthcare will be greater than ever before. In the long term, an ageing population demanding more healthcare and pressure on healthcare budgets will mean more patients funding their own care and looking at overseas treatment as a serious option. And that means there’s an opportunity for medical tourism.

Regional healthcare not global healthcare
In truth, there has never been a global healthcare market, and it’s unlikely that there will be one in the near future....unless, of course we:

• Invent an aircraft that can cut flight times by several hundred percent without increasing flight costs and global warming! Unlikely.
• Convince disparate healthcare systems worldwide to standardize the way they treat patients. It isn't going to happen.
• Get doctors in different countries to work together in providing continuous care for an individual patient (or at least talk to each other!). Some hope here, perhaps....

Where does medical travel really work...and happen? Across borders....from one neighbouring country to enough....within rather than between continents. However in need of treatment they are, and however desperate they are to save money, the number of patients who are prepared to board a plane and fly for eight hours plus to a different country with a different language and culture is minimal. It’s medical tourism at the margins. And it’s medical tourism that puts patients at risk through combining surgical procedures with long flights.

Patient flows in medical tourism follow low cost airline routes with short flight times or cross border land routes. Americans flying or driving South for surgery, Brits traveling to Budapest for dental treatment, the Japanese heading West to Korea for cosmetic surgery, the Indonesians travelling to Malaysia and Singapore, Central Africans heading for South Africa and so on.

The competition is going to get hotter
With medical tourism numbers failing to live up to the inflated predictions, we may now be faced with too few patients for too many providers. Those who have come to the market in the last twelve months are going to wonder where all the promised patients are. The simple laws of supply and demand mean increased competition. But that doesn’t necessarily mean that prices will plummet. Only the foolish will drop prices to attract patients. Consumers don’t opt for the cheapest when it comes to making healthcare decisions. Yes, they want to save money, but cheapest implies low, quality, risk...all those things that medical tourists are trying to avoid. Added value, customer service, creating new business from existing or past customers will all become important in differentiating your business, and attracting new patients.

New models for medical tourism?
The credit crunch, increasing competition, the slow growth in patient numbers (if we see any growth at all in the near future) will encourage new approaches to medical tourism. We’ve seen the Hungarian “dental tent” come to the UK, and we hear that cruise ship medical tourism is on the agenda of the European Medical Travel Conference. And perhaps in 2010, we may see the serious adoption and exploitation of telehealth and e-medicine in the medical tourism sector.

In a recession....find a niche
So, what can those pursuing the Holy Grail of medical tourism learn from all this?

One key to success in a recession is to find a niche and ideally one that is a recession proof niche - one that people spend their hard earned cash on when money is tight. Whereas many healthcare providers try to be all things to all patients, those that succeed will select their niche and focus their efforts.

There are some niche areas of healthcare that are relatively recession proof and may prove attractive. Infertility treatment is a good example:

• Public funding of infertility treatment is under pressure in many countries.
• The need is high and people aren’t prepared to delay treatment too long.
• Money may be tight, but having children is the one thing that they may spend money on rather than anything else.
• It’s high value.

There are others...get your thinking cap on and go out and find them.

In summary
2010 may be the year in which we see some rational thinking and some rationalisation in the medical tourism world. Perhaps the recession will bring some of the “blue sky” thinkers down to earth. New market entrants are going to feel the pinch; the long established players will maintain their reputation, improve their services and continue to thrive.

Long term, the medical tourism sector is here to stay.

Stay with it.... businesses that ride out the recession will come out of it in better shape. It’s still an attractive market sector and the business is there for those who take the long term view.