General Overview on Medical Tourism in the World
As a result of increasing population of the world, demand for healthcare services also increased. Many countries, however, find it more and more difficult and more and more expensive to meet the demand for healthcare services.
Although in many countries economic growth rates have shrunk due to the global financial crisis, the cost of health care has increased. When the Organisation for Economic Co-operation and Development (OECD) health data (2013) is examined, it is seen that health expenditure as a share of gross domestic product (GDP) was on average 9.3% among the OECD countries in 2011. The USA had the highest health expenditure as a share of GDP with 17.7%. The lowest rate belongs to Turkey with 6.1% and Estonia with 5.9%. Average total health expenditure per capita in 2011 for OECD countries was US$3322. The USA has the highest per capita health care spending with US$8,508 for each person in 2011. Norway with US$5669 and Switzerland with US$5,643 follow the USA. Mexico with US$977 and Turkey with US$906 have the lowest health spending per person among the OECD countries (OECD 2013).
Due to globalization of healthcare services, imports and exports of health-related services emerged as an important sector. According to OECD, USA, France, Czech Republic, Slovenia, Poland, and Hungary are the most important healthcare exporters among the OECD countries (OECD 2013). Germany (with US$2.3
billion), USA, and the Netherlands are the top three health care-related importers in absolute terms (OECD 2013).
According to OECD health data (OECD 2013) in 2012, average waiting time for cataract surgery was longer than 100 days in Finland and Spain, and about 180 days in New Zealand. Average waiting time for hip replacement was over 150 days in Spain, and over 120 days in Portugal and Finland. Average waiting time for knee replacement was longer than 200 days in Portugal, about 150 days in Finland, and about 110 days in New Zealand. Waiting times from specialist assessment to treatment for knee replacement are showed in Fig. 12.1.
In most countries, healthcare expenditures are mostly financed by the public sector. In a few countries, such as the USA, private insurance plays an important role in financing the healthcare system. However, absence of social or private insurance or inadequate insurance coverage forces many households to pay for medical services out of their pocket and increasing healthcare costs make it more difficult for households to cover the costs. Increasing private health expenditure and out-of-pocket expenditure are also important drivers of medical tourism. Figure 12.2 shows the expenditure on health care by different types of financing.
Medical tourism, with 6 million patients involved, contributes US$45-95 billion to the global economy (Medical Tourism Association 2013). The cost of healthcare services in top medical tourism destinations (including travel and accommodation costs) is 10 times cheaper than in the USA (Deloitte 2008). As a result, it is estimated that 15.7 million American citizens will travel abroad in 2016 for medical purposes up from only 750,000 in 2007 (Deloitte 2008). According to the same report (Deloitte 2008) US medical tourists will spend US$49.5 billion in 2017.
Fig. 12.1 Knee replacement, waiting times from specialist assessment to treatment, 2006 to 2012 (or 2011) (OECD Health Statistics 2013)
Fig. 12.2 Expenditure on health by type of financing, 2011 (or nearest year) (OECD Health Statistics 2013). Data refer to total health expenditure
The survey result by the Medical Tourism Association (2013) also indicated that nearly three quarters of all patients involved in medical tourism are US citizens.
Although exact rankings may differ from one source to another, all sources consulted include the following countries in their top ten medical tourism destinations: Brazil, Costa Rica, Hungary, India, Malaysia, Mexico, Singapore, South Korea, Thailand, and Turkey (Positivemed 2013). According to Thailand Board of Investment, 2.5 million medical tourists visited the Thailand in 2012, and the number of medical tourists is increasing day by day. Thailand’s revenue from medical tourism was between US$ 4.0 billion and US$4.7 billion in the same year and US$3.2 billion in 2011 (Thailand Board of Investment 2014).
When the general structure of the medical tourism sector is considered, it is seen that the role of public health sector is limited. Public sector is usually undertaken the facilitator role in medical tourism. For this reason, the countries realizing the importance and promising structure of medical tourism such as Thailand, Malaysia, Singapore, and Turkey started to add strategies related to medical tourism in their strategic plan.
In some countries, governments also provide support for marketing and accreditation processes. Thailand and India founded national medical tourism agencies in order to increase their competitiveness in medical tourism (Turner 2007). India even developed a specific visa for medical tourists and uses revenue from medical tourism to make medical care more affordable to local people (Chinai and Goswami 2007).
Medical tourism is also being credited with improving the healthcare standards in developing countries (Connell 2011). One of the important indicators of increasing standards and quality is the number of accredited healthcare organizations. While the preferences of medical tourists enforce the accreditation of healthcare organizations to the international well-known and accepted accreditation organizations, quality of healthcare services is increasing automatically. This situation also increases the visibility of destinations in medical tourism sector. United Arab Emirates, Saudi Arabia, Brazil, China, and Turkey are the top five countries in the world in terms of the number of JCI-accredited healthcare organizations. Table 12.1 shows the number of JCI-accredited healthcare organizations by country.
Distance between the countries, the existence of a wide range of communication, and transportation networks affect the destination preferences of medical tourists. When these factors are taken into account, it is seen that European countries have advantages in the medical tourism sectors. In addition, the expansion of the European Union (EU) and the Schengen Agreement as well as a number of EU regulations also accelerated the circulation of medical tourists within Europe (Connell 2011; Glinos et al. 2010; Erdogan and Yilmaz 2012).