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Transcript of June 27, 2017 I Ratings Medical Tourism - Does India Have ... Tourism... · Health Scheme). As of...
With continuing advancements in the medical procedures, relatively cost
effective treatments and well-experienced doctors, CARE Ratings expects
medical tourism in India to grow at a healthy CAGR of around 20%1 over
FY2018-2020. The large multi-specialty chains and super-specialty
hospitals are likely to be the largest beneficiaries of this trend. Based on
its analysis of sixty-one hospitals in its rated portfolio, CARE Ratings
believes that the incremental bed capacity targeted towards medical
tourists is seen not only in metro cities, but is also witnessed in the smaller
non-metro cities like Cochin, Madurai, and Indore amongst others.
Overall, the hospital sector in the next three to four years is likely to see a
25% increase in the beds largely in the non-metro regions and of this
about 20% is targeted specifically towards medical tourists. Addition of
capacities, technological advancements in the medical procedures and
overall improvement in the quality of healthcare provided by private
players shall be the key drivers for medical tourism.
Medical Tourism – What makes a patient travel?
Medical tourism, loosely defined, refers to patients travelling across
countries to receive medical treatment. This can include people of the host
country settled abroad returning for treatment or foreign nationals
travelling for medical treatment. With increasing focus on healthcare during the past decade and with
improvement in the quality of treatments available at affordable costs, India is upping the ante to become a
preferred country for quality healthcare, mainly in the ASEAN (Association of South East Nations) and MENA
(Middle East and North Africa) regions. The attractiveness of a location for foreign patients to undergo
treatments is mainly based on the following factors:
- Quality of healthcare and treatment facilities
- Cost of healthcare and medical procedures
- Availability of alternative treatment methods like Ayurveda & Homeopathy
- Legal framework and ease of access
1 in revenue terms
June 27, 2017 I Ratings
Medical Tourism - Does
India Have An
Advantage?
Contact: Harihara Subramanian C Senior Manager [email protected] +91-44-28490876
Sandeep P Associate Director [email protected] +91-44-28497812
Amod Khanorkar Senior Director [email protected] +91-22-67543520
Mradul Mishra (Media Contact) [email protected] +91-22-67543515
Disclaimer: This report is prepared by Credit Analysis &
Research Limited [CARE Ratings]. CARE Ratings has taken
utmost care to ensure accuracy and objectivity while
developing this report based on information available in
public domain. However, neither the accuracy nor
completeness of information contained in this report is
guaranteed. CARE Ratings is not responsible for any errors or
omissions in analysis/inferences/views or for results obtained
from the use of information contained in this report and
especially states that CARE Ratings has no financial liability
whatsoever to the user of this report
Ratings I Medical Tourism – Does India Have An Advantage ?
2
World class facilities and quality of healthcare in India
The healthcare sector in India has seen vast improvement in the facilities and quality over the past years. The Central
Government Health Scheme (CGHS) has made it compulsory for hospitals to be ‘National Accreditation Board for
Hospitals & Healthcare Providers (NABH)’ accredited if they are empanelled under the CHS (Central Government
Health Scheme). As of June 2017, there are four hundred and fifty eight such NABH-accredited hospitals in the
country. NABH is an institutional member as well as a Board member of the International Society for Quality in
Health CARE (ISQua).
Furthermore, there are thirteen private hospitals in India who have received accreditation from Joint Commission
International (JCI2). Some of these include Apollo Hospital at Chennai and Bengaluru; Fortis Hospital at Mohali,
Mulund and Bengaluru; Artemis Health Institute; Narayana Hrudayalaya Health City. Accreditation by JCI adds
credibility to the hospitals and reiterates the high standards followed in medical procedure in such hospitals and
medical centers.
Cost of medical treatments – India vs. World – a comparison
India is favoured destination among other nations for critical medical procedures involving cardiology, coronary artery
bypass, cardiac valve replacements, hip replacements and knee replacements amongst others. Most of the above-
mentioned procedures are critical and unilaterally most of the foreign patients choose to travel to India for these
procedures. The drivers for this include high quality infrastructure and medical equipment available in Indian hospitals
and presence of well-qualified and experienced medical consultants and surgeons. When such a quality treatment and
that too at relatively lower costs, is available in a country compared with other nations, it acts as a perfect prescription
for inbound medical tourism.
Source: Ministry of Tourism, OECD & Industry Sources
2 JCI is a USA based non-profit organization that accredits health care organizations, medical services and programs around the world. JCI
provides international accreditation, certification and also works to improve patient safety & quality of health care in the international
community.
Ratings I Medical Tourism – Does India Have An Advantage ?
3
India is amongst the lowest in terms of cost for most of the medical procedures. However, the disparity in costs
between nations like Singapore, Thailand, Malaysia, is not so large as compared with the western countries. Yet, the
quality of facilities in hospitals in India along-with better, wider and cost-effective options for the stay of the
accompanying person is a driving factor for the patients, particularly in ASEAN and MENA region, to travel to India.
A brief look at the exhibit above indicating the costs of few of the medical procedures in western countries and in
India brings out the fact that costs in India are much lower for most of the procedures. Apart from competitive
professional charges of the doctors, this can be attributed to lower labour, administrative and drug costs.
The currency exchange rates between the source-destination countries also make a significant difference in the overall
cost of treatments. However quality treatment remains a prime deciding factor.
Other drivers favouring India
Hospitals adhering to world class quality standards, accredited by agencies like NABH & JCI and relatively lower
treatment costs have spurred medical tourism in India in the past. Furthermore, most of the medical consultants and
surgeons in Indian hospitals have undergone higher medical education in the west and have also practiced in some of
the leading medical institutions across the world at some point of time in their career. This makes India stand out as a
preferred destination, where medical treatments available are of high standards comparable to that in the developed
western countries, but at significantly lower costs. Foreign patients also prefer India for the ease of communication as
most of the medical practitioners and support staffs are fluent in English language.
In terms of general Infrastructure and logistics capability, the country still falls below the competition. However, the
last few years have seen quite a bit of development on the infrastructure front. Air travel which is one of the important
drivers of medical tourism has seen a tectonic shift. Expansion of airports and establishment of newer airports,
increase in the number of airlines operating both domestic as well as international flights augurs well for the
development of the sector. Revamp of some of the airports and opening up of newer airports near some of the
healthcare clusters like Mumbai, Chennai, Cochin, Nagpur and Hyderabad has improved access for the patients.
The Government has also been continuously giving thrust on the development of medical facilities in India both for
ensuring better health and hygiene for its people and also for improvement of medical tourism. The Ministry of
Tourism has constituted the National Medical & Wellness and Tourism Board in order to provide a dedicated
institutional framework for promoting medical tourism. The Government has introduced an e-Medical visa which has
been extended to the nationals of 161 countries. The window for application of e-Visa has also been decided to be
increased from 30 days to 120 days and duration of stay from 30 days to 60 days with triple entry on e-Medical visa.
All this has been aiding the growth in Medical Tourism in India in the past few years.
Ratings I Medical Tourism – Does India Have An Advantage ?
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Source: Ministry of Tourism
According to figures available with the Ministry of Tourism (MOT), from 2013 to 2016, the number of tourists who
have visited India under medical visas has increased at a healthy CAGR of 20%. In 2013, a total of 56,129 people
came to India on medical visas which increased to 75,671 and 134,344 in 2014 and 2015, respectively. Until June
2016, the number stood at 96,856, which is an annualised growth of about 41%.
Source: Ministry of Tourism
While the total number of in-bound patients travelling annually from USA and UK has been stable in the range of 475
to 515 individuals between the years 2013 and 2015, number of patients from countries like Bangladesh has grown at
a CAGR of 52% during the above-mentioned period. This is mainly because of the lack of quality healthcare
infrastructure in the neighbouring Asian country. Furthermore, for Bangladeshi nationals, India seems to be a better
option due to the proximity and also as both nations share similarity in food and culture.
In the recent past, India is also witnessing increasing number of patients from Middle-East countries like Yemen,
Oman, Iraq and South Asian countries like Afghanistan and Pakistan. Number of people travelling under medical
visas from these countries has increased from about 14,194 in 2013 to 30,723 in 2016 (January - June).
Ratings I Medical Tourism – Does India Have An Advantage ?
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Credit Rating dispersion of CARE Ratings’ hospital portfolio
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