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Role of Health Tourism in Global Health Service Crisis

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Title: Role of Health Tourism in Global Health Service Crisis


1
Role of Health Tourism in Global Health Service
Crisis
Anil K MainiPresident Corporate
DevelopmentApollo Hospitals Group
2
Global Medical Tourism Market
  • Important source of revenue in developing nations
  • Revenues exceeded US 20 Billion in 2004
  • Revenues expected to grow to US 100 Billion by
    2012
  • Indian medical tourism growing at 15 annually

Source Medical Tourism Global Competition in
Health Care by Devon M. Herrick, November 2007,
National Center for Policy Analysis.
3
Strong Drivers for Medical Travel
  • Aging overseas population.
  • High cost of healthcare in developed countries.
  • Long waiting periods for tertiary care.
  • Large un-insured under insured healthcare
    market.
  • Lack of tertiary care facilities in developing
    and
  • under-developed countries.

4
Medical Tourism Patients
Recent McKinsey study identified the major
reasons patients travel abroad for medical care
  • 40 percent from less developed nations seek
    advanced, high quality care
  • 32 percent from developed nations seek higher
    quality care from advanced hospitals in
    developing nations
  • 15 percent from countries with socialized
    medicine who seek faster access and no waiting
    lists
  • 13 percent from developed nations seek healthcare
    at lower costs than available at home
  • Primarily from the U.S.

Fastest Growth Potential is in the Market
Segment Seeking Lower Costs
Source Mapping the Market for Medical Travel by
Tilman Ehrbeck, Ceani Guevara and Paul Mango, May
2008, McKinsey Quarterly.
5
Three key blocks of providers of medical tourism
Americas, EMEA and S/SE Asia
Americas
Europe / Middle East/ Africa (EMEA)
South / South East Asia
Americas
Europe / Middle East/ Africa (EMEA)
South / South East Asia
UK
Canada
UK
Czech Rep. Hungary
Canada
US
Japan
Czech Rep. Hungary
Antigua2 Mexico
US
Japan
Costa Rica
Philippines
Antigua2 Mexico
India
Barbados2
Thailand
U.A.E
Brazil
Costa Rica
Malaysia Singapore
Philippines
India
Barbados2
Thailand
U.A.E
Brazil
Australia
Malaysia Singapore
S. Africa
Australia
S. Africa
Source of medical tourists for South / SE Asia1
Providers of treatment
6
India Apollo An Emerging Healthcare Hub in
South-Asia
7
The Apollo Story
  • The Apollo Hospitals Group was started by Dr.
    Prathap C. Reddy in 1979
  • The Group started its first hospital in Chennai
    in 1983 with a initial bed strength of 150
  • Over the past 25 years the bed strength today
    stands at over 10,000
  • With over 44 managed and owned hospitals, Apollo
    is Asias largest healthcare network

8
Touched over 12 million lives6,40,000
Preventive Health ChecksTreated over 75,000
Foreign Patients from 75 countriesDone over
100,000 cardio thoracic surgeries Done 10,000
Kidney Transplants, 350 Bone Marrow
TransplantsFirst successful liver transplant in
India, at Apollo Delhi Pioneered interventions
and surgical proceduresApollo Delhi first
hospital to be accredited by JCI, in India
Apollo Group - Medical Achievements
9
Our Objective
  • To create a long term winwin Healthcare
    Delivery Strategy for overseas Patients and
    Payers.
  • To provide premier value-added services that
    allow overseas patients to effectively leverage,
    emerging cost effective global medical treatment
    alternatives.

10
Medical Health Travel
Medical Travel
  • Focused on treatment of acute illnesses, elective
    surgeries like Cardiology, Cancer, Orthopedics
    etc.

Health Travel
  • Focused on Wellness, Rejuvenation, Preventive
    Health, Image Health, combined with Traditional
    Medicine like Ayurveda, Yoga etc.

11
  • Is There a Drop in Medical Travel?

12
  • Yes
  • For Health Travel for cosmetic dental surgery,
    wellness etc.
  • No
  • For Medical Travel for high end Tertiary Care
    Quaternary Care
  • (For Life Threatening Diseases)

13
Patient/Market Profile for Medical Travel
  • Countries not having adequate healthcare
    services (SAARC, Middle East, Gulf, CIS and
    Africa).
  • Un-insured and under insured overseas patients
    mainly from USA. Large number of US Insurance
    majors Corporates looking at cheaper healthcare
    options, overseas.
  • Waitlisted patients in UK and Canada.
  • Patients seeking procedures not covered by
    Insurance e.g. Dental, Cosmetology, Bariatric
    etc.

14
Our Proposition
  • Clinical outcomes on par with the Worlds best
    Centers
  • Internationally qualified experienced
    Specialists
  • Technology Edge 3rd Generation equipment
    infrastructure
  • Competitive costs 1/10th of costs in the West
  • Quality of service

  • No waiting time
  • JCI Accreditation
  • Patient centric care
  • Choice of location for patients in India, among
    Apollo locations
  • Medications are also much cheaper, often 50 of
    that in the US
  • English speaking staff Doctors

15
Key Evaluation Criteria
  • Hospital reputation
  • Doctors training reputation
  • Cost
  • Post-operative care
  • Proximity
  • Convenience
  • Visa availability
  • Cultural similarities
  • Family and friends' recommendation

16
Main Super-Specialties Sought
  • Cardiology
  • Joint Replacements
  • Cosmetic Surgery Dental
  • Spine Surgery
  • Bariatric Surgery (Gastric Banding)
  • Cancer
  • IVF
  • Kidney Liver Transplants
  • Bone Marrow Transplant

17
Auxiliary Services
Services to the patients start from the moment
they contact the Hospital till the time they land
in India and leave back for their home country.
Some of these auxiliary services include
Airport pick-up drop Visa/Sightseeing
arrangements Translators Coordinating
appointments Accommodation for companions Locker
facilities Cuisine
18
Cutting Edge Technology

320 Slice CT Scan
PET CT
3.0 Tesla MRI
CyberKnife
19
Role of Telemedicine
Apollo is a pioneer in the field of Telemedicine
and is credited with being the first to set up a
Rural Telemedicine Centre in 1999.
Now, Apollo has established this concept in
overseas markets like Kathmandu, Lahore,
Khartoum, Lagos, Aden, Colombo Dhaka.
Soon, Telemedicine will be a very important cog
in the Medical Tourism wheel all Providers and
Facilitators will need to use it effectively.
20
Cost Advantage
PROCEDURE COSTS IN INDIA US
COST (US)
PROCEDURE
US
INDIA
Heart Surgery Bone Marrow Transplant Liver
Transplant Joint Replacements Cosmetic Surgery
9,000 30,000 60,000 8,000 5,000
100,000 300,000 350,000 60,000 50,000
21
Accreditation A Must
Apollo Hospitals, New Delhi
First Hospital in India to be Accredited by JCI
Apollo Chennai, Hyderabad, Bangalore, Ludhiana
Dhaka are also JCI Accredited
22
A Good Base To Build On
  • The next leap will come from
  • geographical growth internationally,
  • backed by sound brand and
  • product strategy

We Must Differentiate to Seek Greater Market Share
23
Turkeys USP
  • Europeans wallets have shrunk as a result of the
    global economic crisis, pushing them to seek ways
    to lower their medical costs.
  • That search has put Turkey on the map as a
    popular destination for those wanting lower-cost
    healthcare.
  • One thing that also plays to Turkeys favour is
    its high standards in medical care, as no less
    than 24 Hospitals and Clinics have JCI status,
    more than in almost every EU country.
  • In 2007, the number of foreign patients in
    Turkey was 150,000. Last year, the number of
    foreigners treated in Turkey increased by 40 to
    200,000.
  • Turkey mostly receives patients from the
    Netherlands, UK, Belgium France. There has also
    been an increase in Middle Eastern patients who
    have begun to prefer Turkey to Europe. Currently
    Turkeys medical tourism market is worth around
    US500 million, and it has the potential for many
    times that.


24
U.S. Market
25
U.S. A Worsening Problem
  • The US Census Bureau estimates that by 2020, the
    population of seniors, currently 13 percent of
    the total US population, will grow to 17 percent.
    This graying of America will propel the demand
    for healthcare products.
  • For people with good insurance or other
    financial resources, the US offers the best care
    in the world. But, for the 47 million Americans
    who lack insurance or the ability to pay,
    world-class care is a distant dream.
  • Patients with chronic illnesses represent the
    highest cost and fastest growing group in
    healthcare. The US healthcare system is not
    structured to manage them. Thus, a large number
    of Americans no longer have access to healthcare
    or are at grave financial risk if they get sick.
  • Little likelihood that these problems will be
    remedied for decades.

26
Broadening the U.S. Market Reach
  • 300M US population consists of
  • 47M uninsured
  • 8M with gt75K income 35-64 age range
  • 250M insured (of which roughly 40M are
    underinsured)
  • 150M employer provided benefits
  • 70M covered by self-insured companies
  • 80M covered by private insurance
  • 20M direct purchase of private insurance
  • 80M government provided program

Current retail target market is less than 3
Adding self-insured employers expands US market
opportunity ten-fold
27
Growing U.S. Medical Tourism Market
  • Estimated Medical Tourism 150,000 patients from
    U.S. in 2005
  • Most traveling to Latin America and Mexico
  • Estimated Growth
  • Possible increase to 500,000-700,000 patients per
    year
  • US33 Billion in potential cost savings
  • Option increasingly available through employers
    and medical insurance carriers

U.S. Market Will Increase Dramatically if
Insurance Companies Cover the Cost of Healthcare
Sources Patients Beyond Borders Everybody's
Guide to Affordable, World-Class Medical Tourism
by Josef Woodman, Healthy Travel Media, March
2007 Mapping the Market for
Medical Travel by Tilman Ehrbeck, Ceani Guevara
and Paul Mango, May 2008, McKinsey Quarterly.
28
WellPoint Serves Approximately 35 Million
Medical Members
WellPoint Overview
One in nine Americans have coverage from
WellPoint.
NY
BC or BCBS licensed plans
UniCare gt100K members
29
Wellpoint Inc. USA Press Release
  • Health insurer WellPoint Inc. will dabble in
    medical tourism next year when it launches a
    pilot program that sends patients to India for
    some surgeries.
  • WellPoint's pilot program will allow people to
    travel to hospitals in either Bangalore or New
    Delhi for procedures like joint replacement or
    upper and lower back fusion.
  • WellPoint subsidiary Anthem Blue Cross and Blue
    Shield in Wisconsin will set up the medical care
    and take care of scheduling and travel service.
  • The insurer will cover the travel and lodging
    costs for both the patient and a companion. It
    will offer the program only for people who
    receive insurance through Wisconsin-based
    Serigraph Inc., a self-insured printing company
    that employs about 700 people in the U.S. and
    does business in India, which was part of the
    reason WellPoint picked that country.
  •  

30
Medical Tourism Landscape
  • When would someone choose to leave the country
    for a medical procedure?
  • Respondents were willing to travel overseas
    for medically necessary or cosmetic procedures
  • Less than 30 percent with no incentives
  • 57 percent if travel expenses (airfare, meals,
    lodging) are covered for member
  • 67 percent if travel expenses are covered for
    member and one companion
  • 73 percent if travel expenses are covered for
    member and companion, plus a cash incentive
  • Anthem conducted an online survey regarding
    medical tourism
  • 160 consumers and 149 employers responded
  • 60 percent have traveled internationally

31
Proposed Incentives for Members
  • Members will have no member cost share for
    surgery claims when provided through the Medical
    Tourism benefit
  • No member copays
  • Patient can select a travel companion to
    accompany them
  • All travel arrangements and costs will be handled
    for the member and their selected companion
  • Airfare, hotel, transfers, visas, etc.

32
Why Medical Tourism
  • New trend emerging
  • Rising medical costs
  • Increased cost sharing for insured members
  • Consumerism
  • Lack of competition among providers domestically
    (geographic monopolies)
  • New tools for an increasingly savvy consumer
  • Global marketplace
  • American corporations losing competitiveness with
    health care cost trimming away profits

33
Guidelines for Identifying Procedures for Medical
Tourism
  • (1) The procedure is elective in nature
  • (2) The patient is able to travel
  • (3) The surgery is commonly performed at the
    referral hospital with demonstrable quality
    outcomes
  • (4) Local follow-up care upon return home can be
    arranged, if needed
  • (5) The patient can safely travel within a
    reasonable time, post procedure

34
Member Eligibility
  • Member Eligibility for Medical Tourism Benefit
  • Covered member or adult dependent (18 years or
    older)
  • Employer coverage must be primary coverage
  • Member must be scheduled for an eligible Medical
    Tourism procedure (see separate list of eligible
    procedures)
  • Member must be otherwise fit to travel, with no
    other complicating medical conditions
  • Member must be interested in the Medical Tourism
    benefit (Medical Tourism must be an optional
    benefit)

35
Member Experience
  • The Member

Talks to the surgeon to decide whether he or she
is comfortable with the surgeon Decides they want
to travel internationally for surgery Picks a
date for the surgery Travels with a companion of
his or her choice, through travel arrangements
made specifically for the member Has surgery at
an accredited facility with world-class surgeons
36
Apollo Research Findings US Market
37
AMA Guidelines for Medical Travel
  • (a) Medical care outside of the U.S. must be
    voluntary.
  • (b) Financial incentives to travel outside the
    U.S. for medical care should not inappropriately
    limit the diagnostic and therapeutic alternatives
    that are offered to patients, or restrict
    treatment or referral options.
  • (c) Patients should only be referred for medical
    care to institutions that have been accredited by
    recognized international accrediting bodies (e.g.
    Joint Commission International-JCI).
  • (d) Prior to travel, local follow-up care should
    be coordinated and financing should be arranged
    to ensure continuity of care when patients return
    from medical care outside the US.
  • (e) Coverage for travel outside the U.S. for
    medical care must include the costs of necessary
    follow-up care upon return to the U.S.
  • (f) Patients should be informed of their rights
    and legal recourse prior to agreeing to travel
    outside the U.S. for medical care.
  • (g) Access to physician licensing and outcome
    data, as well as facility accreditation and
    outcomes data, should be arranged for patients
    seeking medical care outside the U.S.
  • (h) The transfer of patient medical records to
    and from facilities outside the U.S. should be
    consistent with HIPAA guidelines.
  • (i) Patients choosing to travel outside the U.S.
    for medical care should be provided with
    information about the potential risks of
    combining surgical procedures with long flights
    and vacation activities.

38
Challenges and Perceptions U.S. Patients
39
Commonly Sought Procedures U.S.
General / Cosmetic surgeries and Cardiology
account for more than 60 of the procedures
40
Focus Value Ratings
While the general market is large, this procedure
is often covered by health insurance. However,
this is currently an area of excellence for
Providers meriting further investment.
  • Cardiac
  • Bariatric
  • Orthopedic
  • Transplant
  • Cosmetic
  • Fertility

Large and growing market. Frequently not covered
by health insurance. Procedure required by
individuals of all income levels. Motivation
includes cosmetic and health reasons.
Large market size, however this procedure is
often covered by health insurance. For those
without health insurance they may choose to
delay or avoid treatment rather than pay out of
pocket.
Small market size. This is frequently covered by
health insurance further diminishing the size of
the market.
Cost savings may not be sufficient to cover
travel costs, already a well developed market in
Latin America, does not correspond with hospital
brand image for complex procedures.
Small market size. South Africa has a
significant hold on this Segment of procedures.
41
Messaging
Cost Savings- same quality, but lower costs
Type of Procedure Median US Cost Combined Travel Treatment Cost Savings
Hip Replacement / Resurfacing 50,000 9,000 - 14,000 41,000 - 36,000
Knee Replacement 45,000 8,000 - 13,000 37,000 - 32,000
CABG (heart bypass) 100,000 9,000 - 14,000 91,000- 86,000
Heart Valve Replacement 125,000 9,500 - 15,000 115,500 - 110,000
Heart Pacemaker/Defibrillator 60,000 6,000 - 11,000 54,000 - 49,000
PTCA (Angioplasty) with Stent 70,000 6,000 - 12,500 66,000- 67,500
Spinal Fusion 75,000 7,000 - 13,000 68,000 - 62,000
Gastric Bypass 45,000 10,500 - 15,000 34,500 - 30,000
Laparoscopic Surgeries (Gall Bladder, Hysterectomy, etc.) 20,000 - 60,000 3,500 - 11,000 56,500 - 9,000
Source IndUSHealth Procedures and Pricing
2008.
42
Post-operative Care
  • Post surgery care is a major concern for most
    overseas patients.
  • Patients, who have returned to their home
    country, have expressed concerns over the ability
    to obtain prescribed medication or medical care,
    should there be complications after the surgery.
  • Medical institutions seeking to attract foreign
    patients should consider working with local
    hospitals/associations for referrals and offering
    complete care for the patient after they have
    returned to their home country.

43
Overall Thailand, Singapore and India are most
advanced in medical tourism ...
Thailand
Singapore
India
Malaysia
Philippines
No. of medical
tourists
660 K2
450 K
300 K
300 K
100 to 200 K
(2006)1
Annual growth

123

20

25

28

30
(from previous year)
Revenues from
medical tourists
750 Mn4
425 Mn
440 Mn
54 Mn
125 Mn
(2006 US)1
Revenues from

20-40

30-50

10-15

5-30

lt56
medical tourists
()
No. of hospitals

3

11

8

0

2
accredited by
JCI
Recognition

Top 10 international

Best medical/
Relatively new player
HC destinations
wellness tourism
in medical tourism
- News Week
destination
Lacks international
- Travel Weekly
recognition (e.g. no
2007
profile in Patients
without Borders)
44
... with differentiated positionings Based on
relative cost, quality, service, physical
infrastructure and types of specialties
Thailand
Singapore
India
Malaysia
Philippines
Positioning
Good quality
High end /
High end care
No clear
Low-cost quality
elective
complex
at the lowest
positioning
provider for
tertiary care
quality acute
price
overseas
with friendly
care
Filipinos and
service
Micronesia
Relative
Treatment price
Quality of
medical care
Service
Physical
Infrastructure
Wellness,
Focus
Quaternary
Tertiary
Elective
Wellness
Elective, Tertiary
Tertiary
Quaternary
Tertiary
Elective
( routine1 )
(routine)
Tertiary
Poor
Excellent
45
Key Strategic Considerations For Turkey, India
Asia
Medical Travel is a promising new industry in
India Asia, offering prospects for hospitals to
augment patient growth. It is with a clear
view of the addressable market potential,
internal strengths limitations, as well as the
level of external competition, that healthcare
providers facilitators may best move forward,
to realize this potential.
46
Our Goal
  • To make India the
  • Global Healthcare Destination

47
Thank You
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