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India has emerged as a prominent medical tourism hub, yet the dynamic forces in the regional and global landscape are creating a complex balance of opportunities and risks for the Indian stakeholders. The outbreak of Corona virus pandemic in 2019 has further complicated the market dynamics for the medical tourism industry. This study aims to analyse the key driving factors for the medical tourism industry in India and the issues that Indian stakeholders should address in crafting a winning strategy. A qualitative research design was adopted, and data were collected through semi structured in-depth interviews with practitioners and senior representatives of the hospital management. The study adopted abduction logic and analysed data by means of constant comparison method. The study presents the assessment of the medical tourism industry in India and the scope of opportunity for Indian players.
The online version contains supplementary material available at 10.1007/s42943-022-00060-0.
Keywords: Medical tourism, Emerging countries, Destination competitiveness, Destination marketing, Drivers, Opportunities
Catalysed by emerging technologies, varying economic and demographic trends and a new age of healthcare consumerism; the worldwide scenario of healthcare is rapidly evolving. Additionally, a growing ageing population, and a swelling burden of diseases is rising the demand and cost of medical services. This evolution in healthcare is driving cross-country and cross-industry convergence (Deloitte Global, 2021), resulting in an upsurge in the worldwide medical tourism market. As this trend towards the healthcare is enduring around the world, more and more countries are extending their health systems to access care, not just for their natives but also gaining strength as leading service providers for international patients. While much of the initial focus was on the developed world, the epicentre is now shifting towards the emerging countries. Governments of these developing countries are working towards prioritising their health systems; enhancing productivity, boosting avenues for innovation and entrepreneurship, generating employment opportunities, increasing foreign exchange earnings, and hence driving GDP growth (Rahman, 2019).
India has been having its own unprecedented progress in this sector. To counter the emergent health issues, the health system in India has metamorphosed rapidly since the 90 s and has become the focal point of development. With the presence of clinical and technical expertise, international standards and highly competitive prices; India has emerged as a leading contender in the medical tourism industry (Bagga et al., 2020). Yet the accelerating shift in the regional and global landscape is making it challenging for the stakeholders to balance opportunities with risks. The industry is showing ramification of rapid disruption and intensified competition. Service providers are facing new playing fields. Recognizing this change alone isn’t enough. Government and entrepreneurs need to become adept at dealing with disruption and adapt the operating models, in a holistic way, to mitigate the outcomes of the shifting paradigm. It is imperative to introspect and identify the capabilities and resources that stakeholders need to realise. This is critical to endure the sophistication and competence of the medical tourism industry in India.
The outbreak of Corona virus pandemic in 2019 has further complicated the market dynamics for the medical tourism industry. Uncertainty over travel restrictions, changing quarantine measures across the world and the overall unprecedentedness of the situation, have made the entire ecosystem of medical tourism industry more precarious. With cross-border travel restrictions and the need to redirect hospital resources to treat COVID-19 patients, healthcare providers have to manage a dual burden of economic and health crises (Stackpole et al., 2021). The challenges posed by this pandemic have further demonstrated how crucial it has become for medical tourism industry in India to review their competitive positioning, access deeper competencies and build resilience.
A review of extant literature indicates very little empirical research has been done to done to examine factors of competitiveness of a medical tourism destination (Abubakar & Ilkan, 2016; Heung et al., 2010; Thayarnsin & Douglas, 2016; Yeoh et al., 2013). Theoretical understanding around the phenomena requires further academic attention (Chuang et al., 2014), specifically with regards to the perspective of medical tourism providers (Taheri et al., 2021). Virani et al. (2020) have also directed our attention to the neglect of policy-relevant research on medical tourism. This study aims to address this gap. By considering the perspective of medical practitioners and senior representatives of hospital management, this study identifies and analyses the key factors driving success in medical tourism industry and the issues that Indian healthcare providers and policymakers should address in crafting a winning strategy. Taking Delhi NCR as the context, this outlook propounds insightful research into the existing state of medical tourism industry in India, explores the dimensions and factors that can help India shape an effective ecosystem for this sector and suggests considerations for an optimum future of medical tourism industry in India.
The literature review encompasses a succinct discussion on the medical tourism industry, its global trends and the current state of Asian and Indian medical tourism industry, along with the key dimensions of medical tourism as highlighted in the literature.
Lack of specific data, novelty of the concept, and the fragmented and unstructured nature of this industry makes it challenging to review this industry and give an estimate of its size (Chambers & McIntosh, 2008; de la Hoz-Correa et al., 2018). Prominent market research databases have reported global medical tourism market to be worth USD 104.7 billion in 2019, and have projected it to grow at a CAGR of 12.8%, to reach USD 273.7 billion by 2027 (Chhabra et al., 2021; Taheri et al., 2021).
Even though there is no fixed estimate of this industry, medical tourism is well-considered amongst the most dynamically growing industries today. Trade economists have documented a strong impact of this phenomenon on the global economy (Bookman & Bookman, 2007) especially the emerging countries of the world (Lee & Hung, 2010; Pafford, 2009). It not only adds to their foreign exchange, but also boosts investments in the medical and tourism sector streamlining their services (Ramirez de Arellano, 2007). Asia has been specifically considered as a hub for medical tourism (Connell, 2006). Countries like Singapore, India, Thailand, Brunei, Cuba, Hong Kong, Hungary, Israel, Jordan, Lithuania, Malaysia, the Philippines, and the United Arab Emirates have emerged as major providers for healthcare services to international patients (Heung, et al., 2010). Several other countries like Mexico, Turkey, Brazil, Costa Rica, Argentina and Bolivia are also working toward establishing themselves as major healthcare destinations (Singh, 2008).
The global demand and expenditure for healthcare services is on a rise due to factors such as growing and ageing populations, changing disease patterns and rapid transformations in costly digital technologies. With the rising disparity in healthcare costs, governments, corporations and individuals are looking at outsourcing healthcare facilities to emerging markets (Turner, 2007), especially those with advance and cost-effective healthcare facilities, and a proximity to developed countries. Medical tourism is also a viable and economical option for uninsured or underinsured patients. On the other hand, there is a substantial disparity in the quality of healthcare services. Patients from countries with limited government spending on healthcare and under developed private sector are forced to look at options beyond their borders. (KPMG, 2014).
Last decade has seen Asia as an emerging leader of the medical tourism industry. This growth is fuelled by the availability of a variety of high quality and cost-effective medical procedures in Asia, improved connectivity and infrastructure and along with the presence of attractive locations to explore. The availability of advanced treatments in fields such as cardiology, neurology, orthopaedic, spine, ophthalmology along with aesthetics and alternative treatments like Ayurveda, Unani, Herbal and Yoga, makes Asia a sought-after destination. With private sector as the primary driver of medical tourism in this region, Asia has seen a faster growth of this industry vis-a-vis any other region globally. Many prominent healthcare providers in Asia are internationally accredited and have positioned themselves as distinguished service providers to patients from both within the region and far beyond. A market research on medical tourism industry anticipates the medical tourism market in Asia to cross USD 14 Billion by 2022 (iGATE Research, 2017). The research reports that Thailand, Singapore and India account for maximum proportion of international medical tourists in this region, followed by South Korea and Malaysia. Philippines and Taiwan are amongst other fast emerging markets in this sector. International patients contribute to a one-third or more of revenue in these private hospitals, and hence several private hospitals in this region are targeting this global world medical travellers’ market and have also gained a strong position for themselves in the industry (Mooter, 2017). An increased focus from government, foreign investment inflows and emerging startups are fueling up the competition not just between countries, but players as well. With the competition becoming stiffer, these countries and players are becoming more proactive in building their unique identifiers. Price is no longer the only factor of differentiation, countries are now looking at founding their proposition on parameters like diverse offerings, niche market, customized offering and even luxury (KPMG, 2014).
Healthcare is amongst the largest and most complex sectors in India and is poised to touch USD 133.44 billion by 2020 (Outlook India, 2019). Healthcare in India is becoming one of biggest industries in terms of revenue generation and employment as well. Giving further impetus to this industry is the medical tourism sector which is bolstering the level of enhancements of care services in India. Table A1, as given in Supplementary Appendix file, states some basic facts related to the medical tourism industry in India. With its key differentiating factors of extremely competitive pricing, highly trained doctors, high quality care and availability of a range of treatments, India has realized the potential of medical tourism and positioned itself as one of the largest service providers in this region (Connell, 2013; KPMG, 2014; Medhekar et al., 2019). A study by KPMG India and Google, has pegged the medical travel industry in India at USD 4.8 Billion in 2017 (KPMG India & Google, 2018). The pre-Covid estimations expected the Indian medical tourism market to reach USD 13 billion by 2020 (KPMG India & Google, 2018). Despite the deliberative effects of Covid-19 on Travel and hospitality industry, the Indian medical tourism was estimated between USD 5–6 billion in 2021 (Financial Express, 2022). A right combination of cost efficiency and quality has driven the growth of this sector in India. Table A2, as given in supplementary appendix file, gives a comparative cost chart, for some common procedures, between India and other major medical tourism destination. Further the presence of a robust private sector, with international accreditations, has reinforced India’s standing. India offers a range of treatments from cardiology, neuro, paediatrics, ortho, ophthalmology, urology, gynaecology, general surgery, dental, cosmetics along with traditional healing options (Qadeer & Reddy, 2013). As per a report by Ministry of Tourism, Government of India, around 4,95,000 medical tourists travelled to India in 2017, with Bangladesh, Afghanistan, Iraq, Maldives being the top 5 source countries followed by Oman, Yemen, Uzbekistan, Kenya, Nigeria and Tanzania (Ministry of Tourism, 2018). In the following years larger share of travel is expected from Africa and GEC countries (KPMG India & Google, 2018).Realizing the opportunity, Government of India has taken a few initiatives to promote and encourage the growth of medical travel to the country. These include Government of India’s health tourism policy; setting up a ‘National Medical & Wellness Tourism Promotion Board’ for regulatory, accreditation and marketing issues; accreditation of hospitals under the National Accreditation Board for Hospitals; dedicated website to promote medical and wellness tourism; promotions at international platforms such as World Travel Mart London, ITB Berlin, ATM, etc.; coverage under Ministry of Tourism's ‘Incredible India Campaign’; introducing separate category of medical visas—‘M Visas’; a proposal for setting up tourism circuits, along with a medical circuit which will connect modern medicine centres and Ayurveda; providing fiscal support and other benefits under Market Development Assistance Scheme (MDA); and lowering import duties on medical technology, equipment and machinery (KPMG, 2014; Medhekar et al., 2019; Ministry of Tourism, 2018).
This section presents the factors, as highlighted in the literature, that impact the development of medical tourism in a region. Cost and quality are considered amongst the most important dimensions of medical tourism industry (Aziz et al., 2015; Bagga et al., 2020; Cortez, 2008). Affordability and service quality of hospitality and tourism have also been considered as important attributes for a medical tourism destination (Chuang et al., 2014; Fetscherin & Stephano, 2016; Olya & Nia, 2021).
Several studies, e.g. Ghosh and Mandal (2019) and Fetscherin and Stephano (2016), have highlighted the importance of the type of treatments offered, medical facilities, practitioner competence, service quality and standards of medical care offered by the service providers (Kamassi et al., 2020). Technological upgradation and medical innovation are other important factors linked to the success in this sector (Cortez, 2008; Velasco et al., 2013). Literature also points towards the importance of trust, credibility, perception and hence the need for certification, international standards and accreditation (Debata et al., 2015; Hall, 2011; Seow et al., 2017).
Beladi et al. (2019) and Ebrahim and Ganguli (2019) have explored the role of human resource development and administrative efficiency. Infrastructure and facilities with regards to accommodation, transportation, communication are other important dimensions recognized for medical tourism (Heung & Kucukusta, 2013; Kamassi et al., 2020).
Medical tourism destination marketing, destination branding and tourism destination image have also been considered important with respect to the development of medical tourism in any region (Hoz-Correa & Muñoz-Leiva, 2019).
Studies have also observed public and private coordination and collaboration of the medical tourism stakeholders, to enhance the development of medical tourism sector (Beladi et al., 2019; Ebrahim & Ganguli, 2019). Government support and a favourable policy framework have been considered as important factors for this industry (Hall, 2011; Wang, 2012). Snyder et al. (2015) and Omay and Cengiz (2013) have specifically advocated the need for a regulatory framework and policy intervention to improve the efficiency coordination, uniformity and standardisation in this sector and promote the medical tourism industry (Momeni et al., 2018).
Considering the emerging nature of this industry, qualitative approach was exercised to truly analyse the value proposition of India as a medical tourism destination. A qualitative framework encourages both theoretical and applied knowledge and aids in the development of novel and alternate theories (Bygrave, 1989; Creswell, 2013). Case study method was adopted to classify and analyse the dimensions that can position India as a prominent healthcare service provider for overseas patients. Merriam (2002) describes case study as a comprehensive description and examination of a phenomenon or a social unit of study. The case being studied becomes the boundary of the research, and by focussing on a single context this approach seeks to offer an extensive enquiry and meaning of the phenomenon under study (Creswell, 2007; Miles & Huberman, 1994; Yin, 2011). For the present research, context was bounded geographically and the problem at hand was thoroughly explored in the Delhi-NCR region. As also suggested by Stake (1995), a holistic analysis of medical tourism industry in Delhi NCR allowed for an instrumental way to investigate the phenomenon at a broader level in India.
This study was conducted in Delhi NCR, i.e. National Capital Region of India. It includes Delhi, officially the NCT, National Capital Territory in India and several other regions neighbouring it; Gurugram, NOIDA and Faridabad being the prominent ones. Delhi NCR has witnessed an unprecedented growth in both, the healthcare infrastructure and as well as services in this last decade. The presence of corporate majors like Fortis, Max, Apollo; high-end hospitals like Medanta, Artemis; day care surgery centres and specialised centres, such as for IVF, eye care, birthing centres; has enabled Delhi NCR to emerge as a healthcare hub (Kachhap, 2012). Increased activity from the new corporate players have also spurred the existing older players like BLK, Gangaram and Moolchand to revive and widen their portfolio. These healthcare brands are consistently working towards building a strong medical tourism sector. With its robust medical infrastructure, advanced medical specialities, competitive pricing and highly trained doctors, Delhi NCR is amongst the most prominent healthcare destinations in India for international patients. These hospitals provide valuable services to medical tourists, ranging from special wards and lounges for international patients and their companions, translator services, international cuisines, accommodation services and the like. Moreover, its connectivity, location and rich cultural heritage and presence of international standards of hospitality make Delhi NCR a prime tourist destination. These factors make Delhi NCR an important context for exploring the medical tourism industry in India as a whole.
The qualitative approach and exploratory nature of this study maintains that the researcher becomes an agency for data collection. This enables the researcher to get close to the social phenomenon being studied and enable a deeper understanding of the social reality (Bryman, 1988; Marshall & Rossman, 1995). This also gives researcher the flexibility to delve into the issues that emerge during the study. The qualitative data for this study was collected by the researchers through semi structured in-depth interviews with senior practitioners, and senior members of hospital management. Conducting interviews allowed the researchers to apprehend wide-ranging perspectives and experiences of respondents with regards to medical tourism.
Potential participants for interviews were identified through purposive sampling, to ensure appropriateness, purpose and rich information. Participants were selected from multi-speciality hospitals, offering healthcare services to medical tourists, and through ongoing referrals from interview participants. Table A3, as given in supplementary appendix file, gives a brief profile of the respondents of this study. As a wide-ranging guideline for qualitative design, the study did not look for an increasing number of cases but aimed to collect an extensive detail from each case under study (Creswell, 2007). For this research the number of participant cases to be studied was not predetermined. Instead, taking reference from Maykut and Morehouse (1994), as the study progressed and data was analysed, additional cases required were determined by the extent to which each additional case would contribute to the understanding of the research problem. Data collection was concluded when it was realised that the emerging issues and themes were getting “saturated” and no new data was being found (Creswell, 2007; Glaser & Strauss, 1967; Strauss & Corbin, 1990, 1998). For this study data saturation occurred within 20 samples. Having a smaller sample size allowed the research to spend an extensive time with each case and encouraged that the understanding, of Delhi-NCR’s competitiveness as a medical tourism destination, which emerged was representative of the practitioners’ perspective (Shaw, 1999).
The interviews were conducted in the respondents’ hospitals. The interviews lasted for about 45 min. These were conducted face to face, were audio recorded, after checking with the participants, and later transcribed verbatim. Vital areas of concern were recognised after a thorough literature review on medical tourism and an appraisal of the dimensions of competitiveness of a medical tourism destination, identified by (Malhotra & Dave, 2022). These served as the guide for conducting interviews.
Data was analysed by means of constant comparison method as outlined by Glaser and Strauss (1967), Strauss and Corbin (1990, 1998) and Creswell (2007). Accordingly, data collection and data analysis were done simultaneously. This allowed the researcher to make necessary adjustment to the research process, such as, sample selection, and testing the emerging themes or concepts with subsequent data (Merriam, 2002). This study has adopted the ‘abduction’ logic for data analysis. An abductive analysis approach emphasizes that instead of keeping all predefined theoretical concepts aside, a researcher should enter the field with a broad theoretical understanding and during the research process develop and build upon their theoretical repertoires (Timmermans & Tavory, 2012). As also proposed by Lichy et al. (2020), since the data set for this study was modest in size, coding was conducted manually.
The theoretical background referred to in this paper is a study, by the same authors, on the dimensions and drivers of medical tourism industry. (Malhotra & Dave, 2022) previously developed this paper based on a systematic review of empirical studies on the medical tourism industry globally. The purpose of the study was to identify and analyse the factors and dimensions that influence the competitiveness of a country as a medical tourism destination. Figure 1 outlines the dimensions identified by their study. These are structured around the domains of medical tourism opportunity and a country’s positioning, infrastructure and health human resource competence, care delivery, governance and regulatory framework.