Research medical tourism
A recovery in 2022 to drive near-term growth in healthcare markets in major emerging economies
The healthcare and medical device markets of many emerging economies are poised to benefit from a revival of medical tourism in 2022 as strict travel restrictions around the world are eased.
Medical tourism is the term used to describe people seeking elective, non-emergency treatment in a country other than where they reside. It is mainly driven by consumers in developed economies that have high healthcare costs, and by consumers in developing economies seeking higher quality treatment abroad.
While medical tourism is ubiquitous around the world, many countries stand out as key destinations for medical tourists and are supported by specific national government policies to drive growth. They include developed countries such as the United States, Canada and the United Kingdom and important emerging markets such as Thailand, Turkey, Brazil, Mexico, India and Malaysia.
Tourist numbers in 2022 are expected to rebound significantly after two years of pandemic disruption, although arrivals are likely to still fall below pre-pandemic levels in many countries.
In 2022, we expect the number of arrivals to increase significantly in many of these key emerging medical tourism markets. However, in many emerging markets such as Thailand, Malaysia, South Africa, Brazil and India, arrival numbers will still be depressed compared to 2019 levels. Mexico and Turkey will experience the stronger recoveries, with arrivals forecast for 2022 comparable to pre-pandemic levels of 2019.
Governments and businesses are taking steps to support and revive their respective medical tourism sectors. Thailand is a leading destination for medical tourism, supported by its highly developed tourism industry and low-cost, high-quality treatment services.
The Thai government reopened the country to foreign tourists in November as part of its strategy to learn to live with Covid-19. And while the emergence of the Omicron variant has led to quarantine-free entry being suspended, the Phuket Sandbox program remains an option and bookings for the province are said to be healthy.
Hospitals and businesses in Thailand are offering Covid-related services and are looking to revive medical tourism, with some providers offering high-end alternative quarantine stations for incoming medical tourists.
Turkey is another major destination for medical tourism, bolstered by its strategic location at the intersection of three continents, welcoming around 700,000 medical visitors each year before the pandemic. The government has sought to promote the medical tourism industry by establishing a new public agency, International Health Service (locally known as Ushas) in 2019 to promote and regulate health tourism.
Revenue from medical tourism can be a substantial source of revenue for some emerging economies and the recovery of medical tourism will support near-term growth in healthcare and medical device markets.
In Turkey, the share of health expenditure in tourism has increased from 1% in 2002 to 4.5% in 2020, according to data from Ushas. The country recorded over $1 billion in revenue in 2019 for foreign visitors and citizens living abroad visiting for health and medical reasons. That figure fell to just over $500 million in 2020 amid the pandemic and declining international arrivals.
In India, the government has sought to attract health-seeking visitors and develop the country’s medical tourism industry, which the Ministry of Tourism says could be worth up to $9 billion. India is a popular medical tourism destination for neighboring countries, with the largest number of medical tourists coming from Bangladesh, Afghanistan, Iraq and Oman.
Mexico’s medical tourism industry benefits strongly from its proximity to the United States, with many border towns being key destinations for American medical tourists. It is estimated that more than one million visitors from the United States travel to Mexico for medical care each year, representing a substantial source of revenue for the Mexican healthcare and medical device markets.
The increase in the number of Covid-19 cases or the emergence of new variants and the resulting travel restrictions remain a risk for the recovery of the medical tourism sector in 2022.
The tourism industry as a whole will continue to be exposed to Covid risks for the duration of the pandemic, particularly due to potential restrictions on travel resulting from the high number of cases. Travel restrictions will prevent tourists from seeking treatment abroad and could weigh on the growth of healthcare and medical device markets in many key emerging markets, as there is an increased focus on medical tourism.