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Medical tourism: Rs 100 billion by 2012

April 08, 2004 14:23 IST

Medical tourism can contribute Rs 5,000-10,000 crore (Rs 50-100 billion) additional revenue to the upmarket tertiary hospitals by 2012, and will account for 3-5 per cent of the total healthcare delivery market, according to the Confederation of Indian Industry-McKinsey study on healthcare.

India has immense potential in medical tourism as medical costs skyrocket in the developed countries, the study said.

Dr Naresh Trehan, chairman, CII national healthcare committee, said: "In comparison to most developed countries such as the United Kingdom or the United States, treatments like those for dental problems or major procedures like bypass surgery or angioplasty come at a fraction of the costs in India."

The current market for medical tourism in India is small and is mainly limited to patients from the Middle Eastern and South Asian economies. However, it could grow rapidly if the industry re-orients itself to attract foreign patients, the study pointed out.

For growth, the sector requires commitments from the government to build infrastructure for hospitals, create speciality tourist packages to include medical treatment, and promote hospital accreditation and standardisation, it said.

The hospitals would have to provide state-of-the-art facilities and improve the quality of in-patient care and service to make the overall experience attractive to foreign tourists, it added.

Changing demographic and disease profiles and rising treatment costs will result in healthcare spending more than doubling over the next 10 years. Private healthcare will be the largest component of this spending in 2012, rising to Rs 156,000 crore (Rs 1,560 billion) from the current level of Rs 69,000 crore (Rs 690 billion). It could rise by an additional Rs 39,000 (Rs 390 billion) if health insurance cover is available to the rich and middle class, the study said.

Besides, public spending could double from Rs 17,000 crore (Rs 170 billion) if the government reaches its target spending level of 2 per cent of the GDP, up from 0.9 per cent today.

With the expected increase in the pharmaceutical market, the total healthcare market could rise from Rs 103,000 crore (Rs 1,030 billion) currently (5.2% of GDP) to Rs 232,000 crore-Rs 320,000 crore (Rs 2,320 billion-Rs 3,200 billion) [6.2%-8.5% of GDP] by 2012, the study said.

The voluntary health insurance market is estimated to touch Rs 13,000 crore (Rs 130 billion) by 2005 from the current Rs 400 crore (Rs 4 billion), the study noted.


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