Is Medical Travel Good For The Host Country?

There was this New York Times article of June 1, 2008 titled "Royal Care For Some Of India's Patients, Neglect For Others." It describes the state of the art care in opulent surroundings received by a US medical tourist getting his heart valve replaced in Wockhardt Hospital, Bangalore. This is contrasted with the miserable plight of India's poor patients in government-run hospitals like the Bowring Hospital on the other side of Bangalore that lack the most basic equipment.

The article doesn't explicitly say this, but I hear concerns about medical tourists soaking up India's scarce medical resources that should instead serve its own people. Such sentiments are voiced by a small minority of populists and parochial elements in India. Interestingly I saw several such views expressed by US providers in forums discussing our own WSJ OpEd of May 27th. It reminds me a bit of the protectionists who seek to block cheaper foreign goods from entering the US because of their professed concern for the poor, exploited workers abroad.

But most Indian planners and leaders want to promote medical tourism. They believe that medical tourism is a win-win, to use a cliche, with benefits going beyond foreign exchange or trade gains, to actually help Indian patients. I fully subscribe to this opinion.

The elite private Indian hospitals we've talked with say that richer patients (including medical tourists) heavily cross-subsidise poorer ones. At a fraction of US rates, what is charged by elite Indian / South Asian hospitals may seem dirt-cheap by US standards. But payments by patients staying in luxury or deluxe rooms are far higher than for patients in wards or shared rooms in the same hospital. The higher revenues allow not just for cross-subsidy but also to enable the hospitals to acquire the advanced facilities and equipment, and to attract the most qualified doctors.

The private hospital "general ward" rates in turn are much higher than the cost of care in government hospitals. The increased revenues and demand should mobilize resources on the supply side. Luxury hospitals are sprouting all over the major cities. The one aspect that central planners must address is the need to vastly increase the supply of good doctors, nurses and other healthcare workers by plowing some of the revenues into expanding medical education and training. At least from their speeches and policy declarations it looks like the leaders and bureaucrats in healthcare are working on this issue.

So Western medical tourists are good for India and should avail of the facilities there with a clear conscience. Also remember that presently they make up a very small sliver of the total clientele of even the top Indian hospitals with JCI accreditation.