By the Blouin News Business staff

FEATURE: Thailand faces rivals for medical tourism throne

by in Asia-Pacific.

Thai hospital staff work in the isolation ward where a 75-year-old man from Oman was being treated for the Middle East Respiratory Syndrome (Mers) at Bamrasnaradura Infectious Diseases Institute in Nonthaburi province on June 19, 2015. PORNCHAI KITTIWONGSAKUL/AFP/Getty Images

Thai medical staff work at the hospital where the MERS patient is in isolation, 6/19/15. P. KITTIWONGSAKUL/AFP/Getty Images

The contrast is stark: while South Korea has seen Middle East Respiratory Syndrome (MERS) spread rampantly since it first appeared there in May, in Thailand the one detected MERS case last week has been limited to just that. It is no coincidence that Thailand is Southeast Asia’s top medical hub. The country’s well-developed health tourism infrastructure proved to be ideal for containing the spread of MERS — the Omani citizen who became Thailand’s first confirmed case is now recovering in quarantine in a hospital set up for exactly that type of high-risk patient.

Globally, medical tourism is estimated to be a $55 billion per year industry, and it is growing as much as 25% annually in some markets. The number of medical tourism patients at private Thai hospitals is estimated to grow 10.2% to 2.81 million this year. And private hospitals listed on the Stock Exchange of Thailand are predicted to generate over $3 billion in 2015, a 15% increase from the year before, according to Kasikorn Bank. Overall, the industry is worth over $4 billion per year in the country.

Some of Thailand’s rivals in the medical tourism industry are not doing as well. Singapore is ranked sixth out of 191 countries globally and the best in Asia by the World Health Organization, and it attracts around 600,000 medical tourists per year. However, due to its comparatively high prices it is losing patients to neighboring countries, where the quality of medical tourism is improving but costs are still lower. For example, a heart bypass in Singapore costs 41% more than in Thailand and 106% more than in Malaysia, according to BMI Research. The challenge facing Singaporean hospitals is exacerbated by declining government support for the sector, coupled with a strong Singaporean dollar making prices even more expensive for foreigners.

South Korea, meanwhile, has had not only its medical tourism ambitions dragged down by the MERS outbreak, but also overall tourism and the general economy. Around 180 people have been confirmed to have the virus in the country, with almost 30 dead and some 3,100 in quarantine. Two hospitals in Seoul have been shut down indefinitely, and on Thursday the government unveiled an emergency $13.5 billion stimulus package to try to boost the economy. Already tens of thousands of foreign tourists have cancelled trips to South Korea for fear of MERS, and this troubling medical reputation will linger on.

Two other rivals to Thailand are prospering, however. Malaysia’s medical tourism sector has increased ten-fold over the past decade, and the country recently won the prestigious Medical Travel “Destination of the Year 2015″ award, presented by the U.K.’s International Medical Travel Journal. Malaysia attracted almost 800,000 medical tourists in 2014, up from 770,000 in 2013, and it expects its income from medical tourism to grow 15% annually. Those earnings were about $195 million last year, and will reach an estimated $530 million by 2020.

India can also provide highly-skilled doctors at low prices — a hip replacement, for example, can cost $7,000 in India, compared to about $12,000 in both Singapore and Thailand (and over $40,000 in the U.S.). A 2014 study by consultants KPMG ranked India behind only Thailand and Singapore in medical tourism, with 25% growth per year. Last Friday, India established the National Medical and Wellness Tourism Board to further promote this growth industry. Some 1.2 million medical tourists are expected to visit India by the end of this year, and that number is likely to double by 2020, according to consultancy PwC. And the country’s medical tourism industry is expected to reach $6 billion by 2018, according to the Confederation of Indian Industry.

Still, despite the influx of revenue the medical tourism sector generates for these countries, the effects are not entirely positive for everyone. In Thailand, there are increasingly vocal complaints that foreign medical tourists are driving up the costs of residents’ healthcare, and that private hospitals are habitually overcharging because they can get away with it. Following public calls to set standardized prices for treatments and drugs, last month Thai Prime Minister Prayut Chan-o-cha instructed the Public Health and Commerce ministries to set median prices at private hospitals for medical care and medicines. In response, the Private Hospitals Association, which has opposed any suggestions of price controls, called on the government to study the facts before implementing any such actions. Meanwhile, Thailand’s poor often have to wait long periods of time to see a doctor at a public-run clinic for even the briefest of visits.

However, Thailand has had remarkably successful universal healthcare since 2001. And the consultancy Deloitte predicts that the Thai government will increase healthcare spending by 8% annually, to reach $18.7 billion by 2018. Granted, some inequality will remain between public and private hospitals — but that is nothing new, across many parts of the world. The government’s challenge is now to navigate a compromise course that allows the medical tourism industry to keep thriving, without causing an unchecked rise in healthcare costs for ordinary Thais.