India’s growing medical tourism calls for increasing healthcare-IT collaboration

India’s medical tourism has grown rapidly in recent years, with an increase in foreign tourists from 183,000 in 2020 to 304,000 in 2021. HFS expects the medical tourism market to grow at a CAGR of more than 20% between 2023 and 2027 to more than US $35 billion from its current US $6 billion. The medical tourism ecosystem comprises healthcare providers such as hospitals and clinics, medical professionals such as surgeons and physicians, medical travel facilitators, government and regulatory agencies, insurance, and the hospitality sector, including airlines and hotels. Ecosystem players must accelerate transformation and digitalization across all functions to accommodate medical tourism growth. Their best bet is to partner with IT service providers that can apply their technical expertise to drive new efficiencies across the healthcare organization, improving technology and streamlining the business.

Holistic health, affordability, international hospital standards, and English language adaptability have supported the growth of Indian medical tourism

India is increasingly becoming the preferred medical treatment destination for people from the Middle East, Africa, and some Western countries such as the US and UK. India was ranked 10th out of 46 countries in medical tourism by Medical Tourism Index 2020-21. People have been traveling for treatment from around the world to cities in India like Delhi, Mumbai, Chennai, Hyderabad, Bangalore, and Kolkata. Healthcare facilities in all these cities have improved standards to align with international visitors’ expectations. The government has made it easy to visit India for medical purposes by creating a new category of visa, the Medical Visa, and establishing a dedicated fund, providing financial assistance to approved tourism service providers. It also launched the interactive “Advantage Healthcare India” portal to provide information to prospective medical tourists.

There are four primary drivers for India’s medical tourism growth:

• Affordability: India’s cost of living is lower than many other countries, and treatment can be much more affordable here than in other countries.
• International standard hospitals: India has 41 Joint Commission International (JCI) accredited hospitals and more than 1,400 National Accreditation Boards for Hospitals and Healthcare Providers (NABH) accredited hospitals. JCI accreditation is the world standard in global healthcare, and NABH is a constituent board of the Quality Council of India.
• Language: English is spoken in many hospitals, making patient communication easier.
• Visa challenges: The Indian government has been promoting India as a medical tourism hub and has been lenient regarding travel visas related to medical treatment. It has launched e-visas for medical travelers from 156 nations.

HFS believes affordability is the leading reason for growing medical tourism. Exhibit 1 shows that the cost of medical procedures in India is significantly lower than in the USA and many other countries. This cost difference has made India a popular destination for medical tourism, especially for those seeking affordable yet high-quality medical care.

Exhibit 1: India’s medical tourism provides quality care at a fraction of global prices

*The US is not normally considered a medical tourism destination due to its high healthcare costs.
Source: HFS Research and MediConnect India, 2023

Post-COVID, there has been a rise in the adoption of the AYUSH (Ayurveda, Yoga and Naturopathy, Unani, Siddha, and Homeopathy) system of medicine, which targets holistic healthcare improvements. AYUSH is an Indian system of medicine primarily practiced in southeast Asia; India is one of the biggest centers. AYUSH helps achieve a balance between the mind, body, and spirit. This holistic approach can provide patients with a more comprehensive approach to healing, helping patients achieve better overall health and well-being and leading to faster recovery times. Recently, India launched a “Heal in India” campaign targeting holistic healing using AYUSH.

Medical care in India has many benefits and a few drawbacks

Integrating traditional practices like AYUSH with modern medicine offers a holistic approach that many international patients find appealing. However, like any system, it’s not without its challenges. There are some downsides to receiving medical treatments in India, as listed in Exhibit 2.

Exhibit 2: Medical treatment in India has many advantages and minor drawbacks

Source: HFS Research, 2023

There are countless opportunities to leverage emerging tech across the healthcare ecosystem

Indian healthcare ecosystem stakeholders should look toward technology service providers to streamline their operations and improve patient experiences and health outcomes. India’s government is implementing policies to support medical tourism, provide a framework and direction, and create infrastructure. Most of the work will be done by PPP (public-private partnerships), which would open a plethora of opportunities for IT and BPS firms. Exhibit 3 shows the healthcare provider value chain and some critical opportunities for IT service providers in India’s medical tourism industry.

Exhibit 3: Service providers must work to offer services across the value chain

Source: HFS Research, 2023

A healthcare provider is one of the components of a vast Indian medical tourism ecosystem, which opens many opportunities for all parties involved.

Like the healthcare provider ecosystem, each stakeholder has its value chain elements. These value chain elements can be transformed and streamlined with the help of service providers providing their IT and BPS expertise. Exhibit 4 provides a snapshot of how IT and BPS expertise can help transform and optimize various value chain elements across different stakeholders in the healthcare provider ecosystem.

Exhibit 4: Service providers must work to solve multi-dimensional challenges

Source: HFS Research, 2023

The Bottom Line: India’s medical tourism growth presents a win-win opportunity for India’s healthcare ecosystem, IT service providers, and health consumers.

India’s rank of 10th of 46 countries in medical tourism shows India’s strength in medical tourism. It suggests substantial room for growth and improvement and India’s potential to become a top medical tourist destination. The nine countries ahead of India in the top 10 include Canada, Singapore, Japan, Spain, United Kingdom, Dubai, Costa Rica, Israel, and Abu Dhabi. India should investigate neighboring countries like Singapore and Abu Dhabi to learn about their flourishing medical tourism ecosystem. India must adopt a multifaceted approach across medical infrastructure, visa-related processes, insurance firm collaboration, healthcare business process outsourcing (BPO), the legal framework, and research. A comprehensive strategy can help India strengthen its position sooner.

To support Indian healthcare growth, collaboration between healthcare ecosystem players and IT service providers is crucial. These alliances offer tangible benefits to all participants while driving progress toward better patient care. By working together closely, stakeholders stand to reap rewards such as improved patient experiences, better outcomes, and sustained advancement within this pivotal sector.