Academic journal article Journal of Healthcare Management

Can Inbound and Domestic Medical Tourism Improve Your Bottom Line? Identifying the Potential of a U.S. Tourism Market

Academic journal article Journal of Healthcare Management

Can Inbound and Domestic Medical Tourism Improve Your Bottom Line? Identifying the Potential of a U.S. Tourism Market

Article excerpt

INTRODUCTION

Medical tourism is generally considered to encompass "the act of traveling ... to seek specialized or economical medical care, well-being, and recuperation of acceptable quality with the help of a support system" (Keckley & Underwood, 2008).

Medical tourism can vary in scope in terms of tourist services offered (e.g., medical treatment is sometimes packaged with complementary sightseeing tours and other vacation-oriented services [Konrad, 2009]) and according to type of medical procedure (e.g" from dental procedures to cosmetic surgery [York, 2008]). Traditionally, the medical tourism model has focused on residents who leave their country to pursue care at a destination that may provide less costly care and a vacation-like experience. In terms of the U.S. medical tourism model, this segment of the market is referred to as outbound medical tourism and presents the potential for lost revenue for domestic healthcare providers. Inbound medical tourism involves providing services to patients from other countries who travel to U.S. facilities for treatment (Keckley & Underwood, 2008). Domestic medical tourism involves providing services to patients from other states within the United States.

In 2008, more than $5 billion was spent by the 400,000 non-U.S. residents who traveled to the United States for medical care, representing about 2% of hospital revenue. Most came from Europe, Canada, South America, and the Middle East (Keckley & Underwood, 2008). Typically, medical tourism does not encompass those patients who happen to fall ill while visiting another locale; the term is reserved for those who seek out medical care in another state or country (NaRanong & NaRanong, 2011).

Medical tourism is a niche business (i.e., a small market segment) within the overall U.S. healthcare industry. The future growth of inbound and domestic medical tourism is not assured. Even with potential benefits for patients and healthcare organizations, possible impediments include opposition from medical associations, government travel restrictions, lack of patient information in the relevant markets, and inadequate marketing efforts. However, a global and national market for healthcare services is likely to continue as long as patients from other countries or other states seek care in a given facility and are able and willing to pay the cost directly, or indirectly through insurance. In addition, large U.S. employers, including Lowe's, Boeing, and Wal-Mart, are entering into partnerships with Cleveland Clinic, Mayo Clinic, and other prestigious health centers to offer their employees complex surgeries at reduced or no cost typically at out-of-state facilities (Cheung-Larivee, 2012; Terhune, 2012).

While prior research has examined the patient experience of Americans traveling abroad for care, a gap exists in the literature related to domestic medical tourism, especially studies based on methodology in how to assess current trends and tailor marketing to target consumers (Guiry & Vequist, 2011; Hudson & Li, 2012). One review of the medical tourism literature found little hard data on patient flows, revenues, benefits, costs for various stakeholders, and effective strategies to address such challenges (Hopkins, Labonte, Runnels, & Packer, 2010). Most published information is anecdotal, derived from claims submitted by medical tourism brokers and from theoretical conjectures. Strategic marketing perspectives from the viewpoint of U.S. healthcare providers are almost entirely absent.

Another review concluded that research on medical tourism to date has been largely conceptual in nature, with major gaps in data analysis (Hudson & Li, 2012). Moreover, most research has focused on outbound medical tourism. In this article, we examine a case study of one large U.S. healthcare system as it begins to assess the market potential for both inbound and domestic medical tourism in an ongoing process to identify, assess, and market to their potential medical tourism target markets. …

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