Should local healthcare providers worry over flagging medical tourism?

Strong medical infrastructure provides an edge.

Local healthcare providers need not lose sleep over medical tourists flocking to Malaysia, Indonesia and Thailand, according to a report by OCBC. The decline of volume of medical tourists to the other countries is likely to be limited.

Singapore healthcare providers are still strong contenders in the region as they have established a strong brand. Also, local providers target premium-end customers, and are intent on enhancing expertise offering.

Further, while other countries hold positive domestic demographics, the supply-demand gap in healthcare infrastructure will take a few years to bridge. Their citizens, especially the high net worth ones, are likely to travel overseas for medical treatments in the medium-term.

In Thailand’s case, OCBC notes that the country is usually not considered to be direct competitors of Singapore as it is known for aesthetics treatments, thereby drawing in a different mix of patients as opposed to Singapore and Malaysia.

“Our view is also supported by the observation that regional providers are currently facing distinct domestic challenges ranging from regulatory limitations to talent crunch,” OCBC asserted.
Private sector players such as International Healthcare Berhad and Raffles Medical Group are likely to fare better in the face of the tight labour market, though, as they believe their branding strength and business model can attract the talent.