Medical Tourism to Help Drive Malaysia Healthcare Market
Malaysia has a large number of private hospitals (~220 in 2011), which offer Malaysians good access to a wide range of medical services through a nationwide network of hospitals and clinics. The private hospital services market in Malaysia earned revenues of RM7.48 billion in 2011 and is expected to reach RM13.79 billion in 2015 growing at a CAGR of 16.5% from 2010-2020.
Medical Tourism in Malaysia
The growth of the private healthcare market in Malaysia is driven not only by the domestic population seeking high quality private healthcare but also from medical tourists seeking treatments in Malaysia. Approximately 10% of the private healthcare market revenues are from medical tourists.
With its accessibility to Indonesia and Singapore, Malaysia’s high quality and reasonably priced private healthcare provides an attractive value proposition to patients in these countries. The ability of Singaporeans to use their health insurance funds (Medisave) at registered hospitals in Malaysia, favourable currency exchange rate and the comparatively high cost of treatment at private hospitals in Indonesia are additional driving factors.
To ease patient fears regarding the quality of care in a foreign country, international accreditations like JCI (Joint Commission International) are likely to become the prerequisite for hospitals targeting to participate in medical tourism. Stringent operational and stringent accreditation requirements are likely to escalate the clinical and operational quality standards, thus increasing market competitiveness. Malaysia currently has 9 JCI accredited hospitals.
The recent successful IPO listing of IHH Healthcare has also catapulted Malaysia’s status as a major player in private healthcare services market.
Expansion of the private healthcare market and the ability to market Malaysian private healthcare services beyond Indonesia and Singapore are going to be crucial factors in achieving these goals.
Opportunities in the Malaysian Private Healthcare Services Market
Malaysia’s healthcare revenues have largely been from domestic consumption, and some measure of exports from the medical device, pharmaceuticals and medical consumables industries. However, medium and long-term strategies in the areas of medical tourism, pharmaceutical exports, and medical education will form future economic growth engines in the healthcare sector.
The private healthcare sector in urban areas is already well served, and providers in Malaysia need to focus on specialty services or differentiation through focused specialty services and holistic healthcare. There is still opportunity in underserved towns for smaller day private outpatient clinics, as well as opportunities to promote Malaysian private healthcare services to patients such as from Australia or North Asia. Malaysian hospitals will need to ensure they continue with the focus on quality such as keeping up with JCI accreditation to attract these other medical tourists.
Malaysian healthcare is at crossroads due to its population growth, current healthcare infrastructure and initiatives of the Government to move ahead in this sector. The country is a rapidly growing economy in medical tourism and rising as a respected leader in the global healthcare community. However, the country’s educational infrastructure faces many hurdles that would strongly benefit from NEP resources and other additional support. In addition to any partnerships with international organisations, Malaysia has a myriad of opportunities for investors that can support the strengthening of its educational infrastructure to meet the demands of the future.
This article is authored by Rhenu Bhuller, Vice President of Healthcare, Frost & Sullivan Asia Pacific. The views expressed here are the personal opinion of the writer.
Photo credit: Featured image from Flickr user Aleera.