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Canada is renowned for its government-funded healthcare system, enviable to many foreigners but increasingly criticised by Canadians for long waiting times and a shortage of doctors. The latter issues are leading to a growing outbound market for medical tourism. At the same time, as many Canadian hospitals have been faced with insufficient government funding, they turn to foreign patients ready to pay for medical procedures in Canada.
Currently, both inbound and outbound medical tourism expenditure accounts for a small portion of total tourism expenditure in Canada. Opportunities for further growth exist in both segments, although a threat to inbound medical tourism is that it has come under increased government scrutiny.
Outbound medical tourism in Canada continues to grow. Although still only accounting for a small percentage of the overall C$31 billion spent by outbound Canadian travellers, medical travel is seeing double-digit growth.
Common procedures such as joint replacements, cardiac surgery and eye surgery have steadily risen in demand. While much of this work is covered under provincial healthcare systems, waiting times in Canada have steadily increased, in some cases reportedly to over 280 days. Additionally, cosmetic surgery, fertility treatments and some forms of elective surgery are generally not covered under provincial healthcare insurance, while demand for these procedures is also growing.
With increasing standards of healthcare in foreign countries and availability of information through technology, Canadians are looking to foreign destinations to have the work done and dovetail that with holiday time for recovery.
In Canada, outbound medical tourism is provided by speciality operators, such as Angels of Flight and Surgical Tourism Canada, which have established partnerships with foreign medical practitioners and tourism service providers in other countries. Medical tourism destinations include Costa Rica, Thailand, Mexico, Barbados and Israel, as well as a host of other countries. Speciality medical tour operators also transport patients within Canada if necessitated by availability of procedures, waiting times or insurance coverage problems.
By contrast, medical tourism into Canada, while on the rise, is faced with a number of challenges due to the publically funded nature of Canadian medical services. Many Canadian hospitals have been offering treatment for foreign patients, such as, for example, the Hospital for Sick Children, McGill University Health Centre, University Hospital Network (Toronto Western, Toronto General Princess Margaret Hospital) and Sunnybrook Hospital. Industry sources indicate that in Toronto alone the three hospitals and one rehabilitation clinic within the University Health Network treated 380 international patients from 2011-2014, while the Hospital for Sick Children treats about 200 patients annually. However, such arrangements are typically done on a case-by-case basis within hospital administrative circles and without open marketing of healthcare services to foreign patients.
This situation has received more public attention in 2014 when Toronto’s Sunnybrook Hospital began a pilot programme to openly accept international patients and market its services openly outside of the country, something that has not been openly done before. This approach is critical for many healthcare institutions with funding received from government budgets that has been reduced in recent years. The announcement and media spotlight, however, drew the attention of the provincial health ministry. The latter expressed concerns that opening up medical services to foreign patients will lead to public funds being directed towards treatment of such patients while, at the same time, displacing Canadians already subject to long waiting times. While inbound medical tourism has the potential to subsidise public costs, there is widespread objection on the grounds that this will lead to a two-tiered system and remove beds that could otherwise be used for Canadians. Hospitals reply that there is unused capacity in the system that is suited for international patients who are willing to pay the full cost of treatment.
An ageing Canadian population, the affluence of older consumers and the challenges of the current healthcare system to keep up with demand will support outbound trips for medical reasons. Employer medical insurance is similarly trending towards more restricted coverage, as costs for uninsured medical work climbs. Increased levels of confidence in foreign medical capabilities and lower costs offshore will underpin growth in outbound medical tourism. With this growth, opportunities exist for established medical tour operators to leverage rising demand in servicing the unique needs in planning medical travel. However, this will favour incumbents, as the number of speciality operators in this niche is not likely to rise given the required expertise and limitations imposed by the relatively niche demand behind medical travel compared to regular holiday and business travellers, who still generate the majority of travel revenues for the operators. The rise in outbound medical tourism from Canada also opens up further opportunities in receiving countries to expand facilities and services for incoming travellers. Popular destinations for Canadians traveling for treatment like Mexico, Thailand and Israel are in fact all expected to see significant value growth in medical tourism over 2013-2018, in part supported by Canadian travellers.
On the other hand, the future of international patients at Canadian facilities faces strong objections by some Canadians, who fear the loss of the public system and competition for medical attention. While current forecasts for medical tourism in Canada anticipate solid growth ahead, at a 17% CAGR in US dollar constant value terms over 2013-2018, recent concerns and government reviews of the existing and pilot programmes might slow down the progress. More studies and proof of reduction in costs for publically funded medical care through additional revenues brought in by foreign patients, without impacting on waiting times, would go a long way to boosting support for and further expansion of inbound medical tourism in Canada.