Playing catch-up

Acombination of "desperation and internet research" brought the Zazalak family to China in April of last year. Their four-year-old daughter Tatyanna had been diagnosed with Batten disease, a rare and fatal neurological disorder, and the prognosis from doctors in their native Canada was grim.

"We were told to take her home and enjoy her for the small amount of good time she had left. That wasn’t good enough for us," Tatyanna’s mother, Janelle, said.

When the Zazalaks spoke to CHINA ECONOMIC REVIEW in May, they were near the end of their second visit to Beijing Tiantan Huapu Hospital, a private hospital specializing in stem cell treatments for neurological diseases. Treatment had not only halted the progression of Tatyanna’s disease, but even reduced some of its symptoms.

Stem cell treatments lie beyond what is typically considered mainstream medicine. Nonetheless, some expect that China could emerge as a destination for families like the Zazalaks, and others seeking more conventional treatments.

Finding a niche
Hou Shengtian, vice professor at the management department of the School of Chinese Pharmacy, said that while most Chinese hospitals at present are unable cater to medical tourists, increased competition due to China’s health care reform may lead providers to look abroad.

"A hospital will try to be different from other ones and find a niche market to make some profits. Medical tourism will be a good option," he said.

The prospect of a thriving medical tourism industry is tantalizing. China must contend, however, with established Asian rivals such as Singapore and Thailand, and up-and-comers in India and South Korea. Success may require the country to diverge from the well-trodden path of its regional and global competitors.

Although he accepts the shift will not be easy, Ruben Toral, president of the International Medical Travel Association (IMTA), sees no reason why China’s modernization in other industries cannot be replicated in health care.

Estimates on the global medical tourism industry vary wildly, due in large part to differences in the definition of a medical traveler. A report published last year by Deloitte said the industry was worth US$60 billion and will grow to US$110 billion by 2010. Deloitte estimates that there were 500,000 medical tourists from the US alone in 2005. However, another 2008 report, published by McKinsey & Company, put the number of inpatient medical tourists worldwide at 60-85,000.

Hou estimates that the value of China’s medical tourism currently stands at US$146.6 million and will grow to US$1.5 billion in the next three to five years. Industry watchers say that there are no reliable figures on the number of medical tourists visiting China.

China currently lacks key components necessary for developing a viable medical tourism industry. Medical travelers, though enticed by discounts of up to 50-70% for certain procedures, demand hospitals with advanced equipment and Western-trained doctors. Language skills, primarily English, are also critical.

And while Chinese doctors may be well-practiced in hip replacements and heart surgeries, China has a marketing problem: It has nothing to compare to the iconic assets, like Thailand’s Bumrungrad International Hospital, that form the core of major medical tourism centers.

Paul Chang, the Singapore-based Asia-Pacific managing director for the Joint Commission International (JCI), which certifies health care facilities globally, said that hospitals in Singapore and Thailand enjoy strong government support and have a deep roster of Western-trained doctors, as well as translators specializing in medical vocabulary. Some facilities even accept Western health insurance.

"[These hospitals] are well organized and well set up to cater to foreign patients, something that I don’t think you find very often in Chinese hospitals," he said.

There are anecdotal signs that Chinese hospitals are changing. The JCI has already accredited four Chinese hospitals, and expects more in the next several years. Tiantan Huapu provides families with a coordinator to assist with translation and transition to China, and the Zazalaks found their access to doctors superior to what they experienced in Canada.

An unfamiliar approach
Nonetheless, some procedures initially caused concern for Janelle Zazalak, a former nursing student. On the first day of her daughter’s treatment, a nurse appeared with an IV drip, drew a line across the glass IV bottle with a marker and instructed the family to administer half of the dose.  

"It took me quite a while to adjust to the fact that while the daily mechanics of her treatment seemed slightly archaic, it was still safe and acceptable," she said.

Given the deep experience in treatment and service in other medical tourism hotspots, it is unclear how China can establish a presence.

Some suggest that the country may emerge as a leader in stem cell treatments, largely unencumbered by the political obstacles found in the West. But even here, leadership is not guaranteed. Beijing is drafting new regulations on stem cell treatments and research, and the sector was closed to foreign investment in 2007, removing a potential source of funding.

The Ministry of Science and Technology has allocated US$29.2 million to stem cell research from 2006 to 2011; other estimates say Beijing will spend close to US$300 million in that time frame. Still, this pales in comparison to the US$3 billion that California alone pledged in 2004 for stem cell research.

Zhang Fa-bao, president of consultancy Shanghai BIOON, said China’s loose stem cell policy could boost medical tourism in the short term, but said the long-term outlook may be "even a bit negative."

Rather than pursue estoteric treatments, China may be able to differentiate itself by playing to its strengths. With rising global interest in alternative treatments, the country could leverage its expertise traditional Chinese medicine.

"China corners the market in traditional Chinese medicine … so it would seem logical and natural that China would be best-positioned to meld Eastern and Western medicine to form something quite unique," the IMTA’s Toral said.