Hospital chains have started to see a revival in medical tourism - a high profit-yielding segment - with the easing of international travel restrictions as the Covid-19 threat seems to be receding.
With the loosening of international travel restrictions as the Covid-19 threat appears to be receding, hospital chains have begun to experience a rebirth in medical tourism, a high-profit-yielding niche.
Max Healthcare reported a 68 percent increase in revenue from overseas medical tourism in the third quarter of the current fiscal year, to 77 crores. According to Max, the revenue was two-thirds of the pre-Covid run rate. Foreign medical tourists used to account for around 10% of overall revenues at large hospital chains in the country before Covid, according to industry insiders.
Medical tourism may take a quarter or two to recover to pre-Covid levels, according to industry executives, partially due to ongoing foreign travel-related limitations.
India, on the other hand, has not imposed any restrictions on medical visas, which are valid for 60 days from the date of admission into the nation.
"By the first quarter of FY23, we hope to be back to pre-Covid levels," said Mihir Vora, founder of Magnus Medi, a Mumbai-based medical value travel company that helps patients choose hospitals, schedule appointments, organize visas, tickets, and lodging.
"Medical travel recovered in the third quarter of FY22, with a brief pause in January due to the Omicron wave, but things are now returning to normal," he stated.
However, the pandemic isn't the only threat facing the industry.
Afghanistan used to account for roughly 20% of medical tourists visiting India. Due to the unpredictability of political and economic realities, few Afghans are seeking treatment.
Medical tourism revenues were modest in Q3FY22, according to Apollo Hospitals, a renowned hospital network with a stronger focus in the South. In a recent earnings call, the business stated, "The medical value of travel has seen an uplift in this quarter versus last quarter...going forward we will have that advantage as well.
While medical travelers make up a smaller percentage of overall revenue, their rewards are very high, according to a senior executive of a prominent hospital group. "Medical travelers generate 50% more revenue per occupied bed (ARPOB) than CGHS (central government health scheme) patients and 20%-30% more revenue per occupied bed (ARPOB) than normal insurance patients... And hospitals will receive upfront payments from these patients, which will boost their cash flow," stated the anonymous source.
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