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US medical tourism dollars lost to Covid-19


New research from the Center for Medical Tourism Research (CMTR) at the University of the Incarnate Word (UIW) found that Covid-19 travel restrictions cut hospitals’ medical tourism revenue by an estimated $1.9 billion in 2020 and 2021, Alex Kacik reports for Modern Healthcare.

Covid-19 travel restrictions cut medical tourism revenue

Every year, thousands of patients travel to the United States seeking medical care—and many of them pay for costly procedures out-of-pocket.

According to the U.S. International Trade Commission, revenue from international patients traveling to the United States for heart transplants, oncology treatments, and other services increased more than 4% annually between 2015 and 2019. In 2019, the U.S. health system saw over $1.2 billion from medical tourism.

However, new research shows that the pandemic’s travel restrictions cut over $1.9 billion of medical tourism revenue in 2020 and 2021—a loss that had a significant impact on many providers.

“It was such a banner year in 2019 for medical tourism and then of course we had this drop-off because of COVID,” said David Vequist, the author of the research, founder of CMTR, and a management professor at UIW. “For hospitals, medical tourism offers wonderful margins since treatment is almost always paid in cash,” he added.

According to Vequist, medical tourism makes up more than 10% of health systems’ overall net patient revenue during a typical year.

“The pandemic reinforced the vulnerabilityof hospital systems relying heavily on fee-for-service medicine and international travel, and may prompt healthcare providers to adjust their medical tourism strategy,” Kacik writes.

How the decline in medical tourism revenue is impacting providers

While medical tourism revenue saw a significant decline in 2020 and 2021, health system executives have reported that international patient volumes are now at or near pre-pandemic levels.

For instance, the number of inbound international patients treated by Cleveland Clinic dipped by around 50% in the first year of the pandemic, decreasing from 9,150 in 2019 to 4,939 in 2020. In 2021, their volume had already started to rebound, with 7,686 patients.

“Obviously, the pandemic didn’t do anyone favors as it pertains to travel and healthcare,” said Curtis Rimmerman, chairman of Cleveland Clinic’s international operations. “We quickly figured out our priority was to take care of domestic COVID patients. But things have settled down and volumes have rebounded significantly in Florida and Northeast Ohio with the reopening of air travel.”

To draw more overseas patients, health systems have increased their marketing budgets that target prospective international patients. For example, Sanford Health recently partnered with the Manitoba government in Winnipeg, Canada to help address a backlog of neurosurgery patients, said Luis Garcia, president of Sanford’s clinic division.

“For us, it is a great opportunity to help out with the backlog that the Canadian government has for certain services,” Garcia said. 

Still, the costs associated with international marketing and the complex nature of maintaining foreign consumers rose significantly during the pandemic, pushing some providers to develop better telehealth strategies to reach more international patients, according to a 2021 peer-reviewed paper from Rush Health researchers and medical tourism consultants.

However, international restrictions may also place limitations on telehealth. “In response to these challenges, academic medical centers will re‐examine their foreign market strategies and those with significant investments in offshore locations will hedge their bets by lowering their exposure in those foreign operations and locations,” the study said. 

Meanwhile, executives with Cleveland Clinic and Sanford said they don’t intend to slow their international expansion plans or marketing initiatives, particularly as some countries face years-long surgery backlogs for millions of patients.

“We’re anticipating an increase over the next five years of international patient volumes,” Rimmerman said. “Our goals from the international perspective are robust.” (Kacik, Modern Healthcare, 8/17; Campbell, The Guardian, 8/3)





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