Medical tourists shun Singapore as healthcare costs soar

Cheaper ASEAN hubs are snatching patients away.

Singapore's medical tourism industry needs a booster shot if it wants to stay on top of the game in the face of intensifying competition from cheaper regional rivals.

A report by BMI Research highlighted that neighboring countries such as Thailand and Malaysia are rolling out aggressive measures to attract a larger share of medical tourists, and Singapore’s expensive hospitals might be unable to catch up as patients flock to these cheaper countries.

“The high cost of medical treatment relative to its regional peers will serve as a financial deterrent for foreign patients, which are further exacerbated by the strength of the Singapore dollar. In addition, government support has remained limited as compared with Thailand and Malaysia, which will see Singapore losing medical tourists to these competing hubs,” BMI Research said. 

Singapore’s vulnerability was starkly revealed by the 25% drop in medical tourism revenue in 2013, from $1.1b in 2012 to just $832m.

Singapore's value proposition to medical tourists will continue to be eroded by the high cost of healthcare treatments relative to in neighbouring markets, the report noted. 

For instance, a heart bypass in the city-state is 41% more expensive compared to Thailand, and a staggering 106% more than Malaysia. 

“This significant pricing premium has traditionally been mitigated by the high levels of healthcare treatment offered, However, this gap in standards has begun to close with private healthcare providers in competing hubs such as Thailand gaining international accreditation,” the report noted. 

Moreover, private hospitals, including Thailand-based Bumrungrad International Hospital, have rapidly expanded into offering specialists services, which was once a key competitive advantage for Singapore.

Apart from this, the strong Singapore dollar--particularly against key regional currencies such as the Indonesian rupiah--will weigh on the prospects for medical tourism in the country. 

“The confluence of these two factors will in turn, create a business environment that will drive private healthcare providers overseas. This is critical as private hospitals are the key drivers of medical tourism in Singapore as public healthcare providers remain constrained over domestic concerns that serving foreign patients will come at the expense of locals," said the report.