The Challenges and the Issue of Medical Tourism in Iran
Table of contents
Traveling overseas to receive health care services is becoming more and more common these days especially for people residing in countries that are developing. For this social group, the consumption of health care services overseas is part of a general pattern of consumption of foreign goods and services, which can neither be found nor are deemed of lower quality in their home countries. In recent times, the privilege of traveling to another country for health care services has become accessible to the middle classes. Destination countries are not only necessarily developed countries, but also developing countries that have positioned themselves to take advantage of this new market. In addition, a fairly new phenomenon may be observed, that is, people traveling from developed countries to developing countries to seek medical care
In Medical tourism is where “tourists” mainly seek medical treatment abroad and are encouraged to experience tourism activities. In the past decades, several Asian countries have been dominating this industry however, a lot of other countries specifically in the middle east region are looking to enter the market and to grow their Medical tourism industry and market. One of the many countries looking to enter, grow and expand exponentially in this segment is Iran.
Throughout the years, the Iranian government have paid close attention to the country’s medical sector and have therefore supported the field of medicine by equipping hospitals with state of the art medical equipment through an extensive grid of highly-equipped hospitals. There are 850 hospitals, and rehabilitation centers at reasonable costs. A breakdown of costs of the numerous procedures shows that treatment costs in Iran are a lot lower as compared to developed countries. Iran is highly cost competitive as compared to its regional competitors which include Jordan, Turkey, UAE, Saudi Arabia, and Bahrain as well as a few southeast Asian countries like Thailand, Singapore, Malaysia, Philippines, and India.
The distinct mix of experience, facilities and natural resources is the answer to the success of the Iranian health care system. furthermore, Iran also possesses a unique range of experienced medical staff. Medical specialists in the country are extremely qualified professionals whom are supported by trained paramedics and equipped with advanced medical equipment. Nurses in Iran is also extremely qualified. In addition, the Iranian health care system is continually supported by wide-ranging medical research.
Iran has a unique mixture of healthy and pleasant climate, delightful scenery, glorious historical and cultural monuments as well as advanced technology and refined medical equipment.
Today, medical tourism in Iran is a developing industry which aims to provide world-class medical facilities by a public-private partnership. Although historical data on medical tourism is inadequate, according to the government, in 2007, there were over 50,000 non-resident patients (S. Sadri, personal communication, November 10, 2008).
Cluster Diamond Analysis
Factor (Input) conditions
Iran has been collecting the numerous factor inputs essential for booming medical tourism cluster. Such factors can be generally classified as: (1) suitable infrastructure, (2) nice environment, people and culture, and (3) government’s key policy.
In terms of human resources, Iran has highly competent medical practitioners. The country now has over 850 hospitals nationwide. Hospitals in Iran use modern technology. However, the use of modern medical technology, especially high-tech medical equipment, is common primarily in big cities and private hospitals. Public hospitals do not get involved in medical tourism. In terms of international airports, additional investment is needed to improve the quality of infrastructure.
Environment, people and culture
Iran has a healthy and pleasant climate, wonderful scenery, and unrivalled historical and cultural monuments. The country is rich in natural resources of spas and hot springs in different cities. This is accompanied by internationally recognized warm hospitality of the Iranian people.
Government’s key policy
The Iranian government campaigns to develop its health care system as a medical treatment center in the region. However, there are limitations, including: administrative “red tape” in issuing practicing licenses, very inadequate malpractice insurance and a lack of proficiency in English or other languages in the country.
There are three key bases of demand for medical tourism in Iran: (1) Iran has to provide similar quality of health care for Muslim countries in the region as a medical hub, (2) Iran has sturdy demand for cosmetic surgical procedures, and (3) Iran has been enjoying a good reputation as a major medical destination for several countries in the region.
Related and supporting industries
Iran has 51 medical schools and over 3000 doctors are trained annually.
Context for firm strategy and rivalry
There is strong competition amongst domestic and international medical and tourism providers. In south-east Asia, Singapore, India, and Thailand are three major competitors as well as Turkey, UAE, Saudi Arabia, and Jordan in the region. If Iran’s position is limited to a pure cost advantages without any unique strength or value added, these countries, especially Turkey and UAE, will seize Iran’s market share in the future.
Can the medical tourism cluster have sustainable growth? It depends on the medical resources that different nations have available. If Iran fails to meet the demand of its population for quality health care services, the country will face serious social and political challenges. Its citizens will question why the best doctors, the best medical devices, and the best services are at the service of foreigners instead of the Iranian citizens.
Little attention is paid by the hospitals to the medical tourism cluster. At the moment, almost all hospitals handle medical tourism requests. In fact they lack a dedicated division to handle their medical tourism business. Not having a committed contact person to coordinate activities and an executive to make pricing decisions on medical costs makes it difficult for a potential patient, who does not speak Farsi and lives in a different country, to establish contact and make follow up inquiries. The lengthy processes to respond to inquiries, a lack of transparency of the services to the patients, difficulty in communication and inefficient processing of administrative tasks are problems stifling the growth of this cluster.
Insurance package issue
Medical services carry high risks, as they may impact human life and well-being. When this service is provided by a foreign practitioner in a foreign country, usually the perceived risk is even greater. This is one concern that could negatively impact the growth of medical tourism, because there are no sophisticated cross-county insurance packages available, which could protect the interests of both patients and doctors.
Iran still enjoys the benefit of being the first mover in medical tourism in the region with strong Factor and Demand Conditions. However, it needs to improve the context for Firm Strategy and Rivalry and also to strengthen the Related and Supporting Industries. The Iranian government has the great vision of being both the medical treatment hub and the tourism capital in the region by achieving 20 million international tourists’ arrival by 2024 (The vision of Iran for 1404). Although, the concept of medical tourism is perfectly aligned with those dreams, the government has not taken an active stance to develop this nascent cluster and integrate it into the two visions. After (The vision of Iran for 1404).
From the perspective of the cluster, there are a few things that should be done to improve the competitiveness of the cluster:
- To enhance the capacity of medical service providers by getting international accreditation and increased affiliation for both hospitals and medical professionals,
- To perform annual benchmarking analysis against other international players,
- To reach out and cooperate with travel agencies, hospitals, and insurance companies more aggressively in its target markets,
- To develop medical tourism IFCs (Institutes for Collaboration) in Iran, and
- To build a follow-up system for post-treatment monitoring and evaluation of patient satisfaction.
From the point of view of the Iranian government, there are also a few steps that need to be taken:
- To encourage and support medical service providers and doctors to get international accreditation and affiliations, not only to promote its brand internationally, but also to enhance transparency and win customers’ trust,
- To promote Iran as the leader in the region in medical tourism more aggressively, and to improve Iran’s image as a clean, healthy and safe travel destination,
- To play a leading role in developing medical tourism IFCs to allow cooperation and coordination between the public and private sector,
- To collect and set up a thorough database to monitor the progress of the cluster and improve its transparency and creditability, and
- To establish a special insurance system for medical tourism, with a special focus on malpractice. If the Iranian government can negotiate for a cross-border insurance package with the patients’ home countries, this would increase Iran’s credibility as a medical tourism destination.
Finally, the study found that medical tourism in Iran is a rapidly growing cluster with governmental support. However, it is still lagging behind regional rivals such as Jordan and Turkey. To tap into its growth potential, by especially attracting valued customers from rich countries, the government needs to improve its business environment and infrastructure and provide an enabling political, legal and social environment. Dynamic efforts must correspondingly be made to reassure the link among the health care industry, the tourism sector, and supporting industries such as telecommunications and advertising in terms of packaging products, coordinating marketing and upgrading of the cluster.
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