Governance in separate domains of trade and health

ResultsMedical tourism straddles the policy domains of trade and health. Its rise is situated within the rapid growth of trade in health services, driven by increased international mobility of service providers and patients, advances in information technologies and communications, and an expanding private health sector [ 10 ]. Trade by definition is international, but health systems (financing, delivery and regulation) remain nationally bounded. Additionally, trade objectives of increased liberalisation, less government intervention and economic growth generally do not emphasize equity, whereas health sector objectives like universal coverage do. Consequently, actors in the trade and health policy spheres tend to have conflicting objectives, and trade and health governance processes remain relatively separate at three levels; the international (World Trade Organisation (WTO) and World Health Organisation (WHO)), regional (Association of South East Asian Nations (ASEAN)) and national (government ministries). Reconciling the aims of economic growth with equitable health service provision and access makes governance of medical tourism within a country’s health system challenging at best and contradictory at worst.

At the international level, there are clear tensions between the goals of protecting and promoting health and generating wealth through trade [ 23 ]. Trade and health policy negotiations occur in isolation, despite the growing importance of the trade and health nexus at the global level, e. g. extensive health worker migration and cross border consumption of health services (medical tourism) [ 10. 23 ]. WTO membership requires adherence to a multitude of legally binding obligations, including removal of tariff and non tariffs barriers on goods and services. The WTO’s formal governance architecture is embodied in its legally binding trade agreements and compulsory legal dispute mechanism. These legal apparatus afford it more compliance clout than the WHO, which by contrast is an advocacy organization. The WHO imposes no legal obligations on members, relies on non binding agreements, and has no compulsory dispute mechanism. Thus enforcement capacity in cases of non compliance to WHO agreements is limited [ 23 ]. Economic growth and trade considerations are likely to surpass health objectives at the global level when countries face sanctions or legally punitive measures for non compliance with trade agreements. Examples of trade and health policy incoherence include patents on essential medicines and tobacco promotion in developing countries, permitted by trade agreements [ 37 ].

Whilst most trade in health services takes place outside the framework of existing trade agreements, whether bilateral or multilateral [ 25 ], trade in health services including medical tourism is officially provisioned for under the General Agreement on Trade in Services (GATS). The four modes of supply include; 1. The cross border supply of services (remote service provision, e. g. telemedicine, diagnostics, medical transcriptions), 2. Consumption of services abroad (medical tourism, medical and nursing education for overseas students) 3. Foreign direct investment (e. g. foreign ownership of health facilities) and 4. Movement of health professionals [ 7 ]. Countries can choose to make GATs commitments (which legally bind them to open markets under the auspices and protection of the WTO) sectorally or via a specific mode. In ASEAN, only Cambodia, Malaysia and Vietnam have made GATs commitments relevant to the health sector [ 38 ]. Medical tourism is becoming bureaucratized, formalized and normalized [ 17 ] evidenced by GATs provisions for the health sector. In the context of increasing cross border trade in health services, governments have the option to either schedule GATs commitments in health or continue to trade outside of formal agreements. With rapidly changing domestic and international health markets, the latter looks likely, but it is worth noting that GATS commitments can also limit the degree to which foreign providers can operate in the market [ 39 ]. In policy terms, this clause can protect health systems from monopolization by foreign investors in the health sector.

Regionally, trade also tends to trump health in terms of policy action. ASEAN is primarily a trade forum, and the 1995 ASEAN Framework on Agreement on Trade in Services (AFAS) makes provisions for services liberalisation between members beyond the WTO GATs. Unlike the WTO, ASEAN has no legal authority to enforce compliance, but a dispute settlement mechanism was recently signed. Whilst the health sector is not covered under the AFAS, it is envisioned that the free flow of all goods, services, investments, capital and skilled labour will be achieved to create an ASEAN Economic Community (AEC) by 2020 [ 40. 41 ]. The ASEAN Economic Community (AEC) council meets bi annually to work towards deepening and broadening regional economic integration. In contrast, the ASEAN Health Minister’s Meeting (AHMM) is held every two years. Currently, ASEAN health cooperation is limited to disaster preparedness for natural disasters and infectious disease outbreaks. Agreements in health are limited to sanitary and phytosanitary measures, bar a non legally binding Mutual Recognition Agreement (MRA) on the movement of health professionals. The ASEAN Work Plan on Health Development (2010 – 2015) was finalised in July 2010 to cover broader regional health issues, including non communicable diseases, maternal and child health and primary health care [ 42. 43 ]. Despite ASEAN’s regional economic and health integration, there have been no agreements signed concerning the medical tourism industry. Foreign direct investment by regional players in neighbouring countries is accelerating, with private companies like Singapore’s Parkway Holdings (one of the largest hospital operators in Asia) and the Raffles medical group acquiring hospitals in Singapore, Malaysia, Brunei, India and China [ 26 ]. Malaysia’s state investment company Khazanah’s $2.6 billion bid in Parkway Holdings in 2010 gave it a 95% stake in the company [ 44 ]. Foreign investment by both private and state investment companies implies that significant profits can be made in the health sector of other countries, with profits accruing to shareholders overseas and few benefits for local consumers, unless profits are taxed and reinvested in the destination health system. The substantive economic capacity of these regional players means that health policy aims, like universal access to healthcare, are likely to come secondary to trade policy aims, like increasing foreign investment that can be gained from medical tourism.

Trade and health policy incoherence in promoting both medical tourism and universal coverage for local consumers at the national level is evident. Whilst several studies on medical tourism allude to government’s role in promoting medical tourism [ 8. 16. 21 ], these do not differentiate between the role of different government ministries and their respective policy aims. Trade and tourism ministries are primarily concerned with increasing economic growth and facilitating international trade in the services sector. In contrast, a health ministry’s aim is to improve overall population health and ensure equity in health service access and delivery. Health systems are also nationally bounded; maximising scarce public resources for health within given territorial constraints gives rise to healthcare protectionism by governments, typified by strict eligibility requirements for access to state subsidised services by migrants. Whilst expansionist medical tourism policies had been initiated in trade and tourism ministries of all three countries, there appears to be a spill over effect on ministries of health (MOH). Increasingly, MOH’s are establishing medical tourism committees and departments, dedicated to the promotion of their respective countries’ health facilities to other governments/foreign patients. For example, Thailand’s medical hub policy was initiated in 2003 by the government agency the Thailand Board of Investment, whilst the Ministries of Commerce, Department of Export Promotion and the MOH in collaboration with private hospitals are now the main implementers of the policy [ 15 ]. Whilst Malaysia’s national health plan does not mention medical tourism as a strategic aim [ 45 ], the MOH formed an inter-ministerial committee for the promotion of medical and health tourism (MNCPHT) in 2003 [ 28 ]. Of the three countries, Singapore’s government agencies have the most integrated policy stances that strongly support medical tourism [ 2 ], reflective of the country’s prioritisation of economic growth. Singapore’s Tourism Board, the Ministry of Trade and Industry’s Economic Development Board and the MOH have set a target to attract 1 million foreign patients by 2012 [ 46 ], whilst one of the MOH’s explicit priorities is to “exploit the (country’s) economic value as a regional medical hub” [ 47 ]. In 2004, a multiagency government initiative (including the MOH) SingaporeMedicine was launched with the aim of developing Singapore as a medical hub. Whilst trade and tourism and health ministry objectives are not easily reconciled, medical tourism growth provides an opportunity for inter ministry policy coordination, e. g. via a cross subsidization mechanism whereby medical tourist revenues are taxed, providing extra income for public hospitals. In the three countries, an apparent convergence in trade, tourism and health ministry priorities is taking place, reflective of growing acceptance of health as a private good globally. Improved data collection on medical tourist flows and health systems use and access by local consumers are necessary to assess whether policies that promote medical tourism and universal coverage are reconcilable. Pre-emptively, government ministries should work towards more integrated governance of medical tourism, especially given the highly privatised health system landscape and existing inequities in health systems use and access by local consumers, which could be aggravated by foreign patient inflows.

Delivery in private versus public sector

Medical tourism is driven by the for profit private sector in health systems. The private sector dominates primary care provision in Singapore and Malaysia, but is slowly expanding its role in tertiary hospital care. Private primary care providers are concentrated in urban areas, with public primary care providers catering to those in rural areas, as seen in Thailand and Malaysia [ 14. 48 ]. Hospital services are dominated by the public sector, with a 70 – 80% share of beds (table 3 ) but private hospital providers are steadily growing. In Thailand, private hospital numbers have hovered consistently at 30% of total hospitals between 1994 and 2006 [ 48 ]. In Singapore, private sector hospital growth has risen in proportion with public sector hospital growth between 1998 and 2008 [ 49 ]. Private hospitals are smaller in size and tend to be located in urban areas, serving middle to high income patients as well as foreign patients [ 50 ]. In general, the public private mix of healthcare provision in this region reflects the country’s level of economic development. During economic growth periods, wealthier populations have emerged with demand for private providers in response to perceived lower quality public provision. Consequently the public sector has become more pro poor as this group cannot afford private care, leading to the development of a two tier healthcare system seen in Thailand and Malaysia [ 14. 51 ]. Public services are generally perceived to be of low quality or unresponsive in this region by local consumers [5052]. The steady growth of private sector hospitals has mirrored the increase in medical tourism (tables 2 and 3 ).

Table 3

Public versus private health provision [ 49. 53 – 55 ]

Thailand in a snapshot

Why Health Tourism in Thailand?

Thailand has earned its reputation as one of the top destinations for medical tourists. People choose Thailand for its wide range of treatments and procedures available, low-cost prices, eminent medical staff and top notch doctors. Plus, Thailand is known for its flawless healthcare system and the newest facilities.


Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s