CAIXINMEDIA

China's Booming 'Medical Tourism' Business

Traffic is decidely outbound in a country whose medical practices and facilities can't keep up with a multiplying affluent class. Still, there may be positive effects for all in the long run.

London's Wellington Hospital, famous in China after Olympic star Liu Xiang's stay there.
London's Wellington Hospital, famous in China after Olympic star Liu Xiang's stay there.
Li Yen

BEIJING — Following the frenzy of studying and sightseeing abroad, as well as outright emigration, one more activity is in these days — going overseas for health care.

Five years ago, 57-year-old old Mou says he was "sentenced to death" when he was diagnosed with colorectal cancer. When doctors in China told him he wouldn't survive for more than two years, Mou decided to go to the United States for treatment. He is now entering his sixth "survival year."

Earlier this year, Mou's daughter was diagnosed with breast cancer. She also decided to go to America not only to increase her chances of being cured, but to take advantage of health care that is centered around the well-being of the patient.

Going to Japan for "high-precision" check-ups, to America for cancer treatment, to the UK for liver transplants, to South Korea for cosmetic surgery, and to Switzerland for placenta injections have become the newest options for China's affluent class.

For middle-class Chinese, instead, it is Thailand, India, Singapore, Malaysia and Philippines that are the top destinations thanks to their good care at more affordable prices.

This so-called "medical tourism" is a worldwide phenomenon. According to a survey released by the Stanford Research Institute, the number of people traveling to other countries for medical treatment has doubled to 40 million since 2006. In 2013, the total spent on such practices is $438.6 billion, accounting for about 14% of the world's overall tourism industry.

Though there is no exact number as to how many Chinese people go overseas for healthcare, quite a number of foreign medical institutes are opening up Chinese languages services to serve the growing number of Chinese patients.

Both Dr. Gilbert H. Mudge, Jr., the President and CEO of the U.S. Public Health Services, and Melissa Goodwin, in charge of Global Referral Relations at the Mayo Clinic, confirmed to this newspaper that in recent years the number of Chinese patients looking for overseas healthcare has grown exponentially. The huge potential of the Chinese market is becoming the developmental focus of many foreign medical care institutes.

Start with the stars

It all began to multiply with celebrities and the rich and powerful. In 2012, Liu Xiang, a 110 meter hurdler and Olympic Gold medalist, withdrew from the London Olympics and went to London's Wellington Hospital, the largest private hospital in Europe, for his injury. Yao Ming, the Chinese NBA star has made many trips to America's Memorial Hermann for surgery. Meanwhile, Chinese entrepreneurs such as Feng Lun and Pan Shiyi have paid visits to the Mayo Clinic, which famously treated former U.S. Presidents Gerald Ford, Ronald Reagan and George H. W. Bush.

According to the 2013 Hurun Wealth Report, the Chinese mainland accounts for just over one million millionaires (those whose assets are more than 10 million RMB, i.e. $1.6 million) and more than 60,000 people whose assets are over 100 million RMB ($16 million).

"These people have strong spending power and are particularly attentive to their health, so a lot of them choose to go overseas for their healthcare," said Mou, who is among this demographic. "And this not just for serious illnesses, but also for chronic diseases, rehabilitation therapy, nutrition and wellness, as well as other basic health tests."

As Cai Qiang, the founder and chairman of Saint Lucia Consulting, a Beijing healthcare consultation services company pointed out, "We have nearly 1,000 customers, and more than 80% are affluent businessmen in their 50s or 60s."

Foreign medical treatment costs aren't actually as astronomical as many might have imagined. "The U.S. is relatively more costly, but places such as the UK, Germany and Singapore are only about 10-30% higher than China," says Cai Qiang.

The Chinese citizens who choose to go abroad for medical care are mainly cancer patients, perhaps as many as 80%, followed by those seeking cardiac or neurological treatments.

In Cai's opinion, in comparison to China's healthcare, foreign hospitals' diagnoses are more accurate and treatments are more complete, comprehensive and personalized. Still, for actual practice, China's medical level is fairly good. "So, many patients choose to go abroad for examination, diagnosis and to obtain a treatment program before coming home for its implementation in Chinese hospitals," Cai explains. "This is the most economical and optimal choice."

As for where to go, our investigation shows that patients with serious illnesses and deep pockets mostly go to countries such as the U.S., UK or Germany, whereas people with less severe diseases and more modest economic means will go to South Korea, India or Singapore. "Considering medical standards, facilities and treatments, America is indeed the best choice. But it is also the most costly," Cai says. "In contrast, Britain is more cost-effective, the quality is good while the cost is half of that of the U.S. Meanwhile, in Asia, Japan also offers pretty good medical care. The problem is that it’s very hard to get a healthcare visa for that country."

Where the differences are

Ultimately, survival rate is the statistic that matters most. In 2012, the American Cancer Society and the National Cancer Institute issued a joint report stating that, thanks to improved survival rates, by 2020 America’s cancer survivors will increase from the current 1.37 million to 1.8 million.

Meanwhile, as the 2013 Chinese Cancer Registration Center’s Annual Report showed, China has 3.5 million new cancer cases per year with a death rate of 2.5 million. Whereas the developed countries’ cancer cure rate has reached 65%, it is only about 25% in China.

But the greatest difference lies in the diagnoses and the treatment plan. According to Melissa Goodwin, in the Mayo Clinic a patient-centered team of experts is formed. For example, a lung cancer patient’s treatment team would comprise of internal and pulmonary physicians, lung cancer doctors, an oncologist, radiotherapy doctors, as well as social workers. "Each person has his field of expertise and opinions. Finally in synthesizing all views, the diagnostic result and treatment are defined. This result has to be endorsed by everyone."

In contrast, in Chinese hospitals’ the various departments are relatively independent. Mou still recalls going back and forth between different departments and struggling to make his own decisions after listening to the various bursts of medical jargon, and waiting on long lines for the privileged to speak for less than ten minutes with the doctor.

Catfish effect

Other factors pushing affluent Chinese patients overseas include China’s shortage of the most advanced and sophisticated medical instruments, as well as cost-effective anti-cancer drugs.

The rapid increase of Chinese patients has aroused a number of American medical institutions' attention. Free translation services and Chinese websites are now some of these top hospitals' standard facilities.

The Mayo Clinic's Chinese patients doubled from 2012 to 2013 and is expected to triple by the end of this year. Gilbert H. Mudge, Jr. of Public Health Services confirmed that PHS will establish hospitals in Beijing and Shanghai, and launch additional cooperation projects in places including Shenzhen and Urumqi.

There are also a growing number of consultancy operations and travel agencies that offer such services as translation, accommodation, paperwork, and tours. High-end customized trips for the super-rich or the affluent combining sightseeing and physical examinations or wellness therapy stays are springing up.

The positive flip-side to this is that China is finally encouraging private capital to go towards the building of hospitals, and gradually lifting restrictions on foreign direct investment for setting up healthcare institutes around the country. The rise of overseas healthcare travel, it seems, is having a so-called catfish effect back home on China's medical system.

"In a sense," says Marco Huesch, Assistant Professor at Fuqua School of Business, "the globalization of medical services will push each country to reflect on its own healthcare system and make it better."

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Green

In Argentina, A Visit To World's Highest Solar Energy Park

With loans and solar panels from China, the massive solar park has been opened a year and is already powering the surrounding areas. Now the Chinese supplier is pushing for an expansion.

960,000 solar panels have been installed at the Cauchari park

Silvia Naishtat

CAUCHARI — Driving across the border with Chile into the northwest Argentine department of Susques, you may spot what looks like a black mass in the distance. Arriving at a 4,000-meter altitude in the municipality of Cauchari, what comes into view instead is an assembly of 960,000 solar panels. It is the world's highest photovoltaic (PV) park, which is also the second biggest solar energy facility in Latin America, after Mexico's Aguascalientes plant.

Spread over 800 hectares in an arid landscape, the Cauchari park has been operating for a year, and has so far turned sunshine into 315 megawatts of electricity, enough to power the local provincial capital of Jujuy through the national grid.


It has also generated some $50 million for the province, which Governor Gerardo Morales has allocated to building 239 schools.

Abundant sunshine, low temperatures

The physicist Martín Albornoz says Cauchari, which means "link to the sun," is exposed to the best solar radiation anywhere. The area has 260 days of sunshine, with no smog and relatively low temperatures, which helps keep the panels in optimal conditions.

Its construction began with a loan of more than $331 million from China's Eximbank, which allowed the purchase of panels made in Shanghai. They arrived in Buenos Aires in 2,500 containers and were later trucked a considerable distance to the site in Cauchari . This was a titanic project that required 1,200 builders and 10-ton cranes, but will save some 780,000 tons of CO2 emissions a year.

It is now run by 60 technicians. Its panels, with a 25-year guarantee, follow the sun's path and are cleaned twice a year. The plant is expected to have a service life of 40 years. Its choice of location was based on power lines traced in the 1990s to export power to Chile, now fed by the park.

Chinese engineers working in an office at the Cauchari park

Xinhua/ZUMA

Chinese want to expand

The plant belongs to the public-sector firm Jemse (Jujuy Energía y Minería), created in 2011 by the province's then governor Eduardo Fellner. Jemse's president, Felipe Albornoz, says that once Chinese credits are repaid in 20 years, Cauchari will earn the province $600 million.

The Argentine Energy ministry must now decide on the park's proposed expansion. The Chinese would pay in $200 million, which will help install 400,000 additional panels and generate enough power for the entire province of Jujuy.

The park's CEO, Guillermo Hoerth, observes that state policies are key to turning Jujuy into a green province. "We must change the production model. The world is rapidly cutting fossil fuel emissions. This is a great opportunity," Hoerth says.

The province's energy chief, Mario Pizarro, says in turn that Susques and three other provincial districts are already self-sufficient with clean energy, and three other districts would soon follow.

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