Sinking rupee boon for India’s medical tourism

MUMBAI, India – The falling rupee has put hospitals in a unique situation; while they stand to gain from the boost to medical tourism, cost of importing medical devices has also gone up considerably.

MUMBAI, India – The falling rupee has put hospitals in a unique situation; while they stand to gain from the boost to medical tourism, cost of importing medical devices has also gone up considerably.

Major hospitals in the city are upbeat about the boost the depreciating Indian currency can give to international patient arrivals here. “While it is too early to gauge the overall impact of the falling rupee on international patient arrival yet, the outlook is very positive indeed,” said Rajiv Sharma, chief executive officer of Sterling Hospitals.

The rupee is hovering around 62 to a dollar at the moment. It has witnessed a steep fall (from around Rs 53 to a dollar in February 2013) in the last few months, and experts feel that the Indian currency can depreciate further compared to the US dollar.

Apollo Hospitals, Gandhinagar, which now gets around 5-10 per cent patients from overseas, is eyeing to take that up to 35 per cent of net patient admissions over the next few years. Abhijat Sheth, director, medical services, Apollo Hospitals, Gandhinagar said, “We get around 15 to 20 international patients per month who mainly come for transplant surgeries, cardiac and cancer surgeries. The cost of these surgeries is around ten times more in major western countries.” He further added that while a knee replacement surgery costs around $4,500 (Rs 2.8 lakh) in Ahmedabad, it would cost in the range of $35,000-45,000 overseas (Rs 21.8- 28 lakh). “Ahmedabad has already earned a reputation as preferred knee replacement surgery destination, and on an average, around 5,000-7,000 such surgeries happen in the city per year,” Sheth said.

To take advantage of the situation, some hospitals are planning to set up representative offices in key countries. Sharma said, “Sterling is planning to set up representative offices in key African markets.” The hospital gets patients mainly from countries like Nigeria, Kenya and Uganda apart from the UK.

In comparison, Shalby Hospitals gets majority of patients from African countries and the West Asia. Pankaj Doshi, medical director of Shalby Hospitals said that it now gets around 10-12 per cent of its patients from overseas who mainly opt for joint replacement, cosmetic and cardiac surgeries. It is aiming to grow at a 10-12 per cent rate in terms of international patient admissions.

“Cosmetic surgery is emerging as a favourite amongst international patients, especially because of the huge cost difference. In India, cosmetic and dental surgery is very economic compared to most western countries, almost at one-tenth of the cost,” Doshi explained.

Anup Dhir, senior cosmetic surgeon, Apollo Hospitals said “After the advent of the US Affordable Care Act, popularly known as Obamacare, US insurance companies plan to encourage medical tourism. India is poised to become a major beneficiary, given its cost advantage, which has risen significantly with the recent fall in the rupee’s value. Most of the patients at present are from SAARC countries, Africa and West Asia, but tourism from Europe and the US is also likely to pick up as treatment costs in India are low.India has a market share of 3 per cent in global medical tourism & it is bound to grow.”

Hospitals feel that medical tourism here is getting better with growing global network, increasing insurance linkage, better transport and local amenities. “We have technology and resources at par with most western countries together with talent. The only difference being, they follow an uniform protocol when training their workforce. If we pick up on that front, India can emerge as a major medical tourism destination,” Sheth said.

While the falling rupee has been a boon for attracting more international patients, at the same time, it has also raised the cost of importing medical devices. “For any major hospital, around 40-50 per cent of the capex investment would be on medical devices and supplies that are imported.

There one has seen around 15-20 per cent escalation in costs,” Sharma claimed. He also added that off late, firms that import devices are also holding back giving quotes as they are not sure about the fluctuating rupee-dollar value.

In response to the situation, hospitals are trying to zero in on local manufacturers for certain devices which are also manufactured by Indian firms.

“Indian firms too are making good quality medical devices, like stents etc, and most of them also comply to international standards. Therefore, without compromising on quality, if we can find a local maker who can provide us with similar products, hospitals would increasingly look into it,” said Doshi.

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Linda Hohnholz

Editor in chief for eTurboNews based in the eTN HQ.

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