Medical Tourism in Developing Countries

Promoting Medical Tourism ● 97thus keeping costs lower than they would be if these inputs had to beimported (also discussed below).The benefits of keeping production costs down are obvious. For theinternational patient, low production costs translate into savings that canbe passed on to the consumer in the form of lower prices. In addition tolow prices, international patients also benefit with respect to the quantityof attention they receive. When costs of providing medical services are low,destination hospitals can hire more nurses and support staff per physicianthan in the United States, enhancing the patient’s experience. Finally,foreign investors also benefit from low costs of production. They are morelikely to invest where wages are lower and costs associated with litigationand regulations are minimal. 4Price-Reducing Competition between SuppliersAnecdote: The Serbian diaspora in Italy travels to Serbia for vacation andmedical tourism. Plastic surgery and dental work are the most popularservices. Serbian physicians who practice in Rome are competing with doctorsin their home country and as a result, they have begun to reevaluatetheir pricing strategy. To stay competitive among the Serbian diasporapatients, Serbian diaspora physicians in Rome began offering medical treatmentsat the same price patients would pay if they went to Belgrade. Suchprice discrimination between Serbian diaspora patients and Italian patientsis the result of competition that so far only the Serbian market enjoys.A similar pricing strategy is pursued by suppliers of medical tourism aroundthe world, with the aim of maintaining or increasing market share by reducingprices (even if it provokes a response by other doctors, hotels, rental caragencies, etc.).Price-cutting is an integral part of medical tourism since for the mostpart no single country has a monopoly on invasive, diagnostic, and lifestyleservices although, as discussed in chapter 3, countries are trying to highlightdifferences between themselves and other destinations. Similarly, nosingle country has a monopoly on tourist attractions. Many tout an as-yetunexploredangle, trying to create a monopoly by drumming up demand(an entire literature has cropped up on the competitive strategies of touristdestinations 5 ). Despite these efforts, substitution of one destination foranother is common across the globe, highlighting the interchangeability oftourist and medical destinations and underscoring that alternatives areboth available and plentiful. For many tourists, one sunny beach isperceived to be like another, one exotic person like another; for medicaltourists, a porcelain tooth filling is just that—a porcelain tooth filling.