The next big operation: medical travel
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Early in 2010, John Yang was given a Herculean task: to market Shanghai as a preferred destination for foreign patients seeking advanced medical care.
His given target was that by 2012, China should have 200,000 medical tourists each year with an average expenditure of $10,000 per patient per visit. At present, medical tourism is almost non-existent in China.
The founder and chief executive officer of China Medical Tourism and Shanghai Medical Tourism Products & Promotion Platform (SHMTPPP) knows that China has to deal with tough competitors such as India, Thailand, Singapore, South Korea, Malaysia, and the Philippines.
Many of these countries have already reported significant revenue from medical tourism. For example, in 2009, Thailand earned $12 billion, and Singapore registered $1.4 billion.
Many leaders in the sector have been expecting a significant Chinese entry for several years.
But launching China into medical tourism is bedevilled by fundamental problems.
"Foreign patients are interested in coming to China, but they don't know who to get in touch with as there are no readily available numbers or names to contact," said Yang during a phone interview from Shanghai.
Another pressing problem that Yang and his team have to solve is the coordination of business entities that have diverging interests.
"At the beginning, we asked ourselves how to bring all parties - hospitals, travel agents, airlines, trade offices, and even translators - onto the same page as us."
Hence, the establishment of SHMTPPP, intended as a sole point of contact for foreign patients and as a promotional tool for medical tourism to China, specifically Shanghai.
To start the ball rolling, the promotional body has set up offices in Los Angeles (LA) and Jakarta, hoping to lure overseas Chinese to Shanghai for medical purposes. It is estimated that there are 1 million Chinese residing in LA and 2 million in Jakarta.
"The fact that there are 40 million overseas Chinese globally made us realize that we should take full advantage of this window of opportunity," said Yang, who is fluent in English and German, in addition to his mother tongue, Chinese.
SHMTPPP will act as a third-party administrator, organizing from beginning to end a foreign patient's medical, travel, dietary, and transportation needs, including dealing with the paperwork.
"From the moment the patient touches down at the airport, we transport him or her to the hospital or hotel, and organize all the required paperwork for documentation at the medical facility. A personal assistant, fluent in English, will be on 24-hour standby," Yang said.
The top 20 hospitals in Shanghai are partners with SHMTPPP.
They include the multi-specialty 850-bed Shanghai East Hospital, which has partnerships with leading institutions such as the German Heart Institute in Berlin, the University of Maryland Medical Center in the US, and Universit Paris Descartes in France.
The global financial crisis also gave rise to opportunities for medical tourism. "We found that many foreigners are not fully insured. A basic policy doesn't cover much if one has to undergo complicated procedures," Yang said.
The total cost of coronary bypass surgery for a foreign patient in a Chinese hospital is 40 percent cheaper than at medical facilities in the United States.
"In relation, we're also cheaper than Singapore, but slightly higher than India and almost the same as Thailand," said Yang.
Cost is not the only reason that patients will travel to access care. Other reasons include access to advanced technology, better quality and higher levels of service, good food and, for some, sightseeing.
Once medical tourism takes off in China, Yang predicted that it could grow by as much as 100 or 200 percent annually during the initial three years.
On a global scale, the current growth of medical tourism averages 30 percent year-on-year.
