A cure beyond borders: Looking to consolidate offerings in medical tourism

Universal health care is taking on a new meaning in Colombia. Not only are citizens keen to gain more access and higher quality services, foreigners too have come to recognise the benefits of seeking out treatment in cities like Bogotá and Medellín. Authorities have caught on to the trend, integrating this segment into the government’s Productive Transformation Programme ( Programa de Transformación Productiva, PTP), one of the country’s most aggressive and successful initiatives to increase sector competitiveness. According to PTP figures, foreigners who arrived in Colombia solely for medical treatment made up 1.8% of all tourists in 2012, up from 1.18% the previous year. Export earnings related to health tourism are even more impressive though, estimated to have risen from $80m in 2011 to $140m in 2012. In general, popular treatments sought out by foreigners include cardiovascular, neurosurgery, traumatology and aesthetic surgery, among others.

IN THE ZONE: While a handful of international awards and recognition have placed Colombia’s health system on the global radar, special tax regimes are allowing medical clusters to flourish. The sector is also working to conform to international standards, such as those of the Joint Commission International. The country currently has nine health free zones where hospitals, clinics, research centres and pharmaceuticals companies pay income tax of 15%, as opposed to the current standard rate of 25% imposed on commercial activities. While a 2012 reform to the tax structure does not affect existing infrastructure within free zones, it does impose an equity tax of 9% on income of establishments built from 2013 onwards. This new corporate income tax, known as the Equality Tax (or CREE) took effect on January 1, 2013 and should be reduced to 8% by 2015.

Medellín is one of the more popular cities for health services, largely due to its cluster of medical facilities. Operating under the brand Medellín Health City (MHC), the cluster is comprised of 14 health providers, eight dental centres, and the renowned Universidad CES medical school. According to MHC figures, altogether the infrastructure provides more than 2300 beds, 88 operating rooms and 1035 medical specialists who attend to some 73,000 patients per year. In the cluster’s five-year plan up to 2014, investments are estimated to reach $480m, directed primarily at adding 920 beds, 59 operating rooms and 11 consulting offices.

TAKING FLIGHT: The potential behind medical tourism is literally headed for the skies. During the last four years, Medellín-based Aerosanidad has been providing health treatment to travellers on planes and in airports, as well as working directly with patients en route to MHC. For Aerosanidad general manager Juan Carlos López, this in-flight attention adds a competitive element to Colombia’s portfolio of medical services and has great potential given the current health crisis in the US, where rising costs and poor coverage are driving patients to consider alternatives abroad. Indeed, North Americans are becoming the main market for Colombia’s medical tourism industry, accounting for 40% of foreign patients, according to PTP figures. MHC cites the average medical costs in Medellín as less than half of what patients pay for the same services in the US. Other key markets include Canada and Curacao, sending from 40 to 50 patients per month to MHC’s Clínica SOMA, a private health provider specialising in transplants and oncology. Aviation authorities, the police and the PTP have even developed a protocol to expedite the admission of foreign patients arriving for medical treatment.

However, Colombia currently lacks the presence of international insurers to form direct links between foreign patients and available services. This is seen as a key business opportunity and requires establishing relations with US insurers to gain the confidence of health travellers and linking foreign patients to services in Colombia. Nonetheless, the MHC has already formed an alliance with both Jackson Memorial Hospital in Miami and Pittsburgh Hospital, and the combination of preferential tax regimes, government support, high quality service and low prices suggests that Colombia will see a growing number of foreign patients ahead.