October 25, 2006

Why the old and the sick are dying to get out of here . . .

Posted in Ireland ·
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What do Bray and the health service have in common? Not a lot you might say at first glance. One is an old tourist town – a seaside resort in the classic mode – which lost its main business over the years as the tourist market turned to Benidorm.

The other is a State-run service which despite problems is, in fact, getting better. As we get older it should have more business and unlike Bray, you might think, the heyday of the health service is yet to come.

Well you’d be wrong. The history of Bray casts light on the likely future of the health service.

Bray is a victim of the first phase of globalisation. In the 1940s, 50s and 60s the Bray seafront was jammed with holidaymakers all summer. The boarding houses were packed, as were the down-at-heel hotels, B&Bs and amusements. Property prices along the seafront, held their value in a falling national market. By the mid 1960s Bray was as prosperous as it had ever been.

While there had been some talk of people going abroad on holidays, it was only the rich and they had rarely made the pilgrimage to North Wicklow. No one expected lower airfares. No one expected JWT with their package holidays, cut price deals and the mania for the Costa which engulfed this country in the brief boom of the early to mid 1970s.

People turned their backs on the delights of Bray, preferring to be treated for second degree burns in Fuengerola instead.

Bray, like the traditional British resorts before it, slumped. Many of the grand Victorian houses on the seafront were boarded up in the 1980s and the place had the feel of a ghost town during the week, a war zone on the weekend.

Now think about the health service and globalisation. According to conventional wisdom, the only area that will not be impacted negatively by the rise of India and China will be in personal face-to-face services. Big picture scholars have argued that, while jobs that can be outsourced such as computer programming, will eventually move to India, other jobs that depend on personal services will survive.

They argue that the manufacturing industry in Ireland is on a terminal decline but that our service industry should be ok. Specifically, the mainstream view is that services like those of a waiter or your local GP giving you an annual check up or a guard on the beat, are jobs that cannot be done over the internet or down a high speed modem. As a result, these positions are not only secure in a globalised world but will flourish.

Well maybe not.

If you open any paper these days you will see the emergence of a new trend – ‘medical tourism’. For half the price of here, you can not only get your teeth done, boobs enlarged and tummy tucked, you can get your stents put in, your heart by-passed and your hip replaced. In the US, there are now complete medical tourist packages where you can get the flights booked, best hotel accommodation reserved, golf break after surgery and business centre needs provided by a one-stop shop.

Medical tourism has spawned a cottage industry of everything from spa treatments to concierges who will collect the patient/tourist from the plane.

At the moment, this may appear to be the preserve of the rich. However, like cheap mass tourism to Spain, prices will fall rapidly. At the moment, Americans are at the vanguard of this movement. Again, this will change.

The consultancy McKinsey believes that in India alone, medical tourism will be worth $2bn (€1.6bn) by 2012. And according to a recent report in the New York Times, one hospital in Bangkok – the Bumrungrad International Hospital – registered 55,000 American patients last year.

Obviously in America, the reason for such tourism is the excessive costs of medicine. However here, the national treatment purchase fund already sends our overspill to foreign hospitals and increasingly, as the health service gets clogged up with an ageing population needing more elective surgery, foreign health tourism will become the norm. This will particularly be the case if private hospitals are not rolled out here quickly.

In the long-term, arguably, it is the new private hospitals which have most to fear from medical tourism. The health service will always be there for emergencies or minor emergencies and chronic conditions like pneumonia and diabetes, while, the real battleground for the wallet of elective patients will be where our new private hospital hope to make hay.

There will be a response from the foreign medical package tour operators. We should expect highly specialised hospitals and clinics to set up in off-shore locations offering state of the art equipment, facilities and staff.

These places will offer convalescence on the Indian Ocean rather than the Sandyford industrial estate and free trips to the Taj Mahal rather than physiotherapy in Loughlinstown.

The medical insurance industry which up to now is not involved in this market will jump at the opportunity to underwrite it. If the State picks up the tab for people having operations on the National Purchase Fund in Crawley, why not explore possibilities in Cape Town?

In the years ahead, we are likely to see a significant increase in medical tourism. It is not only driven by the opportunities presented by the clinics abroad, our State service also has to get used to the idea of choice.

Elsewhere, the level of healthcare and service are infinitely more attractive and the cost can be immeasurably lower. Insurance packages will emerge to cover this specific option. Many people will ask why they should pay for an insurance service which is actually paying the wages of health services clerical staff, when they might pay much less for direct insurance which would cover a specific operation. The era of the sovereign patient is about to dawn – an era where patients know more about their illness and want to choose when and where to have their procedures.

This new revolution is just around the corner: the political battleground will be in repositioning health not simply the redistribution of wealth.

The key difference between this revolution and others that went before it is that the firebrands who will lead this movement will be settled grey golfers, not angry young Turks.