Access Tourism NZ TOURISM FOR PEOPLE WITH DISABILITIES, SENIORS, AND AGEING BOOMERS IN NEW ZEALAND AND WORLDWIDE

It is estimated that by the end of 2010, more than 400,000 Americans will use treatment abroad for a variety of health needs (Travel Impact Newswire).   Recently, a health traveller blog was launched which includes forums where consumers of Medical Tourism can have their say.  The Health Traveller website hopes to help consumers make informed choices when they are contemplating medical or health treatment abroad.  It points out that – while not yet mainstream – travelling overseas for medical treatment is not new. In ancient Roman times documented cases of people travelling comparatively vast distances to locations of health were not uncommon. What is new is that the major reason Americans are travelling overseas is that the high cost of elective, non-acute medical procedures is making such procedures inaccessible at home in the US. 

The list of medical travel destinations is growing rapidly. In terms of overseas visitor numbers it is difficult to get a good estimate for each country.  While there are currently more than 130 countries that want to offer options for treatment abroad, the locations currently most sought out by U.S. health travellers include such locales as India, Thailand, Mexico, Costa Rica and Singapore.  Certainly, medical tourism is not as well developed in New Zealand as it could be and we are – to our detriment – trailing our tourism rivals in developing this industry (Access Tourism NZ, 16 August 2010). In its broadest sense, many patients often view treatment abroad as an opportunity to address health conditions while seeing the world (The Health Traveller).  For this reason, it is imperative that Access Tourism be developed alongside medical tourism, as has pointed out on this website many times before.

Indian hospital operator Fortis Healthcare has agreed to purchase a 23.9% (US$687 million) stake in Singapore-based Parkway Holdings.  This could lead to a major shakeup in the global health-care industry. So writes Bruce Einhorn in the Bloomberg Business Week.  Medical Tourism, which occurs when a person leaves their own country to seek medical treatment in another country, is a growing trend.  Nearly 150,000 Americans travelled abroad in 2007 for international medical care, and numbers drastically increased throughout 2008 and 2009.  Such treatment could be cosmetic or health related.  In Asia, Singapore has the best reputation for doctors and hospitals, and Parkway is well regarded.  India has for some time now had ambitions to be a major player in the medical tourism market and its hospitals are generally much less expensive than those in Singapore or other medical-tourism destinations such as Thailand or the Philippines. For instance, a hip replacement that costs $43,000 in the U.S. could cost $12,000 in Singapore and just $9,000 in India, writes Einhorn. Single heart bypass surgery, depending on severity, may cost an average of $25,000 to $40,000 in the United States, while an individual travelling to destinations such as India may receive such care for approximately $10,000.   By buying the Parkway stake, Fortis has now positioned itself to become the regional leader in Medical Tourism.  There will be a strong presence in India, where Fortis has 46 hospitals  for the most price-sensitive patients, and a new base in Singapore for higher-end customers aiming for more luxury.

New Zealand is missing out on Medical Tourism as there seems little government resolve in developing this market.  In fact, the most recent Ministry of Tourism figures for medical visits to NZ show that such visits have remained at around 0.01% of our total visitor count for the last seven years.  Our neighbours, Australia, held their first Health and Wellness Tourism conference in September 2009.   At that conference, it was discussed how Health and Wellness tourism is estimated to be worth in excess of US$1 trillion and is one of the fastest-growing drivers in the travel industry.  Ruth Grau, Springboard Vacations USA and Medtral NZ has stated that New Zealand has a potential of 2000 medical tourists a year ( Inside Tourism 742, June 19, 2009), and explains why New Zealand is attractive to medical tourists.   In addition, Dr. Hans Raetz, who is involved in the development of a Southern Cross private hospital in New Zealand tourism hotspot Queenstown says that there is a real possibility for medical tourism at the resort (Travel Memo 24 March 2009).  In fact, the Tourism Industry Association of New Zealand, in its brief to the incoming Minister of Tourism in December 2008, stated that the “wellness market (has) the potential to attract high value visitors and would benefit from target marketing’.  Meanwhile, Medical Tourism “has not been something that has been considered’, according to Associate Minister of Tourism Jonathan Coleman (Inside Tourism 742, June 19, 2009)

A Global Medical Tourism Expo and Congress in Peuerto Vallarta Mexico will look at the trends and opportunities offered by the Medical Tourism in Mexico.  Medical Tourism is the largest growth sector within the area of health services industries.   Attendees will include representatives from Mexico’s Tourism Bureau, state Tourism Bureaus, the Ministry of Tourism, universities, tourism developers, tourism businesses, hospitals, clinics, and medical associations.   Thousands of US, Canadians, and Europeans already travel to Latin America countries searching for cheaper drugs and medical treatments, including  stem cells implants, plastic surgery, heart surgery, dental implants, alternative treatments, and medical and wellness spas.  US citizens alone spent US$20b on medical tourism in 2008, and this is expected to rise to US$79.5b by 2017.  US insurance companies are fostering strategic alliances with out-of-country hospitals because it is cheaper for them to send their clients abroad for treatment than to pay for the same treatment to be done in the US.  The stay of a foreign patient includes on average 1 to 4 weeks for recovery, so that access issues will need to be addressed.

In size and purchasing strength, Baby Boomers – those born between 1946 and 1964 – represent the largest group of consumers. And, according to Margo DeAngelo and Phyllis Schiller, recession or recovery, they’re still spending in the USA. In their article, DeAngelo and Schiller quote some facts about American Boomers from a number of authorities.  These include: 

• 78 million American Boomers have an annual purchasing capacity of US$2 trillion despite the current recession; 
• they comprise a quarter of the population and thus the biggest generational segments;
• 14% are already over 65; over the next ten years, the growth of the 50+ age group will be 22%, compared to the growth of 18-to-49-year-olds, which is going to be 3%; 
• 33% have significant financial assets;
• Americans in their fifties, are less interested in “stuff” and more in experiences.

The influence of Boomers in the market place – including in tourism – is not confined to the USA.  According to Audrey Kauffmann (Vancouver Sun), “from Japan to Germany, senior citizens make up a lucrative and fast-growing opportunity in the tourism industry, with deep pockets, disposable income and free time.”   Older travellers have strong purchasing power, and have become common targets for marketers.  For example, travel companies in Germany and Austria are launching new programs to attract Boomers, and one businessman created a “50plus Badge” to help seniors identify ranked hotels across Austria and Germany that are suitable to older folk.  Amenities at these hotels include wider doors that are wheelchair accessible.

Michael Londregan, a California-based travel agent, who oversees Qantas’s holiday arm in the US and Canada, said at the Australian Tourism Exchange trade fair in Adelaide recently that Baby Boomers were the key market returning to international travel (The Australian).   In fact, Australia has for several years now been aware of the increasing importance of ageing Baby Boomers to the market in many sectors.  For example, demographer Bernard Salt, from business advisory firm KPMG, told the Australian Tourism Export Council (ATEC) symposium there would be a soaring popularity in health-based tourism, from spa treatments to cosmetic surgery, as the wealthy and cashed-up Baby Boomers of the western world reached their 60s, 70s and 80s in the next decade and beyond. ATEC also recognizes that Baby Boomers are the growing international drive market and that they have the time and money to spend exploring destinations that are off the traditional tourist track.  They also recognize that growth in the cruise industry is being “fueled by the ageing of many domestic populations and the relative wealth of retiring Baby Boomers”.

Accor Hotel regional general manager Neil Scanlan told the Cairns Strategic Tourism Forum last week that Tourism North Queensland (TNQ) is missing out on the huge Baby Boomer market because it focuses too much on younger travellers.  According to Travel Weekly, Scanlan told his audience that the people with the funds, the time, and the inclination to travel are more likely to be mature aged, but that little is done to attract them.  In comparison, the younger market is small compared to the millions of Baby Boomers, both in Australia and worldwide.   Meanwhile, a tourism repositioning report prepared for the Queensland Department of Resources, Energy, and Tourism in February 2009 identifies Baby Boomers as one of the best segments for providing good tourism growth and yield for the region.  The report states that

“The world’s population is aging, and an increasing proportion of the Baby Boomers are entering retirement. Time rich, healthy, disposed to spend on travel, and inquisitive, they represent an increasingly important target segment for tourism destinations. In the current economic climate where the younger age segments are under some pressure, their value does increase.  They have the potential to be long stay and repeat customers for a destination which can deliver a range of experiences and lifestyle options conducive with their new priorities in life. The UK and Japanese markets would appear to be prime opportunities for this segment development. The NZ and domestic market also have potential which should be explored.  TNQ needs to consider what modifications of services and product are required to attract this segment,  Their interest in self development and learning is an important consideration in their choice of destinations and holiday options. A destination which can deliver programs to stimulate this segment alongside its natural appeal will have an advantage.  As part of the aging process there is a related interest in, and demand for medical facilities and service.  This includes “soft” health services as well as major surgical.   Medical tourism is a sector which has grown, in recent years, but is not only servicing the older segments but increasingly younger age groups. “

In an effort to increase tourism, island nations such as Barbados and the Philippines are launching initiative to lure older travellers in need of high quality healthcare. The International Medical Travel Journal reports that a  task force for the government of Barbados will create a National Healthcare Quality Council to regulate private product and service providers in six sectors, including universal access to tourism products and services.  The target market is seen as “ An aging population with increasing demands for cosmetic surgery, spas and retirement communities.”  Head of the Barbados Departmetn of Tourism Richard Sealy, has said that health and wellness tourism is growing faster the general tourism and Barbados plans to develop its health and wellness market.  A recent study by the Barbados Hotel and Tourism Association (BHTA) found that Barbados needs to do more to capitalize on this profitable niche market.  Filipino legislators are also working to promote medical travel, a global industry that is expected to be worth $188 billion within the next three years, according to the Manila Bulletin. The Philippines is developing medical tourism under the initiative of the Department of Tourism.  While the Philippines has had medical tourists for three decades, numbers have recently risen from 60,000 foreign patients in 2007 to about 100,000 foreign patients in 2008, bring in about $350 million since the program was launched in 2006.  The Department of Tourism expects the Philippines to have 200,000 foreign patients by 2015, generating $3 billion.  In the central Philippines, there are now 44 hospitals and health facilities accredited for medical tourism by the Department of Health and the Department of Tourism. Three of these medical facilities have been accredited by the Joint Commission International , an international organization providing accreditation for hospitals and other healthcare facilities worldwide.

In its research report “Poland Medical Tourism Market 2013 – An Untapped Opportunity”, IMRS has identified Poland as one of the most promising destination for medical tourism in Europe. In recent years tourists from countries like the UK and Germany have increased visits to hospitals and clinics in Poland for medical consultations and procedures. Driving this increase has been lower treatment costs in Poland and shorter waiting times. Also important has been Poland’s entry into the Europena Union, and,as a European country, it is placed in its market and there are no visa issues for Europeans.   The only challenge for Poland comes from already established medical tourism destination like India, Singapore and Thailand. According to the report, the medical tourism industry in Poland has the potential to grow exponentially because it has government support and an increasing number of private healthcare facilities.  A growth of 15% in medical visits to Poland is expected over the next several years.

Because Europe has an increasingly aging population Bulgarian government and tourism industry officials are looking to spa tourism to drive annual growth.  Spas in Bulgaria are open all year round and new luxurious hotels have already gained a reputation among Bulgarians and foreigners alike for the high quality of their services.  Tourism, which accounts for about eight percent of GDP, remains one of the few sources of foreign revenues for the poorest European Union nation.

Finns Hejari-Hashemi and Jukka Yrjola, who stayed in a five-star hotel in Velingrad — a mountain town that boasts 80 mineral springs — said they were particularly attracted by the warm climate and affordable prices.  ”We are both at the age where we enjoy these kinds of spa services,” Hejari-Hashemi, 54, quipped. “This is my first time here but not the last for sure.”

Medical Tourism is a growing trend.  Nearly 150,000 Americans travelled abroad in 2007 for international medical care, and numbers drastically increased throughout 2008 and 2009. According to the Medical Tourism Association, an estimated 23 million Americans alone will travel overseas for their medical care by the year 2017, with expenditures of nearly $80 billion dollars. Large numbers of Britons, Canadians, and Middle Eastern citizens of countries such as Iran and Iraq, as well as Afrikaans, are seeking international medical destinations.  International medical care has become nearly synonymous with vacation travel to many state-of- the-art, world-class, and famous tourist destinations around the world. Formerly limited traditional medical destinations such as India, Thailand and Singapore have blossomed with growth in the 21st century with newer, high-tech, and world-class facilities located in destinations from the Ukraine, Turkey, and Jordan, to South Africa, the Mediterranean, Switzerland, South America, and new Asian destinations such as South Korea, Japan, and Malaysia.  Baby boomers travelling to international destinations may save tens of thousands of dollars on the same treatments performed in the U.S., Canada and Britain, while it the same time receiving state of the art, high-tech and qualified care. For example, single heart bypass surgery, depending on severity, may cost an average of $25,000 to $40,000 in the United States, while an individual travelling to destinations such as India may receive such care for approximately $10,000. A knee replacement in the United States may cost 35,000 to $40,000 per knee, while knee replacement surgeries and procedures in destinations such as Costa Rica, charge 1/4 to 1/2 same price, all the while providing certified, accredited, experienced, and highly trained surgeons, and high-tech facilities (article here).

Poland, Jordan, and countries in Asia are expecting to profit from an increased growth in medical tourism.   A recent report predicts that medical tourism in Poland will increase by 15% over the next several years as patients from countries like the UK and Germany visit there for medical treatments. Lower treatment costs, no waiting time, and Poland’s entry into the European Union have driven an influx of patients from other countries.

In Jordan, the number of foreigners seeking medical treatment rose by 10% to 220,000 in 2009, generating about  1 billion U.S. dollars in revenues.  “In spite of the global financial crisis, Jordan’s position as a destination for medical treatment was not affected as the number of foreign patients increased in 2009,” Jordan’s Private Hospitals Association President Fawzi Hammouri told reporters at a press conference.

Dr. Sanjiv Malik, chair of the International Summit on Medical Travel, Wellness , and Retirement predicts that international healthcare travel will play a large part in the recovery of Asian economies from the current recession.  According to the Travel Daily News, an industry report reveals that the Asian medical tourism industry will grow by 16% from 2010 to 2012.  “More and more people from the US, UK and Europe have considered travelling to countries like India, Philippines, Thailand, Singapore and Malaysia as a viable option to getting treated in their own country, which usually have long wait times and overburdened healthcare system. The demand for medical and wellness services in Asia is robust and will still continue to rise,” Malik is quoted as saying.

The report goes on to say that the recent passage of the US healthcare reform bill will also positively impact the medical tourism industry. Expanded insurance will now cover 32 million previously uninsured Americans, and more of these people are expected in Asian hospitals and clinics where they can buy medical procedures and treatments at a fraction of the amount that they would have to pay for the same service in the US.

In addition, some Asian, Central, and South American  countries are increasingly seen by seniors and Baby Boomers as places to retire (Retirement Tourism).   Meeting the needs of these groups is seen to be a major economic driver.

An exhibition in Montreal, Canada (1-2 May, 2010) is aimed at pitching to the lucrative Baby Boomer market. The organisers recognize that the segment of the population over the age of 45 is a powerful economic force. “People in this group generate enormous demand for virtually every product and service, and that demand is growing every year. Not content to deprive themselves of anything, these “mature” consumers indulge their desires and have the financial means to satisfy them.”  Statistics Canada reports that people over the age of 45 account for half of Canada’s population. Most notably, those in the 45 to 60 category, the wealthiest generation in Canadian history at the peak of earnings potential, account for nearly one-third of the population. In the Greater Montréal area, this represents well over one million people – a large market with a lot of buying power.

Exhibition categories include Travel and Recreation, Airlines, Hotels, Resorts, Restaurants, Spas, Laser Therapy, Laser Surgery, Plastic Surgery, Tennis & Golf Clubs, Retail Stores, Ballroom Dance Clubs, and Mobile Homes, Designed for affluent consumers over the age of 45, the exhibition is expected to draw 6,000 to 8,000 visitors.  Last year’s exhibition featured about 120 exhibitors.

A new edition of the United Nations Economic and Social Affairs report, World Population Ageing 2009, has been released.  The report provides a description of global trends in population ageing and includes a series of indicators of the ageing process by development regions, major areas, regions and countries.   The contents of the report underscore four major findings:

1. Population ageing is unprecedented, a process without parallel in the history of humanity. At the world level, the number of older persons is expected to exceed the number of children for the first time in 2045. In the more developed regions, where population ageing is far advanced, the number of children dropped below that of older persons in 1998.

2. Population ageing is pervasive since it is affecting nearly all the countries of the world.

3. Population ageing is profound, having major consequences and implications for all facets of human life. In the economic area, population ageing will have an impact on economic growth, savings, investment, consumption, labour markets, pensions, taxation and intergenerational transfers.

4. Population ageing is enduring. Since 1950, the proportion of older persons has been rising steadily, passing from 8 per cent in 1950 to 11 per cent in 2009, and is expected to reach 22 per cent in 2050. As long as old-age mortality continues to decline and fertility remains low, the proportion of older persons will continue to increase.

Other main findings of this report include the following:

• Population ageing is irreversible.
• The population aged 60 years or over was 200 million in 1950, 600 million in 2000, 700 million in 2009.  This figure is expected to reach 2 billion by 2050.
• The pace of population ageing is faster in developing countries than in developed countries.
• The population of older persons is itself ageing. Among those aged 60 years or over, the fastest growing population is that of the oldest-old, that is, those aged 80 years or over.
• Because women live longer than men, women constitute the majority of older persons.

 Although the report does not mention disabilities, other UN reports – for example, the Convention on the Rights of Persons with Disabilities - note that the prevalence of disability increases with age, so any future-planning in tourism should include a consideration of both the ageing population and disability.

An aging population of Baby Boomers and the increasing stress of modern life has created a boom in wellness retreats and spas around the world according to Elisabeth Brehl, managing director at German exhibition organizer EPOC Messe Frankfurt.   Skin Inc magazine reports (February 2010) that the spa trend is expanding and spreading from day spas and spa resorts.  The pursuit for personal wellness has extended to become a lifestyle trend itself, and leisure time is increasingly associated with activities that look to cultivate physical, spiritual and mental well-being. According to Euromonitor, health and wellness tourism globally grew 57% between 2003 and 2008 to reach $65.5 billion.

Boomer consumers are defying the stereotypes of aging – and giving marketers pause to think.  A new study of 1,100 Boomers gives marketers a first glimpse of the Boomer consumer at age 70. The research was released at the What’s Next Boomer Business Summit, and will also be presented at the annual gatherings of the nation’s two largest professional associations in aging—the National Council on Aging (NCOA) and the American Society on Aging (ASA).  The research revealed that 93% of surveyed Boomers predict that they will have more time to do things like travel and dine out, and 76% predict they will use technology to stay connected to family and friends.

Market researchers Mintel report that last year alone Brits went on no less than 205,000 health and wellness holidays, spending an estimated £135 million on these kinds of holidays and the fun doesn’t stop there, with sales set to increase by as much as 150% by 2011. “This sector (homeopathic tourism) is a thriving industry as a developing figure of well-off baby boomers take their health needs into their own hands plus pursue the elixir of eternal youth,” said Richard Cope, senior Mintel analyst.

“It seems many British tourists are developing a taste for a holiday with a difference. Tired of the fly and flop package deals, they are opting for spa holidays, holistic breaks or in some cases a medical break for a session of cosmetic surgery or dentistry. Although this is a niche market, health and wellness holidays are steadily growing into a high value business, with the average cost of a trip well in excess of the holiday market norms. This market is fuelled by those looking to escape the pressures of a culture of long working hours and what some operators see as an urge to retreat from the debilitating effects of the consumer society,”

Medical Tourism is yet another sector that New Zealand is missing out on as there seems little government resolve in developing this market.  

Our neighbours, Australia, held their first Health and Wellness Tourism conference in September 2009.   At that conference, it was discussed how Health and Wellness tourism is estimated to be worth in excess of US$1 trillion and is one of the fastest-growing drivers in the travel industry.  Ruth Grau, Springboard Vacations USA and Medtral NZ has stated that New Zealand has a potential of 2000 medical tourists a year ( Inside Tourism 742, June 19, 2009), and explains why New Zealand is attractive to medical tourists.   In addition, Dr. Hans Raetz, who is involved in the development of a Southern Cross private hospital in New Zealand tourism hotspot Queenstown says that there is a real possibility for medical tourism at the resort (Travel Memo 24 March 2009).  In fact, the Tourism Industry Association of New Zealand, in its brief to the incoming Minister of Tourism in December 2008, stated that the “wellness market (has) the potential to attract high value visitors and would benefit from target marketing’.  Meanwhile, Medical Tourism “has not been something that has been considered’, according to Associate Minister of Tourism Jonathan Coleman (Inside Tourism 742, June 19, 2009)

So writes JoAnn Hines.  Boomers are a prime and growing target audience. According to Rick Adler, founder of The Senior Network: “Simply based on population growth trends, if a product is marketed to the 50-plus audience and maintains its market share, it should increase in sales by 35 to 50 percent in the next 20 years. Conversely, a brand targeted at the zero to 50 age groups will be flat in sales.” 

For example, in America:

• Those age 50-plus control $7 trillion, or 70% of all US wealth.
• The 50-plus group brings in $2 trillion in annual income that they want to and are willing to spend.
• One baby boomer turns 50 every 7 seconds of every day.
• With 76 million U.S. boomers in command of today’s buying decisions, the potential for profit and growth from this group is enormous.
• AARP estimates 54 million baby boomers will be between the ages of 50 and 64 by 2010.
• 90 million Americans will be age 50 or greater in 2010

 More………..

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The Rolling Rains Report notes two upcoming conferences on Access Tourism.  In Brazil we have

from 30/11-3/12/2009), while in Catalonia we have  Accessi Tourisme Simposium (30/11-1/12/2009).  This in addition to the UN ESCAP-Takayama Congress on access and tourism in the Asia-Pacific region (see 13/11/2009 post, below).

Aussies realize potential of medical tourism while NZ turns its back on this lucrative market. Continue Reading