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  • Writer's pictureChristian Fadi El-Khouri

Saudi Arabia: A future Medical Tourism Destination

Article picture, Medical tourism in saudi arabia by Christian Fadi El-Khouri

In the world of medical tourism, Saudi Arabia has predominantly been a source rather than a destination. For decades, patients, government-sponsored and out-of-pocket payers, have sought medical care in Western Europe, the US, and the UK.

The Kingdom is assumed to be a significant driver of state-sponsored medical tourism. I am aware of German clinics that, in the past, were kept afloat single-handedly by the stream of Saudi Arabian medical tourists. The discontinuation of this patient flow, whether due to economic shifts or royal directives, led to the demise of several of these clinics. I have often warned against relying purely on medical tourism, and even though it ties into our topic today, I will not elaborate any further now.

To get to the core of this article: Over the past three years, I have caught wind of the Kingdom's aspirations to transform itself into a top-tier medical tourism hub. From various conversations with regional contacts, the recurring narrative is straightforward: Saudi Arabia aims to be the premier destination for medical tourists in the Middle East and North Africa and globally. I have seen drafts for tenders and small initiatives by private enterprises. The questions posed to me then, as well as the question I am trying to answer in this article, is: "Is it possible for Saudi Arabia to emerge as a leading medical tourism destination, and if so, what steps should be taken?" Let's look at a couple of things that factor into this.

Medical Tourism in Saudi Arabia: State business

If there ever was an example of a nation that would require a state-coordinated effort to build a medical tourism destination, it is Saudi Arabia. With all the changes and developments it is undergoing, it has to be made abundantly clear that medical tourism is on the agenda and has to be a priority according to its strategic relevance. Otherwise, this would end up another lacklustre and underwhelming endeavour, as we see all too often around the globe. The Kingdom has the leadership and spirit to embark on this journey.

Saudi Arabia can create medical tourism incentives.

Medical tourism is not feasible for many destinations, as their healthcare providers often do not benefit from treating more complicated foreign patients than domestic patients. This lack of incentive will halt any ambition since governments ultimately have to rely on the cooperation of their healthcare providers. The positive effect of being a medical tourism destination is often not enough, bringing us back to the first point: It needs to be on the agenda and backed accordingly. Creating an incentive scheme that enables healthcare providers to tend to domestic patients and very demanding medical tourists is necessary. More importantly, the Kingdom can, in some regions, draft legislation in a way that sets incentives to hospitals, which will increase their willingness to jointly further the ambition and make it a reality.

The freedom to allow USPs to flourish 

The Kingdom finds itself in an ambivalent spot. Indeed, as medical tourism is concerned, it will start at zero. Without a doubt, some of their healthcare providers are excellent. Still, as far as inbound health and medical travel is concerned, there is little to build on. At the same time, this is a huge advantage. USPs can be crafted. While other destinations can only hope to shape their existing offers to gain a competitive advantage, Saudi Arabia is privileged to build what's necessary according to what is required and sought without potentially damaging ongoing ambitions. This is not limited to services or products but extends to the entire framework in which they will be conducted. With projects like NEOM, for which a completely new and independent system of law is the ambition, it is up to the decision-makers to shape the system so it does not limit the creation of USPs. 

One segment of medical tourism is the flight from jurisdictional prohibitions and ethical limitations of healthcare services. The above-mentioned greenfield approach to legislation allows for anticipation of future trends in health and medical care. While other regions of the globe can hardly influence the overall legal structure, the Kingdom has proven itself to be very dynamic in allowing the adoption of the latest trends. This is directly tied to the pulling force the KSA has on top talent. While financial considerations certainly play into the country's attractiveness towards experts, the ability to shape the futures of their industries is very alluring to top talent. We already see subject matter experts in the field of longevity relocating to the UAE, as this move allows for them to unfold the potential of their chosen fields of expertise indeed. The lack of over-regulation is fertile ground for the growth of success stories. 

World-leading talent and technology 

Prior points on the freedom to shape USPs directly tie into the Kingdom's pull towards work-leading talent and technology. Observable in the examples of sports (Football and Golf) or transportation (Volocopter), Saudi Arabia repeatedly manages to attract top talent and technology. This is, to an extent, driven by the significant financial upside offered. Still, one should pay attention to the power of a dynamic nation like Saudi Arabia on domain experts. To turn parts of the country into destinations for medical travellers, it will be essential to attract leading medical experts, many of whom are singular practitioners who own a portfolio of techniques, skills or both that are hard to find anywhere else. Getting these kinds of experts in the healthcare field, being in the treatment of specific diagnoses or experts in prevention to relocate and offer their services as part of a larger strategy will be one of the main drivers to make Saudi Arabia a medical tourism destination. And while these services come at a premium, this won't be an issue. Saudi Arabia will not compete in terms of price. They will likely compete on the highest quality services and innovation level, adding comfort and excellence in adjacent services to the mix. 

A massive rebranding effort 

The previously mentioned elements can and will be crucial determinants of success, but there is one major obstacle that I will address in this article. Saudi Arabia's history as a source market where medical tourism is concerned will be a difficult sell. The country is undergoing rapid changes in many areas, among which is a push to attract tourists. And while a "tourism trade deficit" (I don't think there is such a thing, but you probably understand what I mean) does not make attracting traditional tourists more challenging, in medical tourism, things look very different. Why would anyone travel to be treated in a country if the country's citizens leave it to receive medical treatment? The UAE, more specifically Dubai, had to face the same question. And while that contradiction is not necessarily as meaningful as it's often made to be, it holds some truth in the minds of patients and stakeholders. The strategy has to be well thought through and communicated expertly. Rebranding is possible, but it requires an understanding of the segments that are targeted. It will require marketing efforts that are probably unseen in the history of medical tourism. And while this will be a challenge, I'm confident the Kingdom will find a way to manage it.

Saudi Arabia - Medical Tourism Geography

Now, it is time to look at the geography of Saudi Arabia and how it could impact its positioning and strategic orientation in its future medical tourism ambitions. Especially since the COVID-19 pandemic, geography is increasingly important in health and medical tourism. The willingness of patients to travel to avail themselves of medical services abroad has changed since most of the world went into lockdowns, and flights have been put on hold for a while. This observation does not intend to suggest that people are unwilling to travel for medical services. Still, the distances, durations, and circumstances of travel they might endure will change their willingness to embark on such a journey. Shorter distances, quicker trips, and direct connections are preferred and increase acceptance.

Medical Tourism Market Segmentation

The accepted distance for medical travel will depend on the severity of the underlying medical condition and the patient's typology. The graphic below shows a partial segmentation of medical tourism by patient typology. The graphic is not exhaustive as to the totality of typologies but provides a sufficient overview of the segmentation per first-order motivation.

Segmentation of medical tourism with respect to patient typology as derived by Christian Fadi El-Khouri. It segments medical tourism into major and sub segments.
Medical Tourism Segmentation by Patient Typology, Christian El-Khouri (2022)

A brief explanation of each segment:

  • Best quality: Patients of this typology seek the best treatment option globally. These tend to be very affluent people, often (V)VIPs, heads of state and ministers and the C-Suite/upper management of large national or multi-national conglomerates. (Dimension: Absolute/Qualitative)

  • Better quality: The historically most prominent typology of medical tourists. These patients seek better treatment than is available domestically/in their home country. While there are some financial limitations, price is not the determining factor. (Dimension: Comparative/Quantitative)

  • Shorter waiting times: Patients within this segment are looking for shorter waiting times at comparable or even better quality than treatment in the domestic setting. Where shorter waiting times are concerned, medical tourism is less sensitive to price. (Dimension: Comparative/Quantitative)

  • Lower price: Where quality medical care is available but not readily accessible due to financial constraints, patients seek lower-price destinations that provide parity in quality or even a slightly lesser recognized quality level as long as it fits their budget. Price sensitivity is, by nature, high. (Dimension: Comparative/Quantitative)

  • Border regions: Border regions are an interesting phenomenon in medical tourism segmentation as they are usually a mix of multiple typologies merging into one, all emphasized through the destination's proximity to the patient's country of residence. (Dimension (Binary/Mixed)

  • Health-promoting infrastructure: Whenever patients seek out a destination because it allows for a positive impact on an individual's health due to specific characteristics (think air quality near shores or forests), it is classified under the typology of health-promoting infrastructures. (Dimension Binary/Qualitative)

  • Legal and socio-ethical restrictions: Some destinations allow for certain types of medical processes, treatment or medication that are restricted or prohibited in the patient's domestic setting. Whenever medical services of this sort are what a patient seeks to circumvent restrictions in their home country, it is typologised within this segment.

What does that mean for Saudi Arabia?

Suppose Saudi Arabia positions itself in the "best quality" area provisions, such as true centres of excellence and innovative treatments, which is safe to assume. In that case, patients will consider travelling there more or less independently of travel distance and duration. And the country undoubtedly can do so. It is already home to some of the best-trained physicians within the broader region and features leading medical facilities, such as King Faisal Specialist Hospital and Research Center. Further, it is home to the most significant dental hospital, with the highly reputed King Saud University Medical City. However, this does not limit the potential of Saudi Arabia, where the focus on specialities is concerned; instead, it serves as proof that the Kingdom is already very advanced.

Patients who seek lower prices are susceptible to the travel conditions, to an extent because these impact the overall expenditure, but also since, for most of the world, more conveniently reached low-price destinations are available. This segment is virtually negligible to Saudi Arabia as the country will not compete on price but on quality. The likelihood and success of a primarily price-driven strategy in the case of the Kingdom is virtually zero.

An easy way to get a basic understanding of the dimensions of travel is to consult flight time approximations.

Showing a flight time approximation from Saudi Arabia to various places accross Europe, Africa and Asia.
The Approximate Flight Time Map is a fun tool to better understand travel duration and dimension. (Disclaimer: Use with caution, inaccuracies are likely and it shouldn’t be used for anything but personal curiosity.)

The map shows that the Kingdom covers Europe (a recently growing outbound medical tourism market) and the African continent (a traditionally active outbound medical tourism market) within 6-8 hours.

It is yet to be determined how Europe will evolve as far as outbound medical travel is concerned. Still, it will be price or waiting time-driven and less quality-oriented, as treatment quality is not a primary concern in the European Union. There is one medical speciality, or rather approach in healthcare, that I consider a strong motivator for European patients (affluent travellers, not sensitive to price) to seek out the Kingdom. However, I still need to explore the European outbound health tourism market thoroughly.

The upper socio-economic strata usually dominate the African medical tourism market. However, it will be interesting to see how the religious association of the lower strata might impact this behaviour, as pilgrims from African countries make up around 15% of total pilgrims during Hajj.

Additionally, very prominent medical tourism source markets such as Kazakhstan, Kyrgyzstan, Azerbaijan and parts of Russia and China are within the 6-8 hour mark. Many countries within that area have a history of sending patients abroad, either private patients paying out-of-pocket or state-sponsored medical tourism.

The role of the Kingdom's geography certainly warrants investigation, but I will leave it at that initial overview for Part 3.

If you are interested in learning more about the potential of Saudi Arabia in health tourism and medical tourism or destination development in general, follow me on LinkedIn and be notified when I post the following parts. The continuation of these thought pieces on Saudi Arabia's medical tourism journey will include:

  • A Structured Stakeholder Management Strategy for the Kingdom

  • Essential marketing and branding elements

  • Leveraging the Kingdom's high level of digitalization in healthcare

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