Medical Tourism Not Yet Hurt by Thai Turmoil

Posted by: Bruce Einhorn on April 22, 2010

Even as Bangkok has been hit by political unrest, Thailand’s medical-tourism industry has been surprisingly resilient. Overnight, one person died and 78 were injured when at least five grenades exploded in Bangkok’s financial and tourist district. (Note that this is the updated figure, based on a statement to Bloomberg News by the Health Ministry; earlier, Deputy Prime Minister Suthep Thaugsuban had said three people died.) This was the latest fatal incident in the capital, where 25 people were killed and more than 800 injured earlier this month when the military tried to force the Red Shirts - anti-government protesters who support deposed Prime Minister Thaksin – to end their demonstrations in the city. According to Bloomberg News, about 14,000 Red Shirts have rallied in the center of Bangkok, “where they set up showers next to the Four Seasons Hotel and slept under advertisements for Prada and Louis Vuitton.”

You might think this would be huge turnoff for investors in Thailand’s hospitals, which count on patients coming from overseas - people who might stay at the Four Seasons, wear Prada clothes and carry Louis Vuitton bags - for an important part of their revenue. So far, though, investors are surprisingly sanguine about the impact of the unrest. Since the Red Shirt demonstrations started last month, the stock price of Bumrungrad Hospital, probably the premier destination in Thailand for international patients, is only down about 8 percent; meanwhile, Bangkok Chain Hospital is down just 1 percent and Bangkok Dusit Medical is actually up by 0.8 percent. (The benchmark Thai index is down 1.7 percent.)

What explains such confidence? In part, the timing of the Red Shirt revolt. As analyst Raweenuch Piyakriengkai of KGI Securities wrote in a report on April 1, the second quarter of the year is low season for the health-care sector, regardless of what’s happening in the streets. “It is the off-peak tourism season which means less international patient traffic,” Raweenuch wrote.

Since that KGI report came out, though, the once-peaceful protests have turned deadly. The situation could get much worse soon, given the huge political and economic divide between Bangkok’s upper and middle class Yellow Shirts and the northeast’s poor Red Shirts. If and when it does, I would expect the Thai hospitals to take a big hit. Medical tourists from Southeast Asia, the Middle East, Europe and America have plenty of other options for their hip replacements or tummy tucks without having to brave turmoil in Thailand.

Reader Comments

C. H. Ng

April 22, 2010 11:57 PM

What a pity & what a mess! A beautiful country & her peaceful people became emboiled in one messy situation. But as a foreigner, we have no rights to interfere in their affair. We should let the Thai people resolve the problem by themselves.

Having said that, I would like to point out one of the bad things about the democracy system is to allow all these mass protests. If it is used to bring down a hated regime / government, that's alright. But it's being used to bring down one party so that another party can start ruling, then it's not proper as the fallen party can always use the same tactic so much so this tit-for-tac way becomes never ending. In the end all the people suffer, physically & economically.

That's why I always used to say... whatever form of government may be, so long as it can rules the nation peacefully & brings much development to the whole country & her people, then it's a good government.

Cherie Bright

April 23, 2010 7:23 AM

Kiki and I were in Thailand when it all happened. It was inconvenient as many roads were blocked or closed but it was also known what areas needed to be avoided.

Cherie

james goldberg

April 23, 2010 2:59 PM

Bumrungrad Hospital, most probably a subsidiary of Tenet Health Care (see Tenet annual report 2002, 2003)is in the heart of Bangkok. If you think that this report is reliable, then please contact me immediately...I have a Bridge linking Manhattan and Brooklyn which I am anxious to sell.

For more information about Bumrungrad and Medical Tourism, see The American Medical Money Machine: The Destruction of Healthcare in America available on Amazon.

DanTe

April 23, 2010 8:02 PM

For now, Thailand is the only game in town when it comes to medical tourism. No one can beat them for the price and accreditation by Western medical establishments. They are still the safest, cheapest place to be. Hong Kong would have given Thailand a run for it's money, but the for profit hospitals in Hong Kong are run like Mainland China companies - money first, safety and soundness LAST. And the way Hong Kong's going, it will never fix that. So Thailand really has no competition what-so-ever.

Gan

April 25, 2010 8:02 AM

It has to be seen how Thailand Government is going to quell the demonstrations and restore confidence. Latest developments across the globe are definitely a concern for a medical tourist and medical tourism industry as well.
This may give an opportunity for other medical tourism destinations like Malaysia, Jordan, Turkey, Singapore, Costa Rica, Mexico which ever is close to the patients' home country.
Wonder how many medical patients were impacted by ash clouds, unrest in Thailand.
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Bloomberg Businessweek’s team of Asia reporters brings you the latest insights on business, politics, technology and culture from some of the world’s biggest and fastest-growing economies.

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