1. The document compares the medical tourism industries of Thailand and South Korea, two pioneering and emerging destinations in Asia. 2. It outlines how Thailand developed its industry by capitalizing on crises, promoting through its tourism authority, and gaining a reputation for affordable, high-quality care. Key events like 1997's financial crisis and the 2004 tsunami helped growth. 3. South Korea is emerging more recently through government support like legal changes allowing international promotion and partnerships with foreign hospitals. It aims to follow Thailand's model and benefit from its technological expertise.

1. Running Head: THAILAND AND SOUTH KOREA ON MEDICAL TOURISM AS A
NICHE MARKET SEGMENT
Thailand and South Korea on Medical Tourism as a Niche Market Segment:
Comparisons Between Pioneering and Emerging Medical Tourism Destinations
Rodelio Concepcion
California State University Fullerton

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I. Introduction: Medical Tourism As a Niche Market Defined
Medical tourism has been one of the emerging niches of tourism that is gaining
popularity in a number of countries. While this term has just been coined recently, this
phenomenon is not entirely new. According to Munro (2012), medical tourism “describes
the act of people making health choices and accessing health treatments across borders.
Depending on who is asking the question, it can be trade in goods and services, a health
choice, or a health service”. In terms of countries’ economic development, Horowitz,
Rosensweig and Jones (2007) defined medical tourism as “the patient movement from
highly developed nations to other areas of the world for medical care, usually to find
treatment at a lower cost”. They furthered added that medical tourism is different from
the traditional model of international medical travel where patients in general travel from
less developed countries to major medical centers and countries in highly developed
countries for medical treatment that is unavailable in their own communities. Strictly
speaking, according to Cohen (2008), the term “medical tourism” applies to “people who
travel to another country for medical treatment, which they will often combine with a
vacation, or to people who take the opportunity to receive such treatment in the course of
a vacation” (p. 25). Cohen (2008) further added that the term is “often indiscriminately
used in statistical reports to include all foreigners having received medical treatment in
the host country. As a result, because of this practice, the alleged scope of medical
tourism tends to be considerably exaggerated” (p. 25).
II. Countries with Medical Tourism as a National Industry

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There are around fifty countries that have identified medical tourism as a form of
national industry (Galinger, 2008). Southeast and East Asia have taken the lead in the
area of medical tourism (ESCAP, 2009). India, Malaysia, Singapore, and Thailand are
recognized as Asian medical tourism destinations (Connell, 2006; Henderson, 2009;
ESCAP, 2009). Furthermore, according to RNCOS (2008), Thailand, Singapore, India,
Malaysia and the Philippines are considered the frontrunners of medical tourism,
considered as major medical tourism destinations; however, other Asian nations, such as
South Korea, Jordan, the United Arab Emirates, and Israel, are considered as emerging
and newly preferred destinations. In Asia, Thailand and South Korea have been
emerging as prime destinations for medical tourism. These two countries have seen how
medical tourism can help in promoting themselves as premiere destinations for tourists
who seek quality and competitive medical attention and care at affordable costs
III. Thailand and Its Promotion of Medical Tourism
Thailand has exemplified the full potential of medical tourism as an industry and
has been successful in promoting this niche market. Heung, Kucukusta and Song (2011)
noted that medical tourism in Thailand successfully combines the tourism and healthcare
industries with major competitive advantages including affordability, price, reputation,
and strong tourism attributes such as Thai’s famed hospitality and friendliness. Thailand
was able to develop it medical tourism by taking advantage of some turning points in
history that would facilitate the development of its medical infrastructure, while coming
up with positive government policies that would encourage the industry’s growth, and
tactical promotions by the Tourism Authority. With Thailand’s success in transforming

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itself as a medical tourism hub, a lot of researches, studies and articles tackled it as a
subject.
According to Cohen (2008), Thailand’s healthcare and medical facilities and
industry did not develop until around late 1980’s to early 1990’s when a few private
institutions pioneered and introduced technologies and advancements in medicine, and
employing highly competent medical staff trained in Western countries. These
institutions initially catered to the medical needs of the elite and the expatriate
community in Thailand (Cohen, 2008).
Connell mentioned that a lot of private hospitals saw the need to look for other
revenue sources following the decline of local patients as brought by the 1997 Asian
Financial Crisis, and this saw the start of the development of medical tourism in Thailand
(as cited in Cohen, 2008). According to an online article from DPA (2013), “Bumrungrad
Hospital started promoting itself as a medical tourism destination in the wake of the 1997
Asian financial crisis, when many wealthy Thais lost their fortunes and could no longer
afford the American-run establishment’s costly services”. Bumrungrad Hospital in
Bangkok brought in a new management team from outside the country to manage its
program for international patients and to lead the hospital out of its financial difficulties.
Under this new management, Harryono, Huang, Miyazawa and Sethaput (2006) cited that
“Bumrungrad became the first internationally accredited hospital in Southeast Asia in
2002 and pioneered the medical tourism business” (p. 14). Since then, there are more
than thirty Thai hospitals with accreditation as of April 2013 (DPA, 2013). Moreover, a
lot of public and private medical hospitals and facilities in Bangkok, Pattaya, Phuket,

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Chiang Mai and other tourism places have since developed their own individual offerings
to cater and attract foreign visitors who are seeking medical attention, and would
sometimes tie it up with other tourism offerings. Cohen (2008) mentioned that Thai
hospitals use traditional media such as television, newspapers and travel magazines to
promote its services, as well as use alternative ways of promotion, such as tie ups with
major airlines, combining medical check-ups with vacation packages, working with
tourist agencies, and establishing direct linkage with targeted countries - even opening
offices there, or partnering with medical establishments in those countries.
The medical tourism development in Thailand was further facilitated by two
catastrophic events that hit the globe: the September 11 terrorist attack in the United
States, which drove people from the Middle East to seek medical treatments to alternative
locations such as Thailand, and the tsunami catastrophe that hit the southern part of
Thailand in 2004 where hospitals in that particular area of Thailand tried to accommodate
what Cohen called the high number of casualties (as cited in Cohen, 2008) that prompted
world-wide exposure and solid reputation overseas, and enticing foreigners to consider
Thailand as a destination for medical treatments, according to Limsamarnphun (as cited
in Cohen, 2008).
According to ESCAP (2009), Thailand government started the promotion of the
country as a medical tourism destination to other countries in 2004. These included
revisions of policies that would promote Thailand as a medical tourism destination.
Former Prime Minister Abhisit Vejjajiva highlighted the importance of medical tourism
to revive Thailand’s tourism industry during his personal visits and roadshows at various

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countries around the world. He underscored the measures taken by his government such
as waiving visa fees, reducing aircraft take-off and landing charges, lowering entrance
fees to national parks and providing travel insurance for foreign visitors (Niramitvijit,
2010). The same article of Niramitvijit (2010) also quoted Vejjajeva in a June 2009
speech in Beijing saying, “The government is also working on diversifying our tourism
industry so that tourists can enjoy cultural excursions while, at the same time, being able
to pursue other activities like spas, sports, medical check-ups and eco-tourism”.
The Tourism Authority of Thailand has been in the forefront in promoting the
country as a medical tourism hub, with its promotional events and activities abroad. It has
also set-up a website, http://www.thailandmedtourism.com, solely dedicated to medical
tourism, providing pertinent information such as the types of medical treatments
available, the locations of hospitals/clinics, destination guides, and packages and
promotions from both medical service providers and travel agents (as cited in Cohen,
2008).
The reputation of medical tourism services in Thailand has also been reinforced
by various government-sponsored promotional campaigns, notably by The Tourism
Authority of Thailand. In its “Amazing Thailand” campaign, an emphasis on Thailand
being the land of spas, hospitals and herbal products were highlighted (Russell, 2006).
This highlight in the tourism campaign efforts aimed at turning the country into a
regional medical hub in Asia (Arokhaya, 2005).
In an article by The Board of Investment (2012), the Thailand Medical Hub
Export 2012 reflected how the country has developed an outstanding fundamental

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structure in the medical field, as well as competent human resources are recognized to be
of international standard. The event depicted the reaffirmation of Thailand and The
Ministry of Public Health to show readiness and potential of the country to becoming an
international medical hub that is also affordable to both Thais and foreigners. The Board
of Investment article also mentioned that according to Prime Minister Yingluck
Shinawatra, “the Government has clearly set a policy, in which will to be implemented
from 2012 to 2016, to turn Thailand into a medical hub in four major areas: medical
treatment, health promotion, traditional Thai medicine and alternative medicine, and
health products, especially Thai herbs”. The policy is expected to bring in 800 billion
Baht in earnings in the next five years, according to Public Health Minister Wittaya
Buranasiri, as mentioned by The Board of Investment (2012) article.
Taking advantage of crises and catastrophic events in the past, the government’s
efforts and full support to the niche market, continued commitment of public and private
sectors in developing medical facilities and human resource expertise, and the heavy
promotion on the Thailand Tourism Authority of medical tourism in other countries have
helped in effectively marketing Thailand as a premiere medical tourism hub.
Furthermore, according to DPA (2013), good service, cheap prices and up-to-date
facilities made Thailand successful in medical tourism in the same reason as how it
became successful in mass tourism. Since the beginning of 2012, foreign tourists visiting
Thailand for medical services reached around 2.5 million, resulting to about 121.6 billion
Baht in revenue (The Board of Investment, 2012).

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Despite Thailand government’s full support on medical tourism, as well as the
heavy promotion of the country’s tourism authority, there are still some challenges and
consequences with the promotion of medical tourism. One of this is the alienation of
lower and middle-class Thai citizens who find the costs to be expensive relative to their
purchasing power, as Thai medical services offerings tend to increase in cost with the
development in infrastructure, facilities, technology and human resource expertise.
Medical tourism in Thailand attracts foreign audiences, but tend to alienate domestic
medical tourism.
Another challenge that might hamper the tremendous growth of this particular
niche market is the lack of the government’s strong legislation in some areas affecting
medical malpractice. The Thai legal system has weak enforcement that makes any
medical malpractice difficult to be tried, with those who commit the malpractice usually
prevailing in cases. Cloeman (2012) cited that,
“Once a patient decides to file a medical malpractice claim they will be faced with
a myriad of obstacles. The first obstacle is obtaining the patients on medical
records. In Thailand patients are not allowed to access their own medical records
to file a medical malpractice suit. This makes it extremely difficult for any patient
to prove their case. Because of the lack of medical malpractice jurisprudence in
Thai courts, cases typically settle due to being caught up in court procedure”.
IV. South Korea and its promotion of medical tourism

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South Korea is emerging as a new medical-tourist destination. It is rapidly
expanding its medical tourism offerings to capitalize on its potential offerings. It lags a
little bit behind the medical tourism powerhouses in the Asian region, despite South
Korea’s global medical standards and the high technical proficiency of Korean doctors in
medical services. South Korea needs to fulfill and develop this potential to become a
major player in the medical-tourism industry (Ji & Tae, 2012). However, South Korea
prides in its technological advancement in medical services, highly accomplished medical
practitioners and doctors, surprisingly low cost (compared to Japan and the United
States), and its weather and climate as its edge among competition (Korea Tourism
Organization, 2013). Additionally, CNNGo (2011) included fast scheduling that lures
foreign visitors to consider South Korea for medical procedures, specifically cosmetic
surgery and infertility treatments.
Gan and Song (2012) pointed the following as factors that help the growth of
medical tourism in South Korea: strong government support with many initiatives to
promote medical tourism; legal amendments and changes to resolve problems affecting
medical tourism promotion, established trade links with Japan and China, and promotion
of Jeju Island as a premiere medical tourism destination.
South Korean government has just recently acknowledged medical tourism
potential in the country. Before launching its medical tourism efforts and activities, the
government led an investigation called Biotech 2000 wherein it found out that investing
on the biotechnology industry would contribute to South Korea’s economic prosperity.
This study hoped to make South Korea as one of one of the world’s top seven

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biotechnology producing countries by 2010 (Wong, Uyen Quach,Thorsteinsdóttir, Singer
& Daar, 2004).
According to US-Korea Institute of The Paul H. Nitze School of Advanced
International Studies, Johns Hopkins University (2011), South Korea is developing its
medical tourism industry by copying the initiatives done by other Asian countries, and
expanding upon the concepts learned from these Asian neighbors. One of the first
initiatives was the government’s amendment of its legislation. To date, the US-Korea
Institute (2011), identified the following legislations amended to support medical
tourism:
1. Amendment to the Medical Services Act (passed January 8, 2009) that used to
prohibit hospitals from actively recruiting domestic and foreign patients. The
amended law now allows hospitals and medical institutions to actively look for
and promote services to foreign patients living overseas to receive medical care in
Korea.
2. Amendment to the Tourism Promotion Act (passed March 2, 2009) which is
designed to create legal grounds designed specifically to support a burgeoning
medical tourism industry; establish first-rate accommodation facilities; institute a
system to enforce travel contracts and ensure patient/tourist safety; and promote
travel agents’ hire of licensed tour interpreters.
3. Amendment to the Special Act on the Establishment of Jeju Special SelfGoverning Province and the Development of Free International Cities (passed
March 3, 2009) that aims to: establish a support system to cultivate the medical,

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tourism, and education industries of the Jeju self-governing province (most of the
authority of the culture, sports, tourism, broadcasting, and communications
minister allocated in the Tourism Promotion Act will be transferred to the
provincial governor); form a unique tourism promotion fund for Jeju; and permit
the government of Jeju to install an area within its administration as an English
education city, including the organization of international elementary, middle, and
high schools.
4. Revision of immigration laws to provide visa waivers to some countries or
relaxed requirements to facilitate travel for patients and their families. In Jeju for
example, the immigration law was revised to allow medical tourists and their
families may stay up to four years to receive medical treatment.
5. Laws have also been amended to allow local hospitals to form joint ventures with
foreign hospitals and clinics. Partnerships maintained by Korean healthcare
providers in the United States include the Hollywood Presbyterian Medical Center
(located in California), the Jaseng Center for Alternative Medicine (which has
facilities in California, New York, New Jersey, and Illinois), and the G Laser and
Aesthetic Institution (located in California). Korean hospitals also cultivate
relationships with health care providers beyond the United States. Konkuk
University Hospital, for example, maintains a partnership with Jiangsu Province
People’s Hospital and Tianjin First Hospital in China. (pp. 130 – 132)
The US-Korea Institute (2011) also cited that establishments of health related
bodies and institutes provided additional measures by the Korean government to promote
the medical tourism industry. The Korea International Medical Association (KIMA) was

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established in 2007 to promote Korean health care through advertising and publications,
as well as hosting and participating in international health conferences. KIMA works to
minimize malpractice lawsuits and works toward ensuring facilities and human resources
meet international standards. The KIMA website itself is specifically designed for
prospective medical tourists seeking treatment and holiday in Korea. In addition, the
Korean Health Industry Development Institute (KHIDI) was established in 1999 to guide
health care policy, steer health care research and development, enhance the management
and technology of hospitals, and support the competitiveness of the health industry. This
act authorizes KHIDI to spearhead support programs intended to improve the delivery of
the national health services and expand the global competitiveness of Korea’s national
health industry.
In 2009, the amendment of the Medical Service Act in 2009 aimed to position
South Korea as a Global Healthcare hub, with the launch of a nation-branding project
called “Medical Korea” (Medical Korea, 2013). According to The US-Korea Institute
(2011, p. 133),
“This campaign actively publicizes the Korean medical tourism industry at global
medical conferences as well as through international television, radio, and
newspapers. The Medical Korea campaign disseminates information about
Korea’s medical services, special treatments, hospitals, and foreign-language
communication services (targeting English-, Chinese-, Russian-, Japanese-, and
Arabic-speaking patients). The Korean Wave coincides with the government
nation-branding campaign. This explosion of Korean pop culture, including

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television dramas performed by flawlessly fashioned actors and actresses, also
collaterally contributes to the promotion of the plastic surgery component of
Korea’s medical tourism industry.“
Because of the Korean Wave, Medical Korea has since then appointed Korean
actors, singers and celebrities to be ambassadors of Korean medical tourism going the
rounds of different countries to talk about South Korea as a premiere medical tourism
destination.
Kim, Lee and Jung (2012) mentioned that in June 2011, the Korean Ministry of
Culture, Sports and Tourism and the Ministry of Health and Welfare announced a variety
of measures to motivate and stimulate the Korean medical industry. These measures,
according to Kim, Lee and Jung (2012) included “insurance compensation for wrongful
surgery or side effects following surgery, the integration of related laws, cooperation
between related public agencies, the establishment of Korean medical schools,
improvements in the visa system, regular evaluations of hospitals, quality assurance
systems, education of professionals in medical tourism, and the establishment of a
cooperative medical tourism website” (p. 426).
Regional governments as small as districts like Busan, Daegu, Jeju, Daejeon and
Gangnam District in Seoul are making an all-out effort to promote medical services in
Korea in different parts of the globe (Jae-un, 2013). Invitations to foreign tourists, tour
operators and journalists are extended by regional government agencies for site and
facility visits and medical expositions. These regions also set-up committees aimed at

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improving medical training and facilities at the local level. One example of tourism
promotion at regional level was cited by Ji and Tae (2012, p. 81) saying that,
“In recent years, the state government of Jeju has designated the island as a
special district for the medical-tourism industry in order to attract overseas
medical tourists especially from China and Japan, which are an hour’s flight
away. The government has determined to provide various investment incentives
for hospitals and relative businesses, such as medical travel agencies, including
financial and human resource assistance, and tax benefits”.
South Korea has since then developed its advanced technological medical
facilities and training and has been capitalizing on it as its differentiation in competing
with Asian medical tourism powerhouses like Thailand. It continues to promote and
invest, not just to attract the West but also medical tourists in nearby Asian countries and
the Middle East. This has seen an increase in the number of medical tourists arriving at
South Korea over the years. The amendments in legislations, the constant and consistent
promotion of different government bodies – whether of national or regional levels, and
the taking advantage of Korean pop culture has been proven effective in putting South
Korea in the map of emerging medical tourism destinations. According to data by Korea
Tourism Organization (KNTO), the number of foreign health tourists to South Korea is
estimated at 150,000 in 2012, up 25 percent compared to 122,297 in 2011 (International
Medical Travel Journal, 2013). However, IMTJ (2013) added out that the 2012 figures
are estimates rather than national figures and are actually of international patients rather
than just medical tourists.

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There are still some factors that hamper the tremendous growth on the medical
tourism sector in South Korea. There are still legislations that prevent its growth.
According to the Hyundai Research Institute, the weak performance of the medical
tourism sector in South Korea is mainly attributable to excessive regulations on local
hospitals wherein they are not allowed to have foreign patients exceeding 5% of their
capacity, and medical specialists with foreign licenses have limited leeway in working for
local institutions (International Medical Travel Journal, 2013).
According to Lee (2010a), medical laws in South Korea still do not address the
protection of foreign medical tourists from discriminatory pricing, medical malpractices,
privacy rights, and other growing concerns. Furthermore, there have been reports of
discriminatory pricing against foreign patients that ranged from twice to ten times in
price paid by local residents (Lee, 2010b; Lee, 2010c). Kim, Lee and Jung (2012) further
added that there is a lack of supporting legal systems for the issuance of medical visa,
medical claims and disputes, insurance, or indemnification.
Lastly, while South Korean facilities are known for its advancement, it lacks
promotion of scientific proof or standardized certification of such. According to Kim, Lee
and Jung (2012),
“it is important to publicize scientific evidence describing the outcomes of
empirical medical research…Poor promotion of Korean medical institutions leads
to a poor evaluation of their quality. For example, the international hospitals in
Thailand are rated A+ by international insurance companies, whereas Korean
hospitals are rated C+. “

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V. Conclusion
By looking at the medical tourism industries of a pioneering destination
(Thailand) and an emerging destination (South Korea), some similar patterns can be
drawn that would attribute to a successful promotion of medical tourism as a viable
tourism niche market. One of this is by starting to look at legislations and policies,
formulating ones that will support the flourishing of the industry, and amending the ones
that would hamper its growth. The second is by looking at unique and identifying
attributes that would make the destination standout among its competition. Thailand
offers the dual benefits of medical treatment and recuperation in beaches and resorts at a
cheaper cost. As for South Korea, it capitalizes on state-of-the-art facilities, expertise,
talent and knowledge of its specialists at an affordable cost, something that an
industrialized country can offer. Lastly, there are historical points that both destinations
took advantage of in order to further promote its medical tourism offerings. Thailand
made opportunities with global crises and catastrophes in order to highlight its
capabilities. South Korea took advantage of the Korean Wave in order to promote its
advancement in this field. However, these efforts will constantly be challenged because
of fierce competition in the promotion of medical tourism of other established and
emerging medical tourism hubs, growing demand for up and coming technologies (for
example, stem cell therapy) and the need to look at other policies and legislations on
continuing concerns of safety, pricing discrepancy and ethical issues. Continuous
development of the sector should be properly managed as the international medical
tourism market is continuously growing. Once the market becomes saturated by other
medical tourism destination promotions, it will be beneficial for Thailand and South

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Korea to do promotions based on its strong medical specializations such as internal
medicine, cosmetic surgery, as well as promote traditional medicine and therapy such as
oriental medicine and herbal medicine.

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