Malaysia Healthcare Chronicles 2009 - 2019: a 10 Year Journey of Malaysia's Healthcare Travel Industry

Malaysia Healthcare Chronicles: A 10 Year Journey of Malaysia’s Healthcare Travel Industry

MALAYSIA HEALTHCARE CHRONICLES 2009 - 2019: A 10 YEAR JOURNEY OF MALAYSIA'S HEALTHCARE TRAVEL INDUSTRY

Call Centre: +603 2726 8688 [email protected] www.malaysiahealthcare.org facebook.com/mhtcmalaysia instagram.com/malaysiahealthcare twitter.com/mhtcmalaysia linkedin.com/company/malaysia-healthcare-travel-council Malaysia Healthcare /məˈleɪziə ˈhelθkeə(r)/

(pn.)

Definition

Malaysia Healthcare is the brand created for the nation’s healthcare travel industry. Malaysia Healthcare comprises government ministries and agencies, premier Malaysian private healthcare facilities, airline companies, travel agencies, hotels and many more. Together we craft a seamless end-to-end healthcare journey experience for all our visitors. The Malaysia Healthcare brand was introduced in 2009 with its own logo and tagline, “Quality Care for Your Peace of Mind”.

CELEBRATING 10 YEARS OF MALAYSIA HEALTHCARE

The Malaysia Healthcare Chronicles is a compendium of Malaysia’s healthcare travel industry growth and accomplishments over the past 10 years. MALAYSIA HEALTHCARE CHRONICLES IN THIS REPORT VOICES OF THE INDUSTRY CHAPTER 2: MALAYSIA CHAPTER 5: TOWARDS A BETTER HEALTHCARE: ASIA’S BEST KEPT TOMORROW Minister of Finance, Malaysia SECRET 5.1 Building the Future of Malaysia Minister of Health, Malaysia 2.1 History of the Industry Healthcare CEO of Malaysia Healthcare Travel 2.2 Malaysia Healthcare Travel Council 5.2 Outlook and Prospects Council 2.3 Malaysia: A Unique Healthcare President of Association of Private Destination for All Hospitals of Malaysia

LIST OF PARTNERS CHAPTER 3: THE INTEGRATED GLOSSARY VALUE CHAIN OF THE List of Malaysia Healthcare Partners HEALTHCARE TRAVEL INDUSTRY Glossary of Terms and Abbreviations (2009 -2019) 3.1 Close Working Partnerships Amidst an Integrated Value Chain 3.2 Malaysia Healthcare: Key Players and Industry Structure 3.3 Addressing Industry Challenges and Gaps Across an Empowered Value Chain 3.4 Enabling Malaysia Healthcare’s Growth and Progress

CHAPTER 1: AN OVERVIEW OF CHAPTER 4: MALAYSIA THE GLOBAL AND REGIONAL HEALTHCARE’S PERFORMANCE: HEALTHCARE TRAVEL LANDSCAPES KEY INSIGHTS

1.1 Key Drivers and Trends in 4.1 Key Market Trends and Industry Healthcare Travel Performance 1.2 Global Healthcare Travel: 4.2 The Healthcare Travel Economic Key Insights Multiplier Effect 1.3 Regional Healthcare Travel: 4.3 The Healthcare Traveller Profile Key Insights 4.4 Key Insights into Malaysia 1.4 Leveraging on Players Within the Healthcare’s Performance by APAC Region Market and State 1.5 Malaysia’s Continued Rise in 4.5 Malaysia Healthcare’s Positive Healthcare Travel Impact on Local Healthcare 4.6 Milestones, Awards and Accolades Malaysia Healthcare Chronicles 2009 - 2019: 2 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

VOICES OF THE INDUSTRY

Message from the Minister of Finance, Malaysia DEVELOPING GROWTH DRIVERS FOR MALAYSIA

The success of Malaysia’s healthcare travel industry has been most encouraging given that not too long ago, it was just a fledgling niche sector that was started in line with providing new, services-based engines of growth for Malaysia.

Malaysia Healthcare, as the industry is known, has averaged a compounded annual growth rate (“CAGR”) of 9% and 15% for revenue receipts and traveller arrivals respectively over the past 10 years with the peak of 17% CAGR from 2015 to 2018.

The success of Malaysia Healthcare is due to the effective public-private partnership developed, which has enabled the industry to flourish. The government’s commitment to the private healthcare industry through investment tax allowance and incentives have attracted almost MYR10 billion in private investments up until 2018, of which more than MYR1 billion was from foreign direct investments and more than MYR8 billion from local investments. This indicates the strength and continuous confidence of foreign and local investors in Malaysia’s healthcare travel industry.

The results of these and other measures, including expanded investment by private sector players, have collectively delivered industry growth. Bed capacity of the private sector today stands at about 15,000 units YB TUAN LIM GUAN ENG nationwide. Progressively, we have seen an increase Honourable Minister of Finance, Malaysia in the number of hospitals in Malaysia tapping the healthcare travel market and over 15,000 jobs created. In Penang, a MYR2 billion development by foreign investors will lead to a 1,000-bed hospital, the largest private hospital in Malaysia. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 3

In terms of revenue, the CAGR has been an encouraging vein, we call upon private sector stakeholders across 17% from 2015 to 2018. In 2018 alone, revenue receipts the value chain to take the lead and rise to embrace reached MYR1.5 billion from an excess of 1.2 million the challenge and immense opportunities within the healthcare traveller arrivals, contributing MYR6.4 sector. As the private sector increases its involvement, billion to the GDP. As a niche sector, healthcare travel government investments in healthcare travel can be comprises some 7.6% of total tourism revenues and is optimised towards delivering better growth rates and expected to grow strongly going forward. success.

Clearly, Malaysia Healthcare is well on track towards The future is promising, and by working together, we becoming one of Malaysia’s high-potential sectors with can realise the goal of establishing Malaysia as the No.1 a significant yearly gross domestic product (“GDP”) healthcare travel destination in the region and ultimately contribution. as one of the preferred healthcare destinations in Asia.

Given the healthcare travel industry’s significance to the nation, it has been given further impetus, notably under YB Tuan Lim Guan Eng the 10th and 11th Malaysia Plan and the Economic Transformation Programme. The target is to have Honourable Minister of Finance, Malaysia Malaysia Healthcare deliver 25% growth with over MYR1.8 billion in hospital revenues and an estimated total economic impact of MYR8 billion for 2019.

Year 2020 will see Malaysia Year of Healthcare Travel 2020 (“MyHT2020”), in conjunction with Visit Malaysia 2020 (“VM2020”). In accordance to the upcoming 12th Malaysia Plan for the development dimension of Economic Empowerment, healthcare travel will bring spillover effects benefitting other industries as well.

As we strive towards a new and better Malaysia, one that is globally competitive and economically resilient, I call upon all stakeholders across the value chain to work together in realising the industry’s fullest potential.

The government will certainly continue to do its part in facilitating healthcare travel growth. In the same Malaysia Healthcare Chronicles 2009 - 2019: 4 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

VOICES OF THE INDUSTRY

Message from the Minister of Health, Malaysia SERVING THE NATION, DELIVERING TRUST AND CONFIDENCE

Malaysia has a unique dual healthcare system consisting of public and private healthcare streams that serves all segments of the community, nationwide. Healthcare is a basic right for all Malaysians and the Ministry of Health (“MoH”) has and continues to take all efforts towards ensuring that Malaysians can exercise this right.

The public-private healthcare system shoulders healthcare expenditure of about MYR60 billion with 55% borne by the government and 45% through private consumption. Under strict regulations and standards, both public and private healthcare have developed over time to be highly regarded as one of the best globally. We are proud that our healthcare system has been recognised by the United Nations Development Programme (“UNDP”) as a model for other developing countries to emulate. Independent US-based International Living magazine has also acknowledged us as a country with one of the best healthcare systems in the world for 5 years running.

The result of our efforts is that for decades, Malaysians have had access to state-of-the-art hospitals, breakthrough treatments and procedures, professionally qualified doctors and medical personnel, and a wide range of facilities and services on par with that of well- YB DATUK SERI DR. DZULKEFLY developed countries. The availability of these service AHMAD offerings are telling of the sustainability and resilience Honourable Minister of Health, Malaysia of our healthcare system. MoH has provided extensive support in ensuring our two-tiered health system continues to excel. The private Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 5

healthcare sector adheres to the Private Healthcare The Malaysia Healthcare Travel Council is a key Facilities and Services Act, in effect since 1998, ensuring component of our overall strategy to develop the that the quality of healthcare provided is at a high-level Malaysia Healthcare brand. We will continue to present with clear benchmarks set for infrastructure, equipment the best of Malaysia Healthcare to the world, to deliver and personnel. This includes access to healthcare and the best services for healthcare travellers, to allow we are proud to say that 90% of Malaysians live within 5 more focused and cohesive promotion and marketing kilometres of a primary healthcare provider or facility. of Malaysia Healthcare, and to encourage industry excellence and self-motivation towards continuously The strong regulation implemented by MoH upon the improving facilities and services. healthcare system of Malaysia has brought peace of mind to patients who have sought treatment with We will continue to do our utmost in further developing Malaysia Healthcare while building trust among them as the all-important trust factor, towards continuing to earn well. the confidence of the world and to continue delivering on our promise of “Quality Care for Your Peace of Mind” for In addition, the enforcement of Medical Fees Schedule all Malaysians and all patients. 13 ensures medical cost effectiveness and enables patients to enjoy high quality universal healthcare. This also promotes price competitiveness as this regulation YB Datuk Seri Dr. Dzulkefly Ahmad caps professional fees at a reasonable level. MoH has also focused on encouraging exemplification of patient Honourable Minister of Health, Malaysia safety, clinical-based outcomes, continued development of centres-of-excellence, research and development activities as well as pioneering new, groundbreaking and innovative treatments. With healthcare travel in the picture, return-on-investments for all these developments have been expedited in a sustainable manner, keeping costs at manageable levels.

Progressively, through MoH’s efforts and that of the private sector, trust and confidence have developed in Malaysia’s healthcare sector. This trust factor has led to people outside of the country looking to Malaysia for their healthcare needs.

The Ministry will play its part in supporting the development of the healthcare travel sector. However, I wish to reiterate that MoH’s priority remains to meet the healthcare needs of the Rakyat first and foremost. At the same time, healthcare travel will promote the establishment of better services and equipment which will serve international patients and benefit Malaysian patients simultaneously.

Supporting the healthcare travel industry has brought about much benefits for the people of Malaysia: private healthcare facilities continually strive to maintain or surpass global standards, invest in the latest technologies and expand their supply capacity. Malaysia Healthcare Chronicles 2009 - 2019: 6 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

VOICES OF THE INDUSTRY

Message from the CEO of Malaysia Healthcare Travel Council GROWING THE MALAYSIA HEALTHCARE BRAND

Malaysia Healthcare’s dynamic and tremendous achievement as a thriving healthcare travel industry has only been growing steadily over the past ten years. The year 2018 marked a major milestone in the history of Malaysia’s healthcare travel industry, being 10 years since the Malaysian government pledged its support for the sector by establishing MHTC.

The government’s sustained support in growing Malaysia Healthcare over the last decade has seen the industry double in size, welcoming 1.2 million international healthcare travellers in 2018 alone, with a total spend of MYR1.5 billion.

Malaysia Healthcare, once known as the “Hidden Jewel of Asia”, has been internationally recognised as the “Destination of the Year” for healthcare travel by UK- based International Medical Travel Journal and “Best Country in the World for Healthcare” by US-based International Living magazine. These recognitions are now a testament to the close and effective collaboration between public and private sectors.

SHERENE AZLI Chief Executive Officer Malaysia Healthcare Travel Council Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 7

As one of the key agents in driving the Malaysia On that note, I would personally like to thank the Healthcare brand, MHTC has played an essential role members of MHTC’s Board of Directors, whose to facilitate and promote the healthcare travel industry invaluable leadership, vision, effort and unwavering of the country. We have intensified our efforts towards support have underpinned Malaysia Healthcare’s facilitating more public and private sector partnerships, success. We look to foster stronger collaboration identifying and bridging gaps across the industry value and involvement from key parties such as Ministry of chain and ultimately looking to enhance the value Health, Ministry of Tourism, Arts and Culture, Ministry proposition that Malaysia offers to healthcare travellers. of Economic Affairs, Tourism Malaysia, Malaysian (Please see page 10-11 for our full list of partners and Investment Development Authority, Jabatan Imigresen affiliates). Malaysia, Malaysian Society for Quality in Health, Malaysia External Trade Development Corporation and MHTC is focused on optimising the healthcare travellers’ Association of Private Hospitals of Malaysia. experience by addressing existing gaps within their medical journey. The goal is to provide a seamless, I take this opportunity to thank everyone in MHTC satisfying end-to-end experience for patients that for their stellar contributions and their exemplary delivers trust, confidence and peace of mind. MHTC has professionalism, which has certainly been critical in the identified various areas for enhancement across the development of Malaysia Healthcare. patient journey and will work with multiple stakeholders to close these gaps. My highest gratitude too to all our partners and stakeholders that have together brought Malaysia In light of the industry’s successes, MHTC’s shift to the Healthcare to where it is now. Ministry of Finance (“MoF”) reflects the government’s focus on the healthcare travel industry to drive further #kitamenangsamasama economic growth, and prioritising enhancements of the nation’s overall healthcare sector. MHTC’s growth from a small unit within the Ministry of Health to its present Sherene Azli position as a strategic agency under MoF emphasises the overall growth of the nation’s healthcare travel Chief Executive Officer sector and its immense prospects as a national growth Malaysia Healthcare Travel Council engine going forward.

We will continue highlighting Malaysia’s three key strengths: world-class quality, almost-real-time accessibility and competitively affordable healthcare, complete with a seamless end-to-end patient journey experience, affording healthcare travellers Quality Care for Your Peace of Mind. Leveraging on our unique service offerings, we will continue to drive greater brand awareness, appeal, and confidence in Malaysia’s attractiveness as a leading global healthcare destination. Malaysia Healthcare Chronicles 2009 - 2019: 8 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

VOICES OF THE INDUSTRY Message from the President of Association of Private Hospitals of Malaysia ELEVATING MALAYSIAN PRIVATE HEALTHCARE TO NEW HEIGHTS

The Association of Private Hospitals of Malaysia (“APHM”) views the nation’s dual healthcare system of public and private streams as highly effective in meeting the needs of Malaysians for quality, accessible and affordable medical care. In fact, in recent years, healthcare expenditure as a component of Gross Domestic Product has been evenly balanced at almost 50% each for the private and public sectors.

In continuing to fulfil its strategic role to the Malaysian economy, the private healthcare sector must pursue new growth strategies. Given the changing landscape for healthcare due to emerging technologies, higher patient expectations, globalisation, the ease of travel and other factors, looking beyond one’s immediate market space is a beneficial, long-term strategy to ensure sustainable growth.

Malaysia’s private healthcare, having been long established, certainly has the competitive ability and required quality to serve international patients. Tapping the expanding healthcare travel sector will consequently improve and enhance Malaysia’s value proposition towards setting new benchmarks for quality, accessibility and affordability. Our efforts to tap ASEAN YBHG DATUK DR. KULJIT SINGH and Asia are also in line with our drive to support our President neighbours under the Continuous Medical Education Association of Private Hospitals of Malaysia initiative. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 9

The influx of travellers seeking healthcare in Malaysia of three founder members of the Malaysian Society for will drive economies of scale, aid private sector Quality in Healthcare (“MSQH”), the sole internationally operators to optimise service capacity, encourage recognised accreditation body in Malaysia – the other them to introduce new medical technologies and being MoH and the Malaysian Medical Association infrastructure and ultimately support their efforts to (“MMA”). maintain the affordability of private healthcare treatment for Malaysians. As we look to support the growth of the healthcare travel sector, APHM will continue to play its part in ensuring Industry growth also provides Malaysian professionals that Malaysia’s private healthcare sector fulfils its vital with a wider range of case-mix, thus enhancing the role in supplementing the public healthcare system and expertise of our doctors, nurses and other medical staff. reducing some of the strain placed on the public sector. It also generates jobs and supports the retention of local talent, thereby reducing the brain drain effect, which the industry presently faces. YBhg Datuk Dr. Kuljit Singh

APHM is committed to playing its role in Malaysia’s President continued emergence as the leading global healthcare Association of Private Hospitals of Malaysia destination in the world. We have grown to be 140 members strong out of 210 private healthcare facilities available in Malaysia. Our focus is to support APHM members towards increasing their service capacity and expertise, and to achieve global quality benchmarks. We will continue to support the government’s efforts and the industry’s players, such as MHTC, towards developing a robust, world-class and sustainable private healthcare travel sector in Malaysia.

In this regard, the private sector is appreciative of the assistance and incentives provided by the government. The various forms of support provided has enabled the private sector to grow and remain competitive in today’s environment.

The government’s public-private partnership model has proven highly successful in developing the local value chain. Our strength in numbers, quality and capacity is well positioned for the public sector to leverage upon in serving the Malaysian community. In the past, we have worked well with MoH in ensuring quality of care and safety of patients in private hospitals. The APHM is one Malaysia Healthcare Chronicles 2009 - 2019: 10 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

LIST OF PARTNERS

LIST OF MALAYSIA HEALTHCARE PARTNERS (2009 -2019)

No. Ministries, Stakeholders and Partners

1 Absolute Beauty Asia and Absolute Bariatric Asia - Australia 2 AIA (Cambodia) Life Insurance PLC 3 Aionia Medical Travel - Australia 4 AirAsia Berhad 5 Association of Private Hospitals of Malaysia 6 Berrypay (M) Sdn. Bhd. 7 Cambodian Public Bank (“Campu Bank”) 8 Canadia Bank PLC 9 Darussalam Holdings Sdn. Bhd. - Brunei 10 Datkhina Dipar Co. Ltd. 11 DG Medical (“Medifly”) 12 e-Healthcare Vietnam Group (“EHC”) 13 Flywire (Singapore) Pte. Ltd. 14 GD Assist Ltd. - Bangladesh 15 Global Health Assist 16 Great Angkor Tours Co. Ltd. 17 HealthFyx Pte. Ltd. (formerly known as GHT) 18 IB Capital Links 19 Institut Kanser Negara (“National Cancer Institute”) 20 International Living 21 InvestKL 22 Iskandar Regional Development Authority (“IRDA”) 23 Islamic Tourism Centre 24 Jabatan Imigresen Malaysia 25 KL Tourism Bureau 26 LaingBuisson/ International Medical Travel Journal (“IMTJ”) 27 Malaysia Airlines Holdings Berhad 28 Malaysia Convention and Exhibition Bureau (“MyCeb”) 29 Malaysia Dental Council 30 Malaysia External Trade Development Corporation (“MATRADE”) 31 Malaysia Healthcare Partner Hospitals 32 Malaysia Medical Association 33 Malaysia Medical Council 34 Malaysia Myanmar Business Chambers Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 11

35 Malaysia Productivity Corporation (“MPC”) 36 Malaysian Business Council of Cambodia (“MBCC”) 37 Malaysian Investment Development Authority (“MIDA”) 38 Malaysian Society for Quality in Health (“MSQH”) 39 Manam Service Co. Ltd. 40 Medical Travel Companion 41 Medihelp Sdn. Bhd. 42 Medo Asia Sdn. Bhd. 43 MIMOS Berhad 44 Ministry of Economic Affairs 45 Ministry of Finance 46 Ministry of Health 47 Ministry of Home Affairs 48 Ministry of International Trade and Industry 49 Ministry of Tourism, Arts, and Culture 50 Ministry of Tourism, Arts, Culture, Youth and Sport Sarawak (“MTCAYS”) 51 MJ Health Screening Centre Sdn. Bhd. 52 Myanmar Escapade Travel and Tours Co. Ltd. (“METT”) 53 Nature Link Travel and Tours 54 NCH Consumer Healthcare Ltd. - Bangladesh 55 Northern Corridor Economic Region (“NCER”) 56 Oze Travel - Australia 57 Patients Beyond Borders 58 Penang Centre of Medical Tourism (“PMed”) 59 Penang Global Tourism 60 Penang Institute 61 Private Hospital Association of Myanmar 62 PT AA International Indonesia 63 PT AXA Services Indonesia 64 PT Bank Central Asia Tbk 65 PT Bank Maybank Indonesia 66 PT Medika Rescue International 67 Recapture Beauty - Australia 68 Royal KPM Travels and Tours Co. Ltd. (“Royal KPM”) 69 Sabah Tourism Board 70 Sarawak Tourism Board 71 Tourism Johor 72 Tourism Malaysia 73 Tourism Melaka 74 Tourism Selangor 75 Vietnam Malaysia Business Association (“VMBIZ”) 76 Xiamen Tai Orient Health Management Co. Ltd. 77 Xiamen YunLv Health Management Co. Ltd.

Our highest gratitude and appreciation to Ministries, stakeholders and partners. WHAT IS HEALTHCARE TRAVEL?

“Act of travelling for the purpose of receiving treatment for a disease, ailment or medical procedure or well-being and recuperation.1

PROFILE 1 PROFILE 2 ’’ Originates from developed countries with Limited by inadequate local healthcare system sufficient local healthcare systems, but has (including private healthcare) in terms of: difficulties accessing their local healthcare system. Challenges faced include:

Inability to treat certain conditions Long waiting times (especially for conditions deemed non-life Lack of medical facilities or threatening) equipment Shrinking or lack of coverage, Long waiting lists especially for services like dental and cosmetic surgery Lack of trained doctors, especially specialists Expensive private healthcare and complex insurance coverage with

MOTIVATION Poor service quality (i.e. lack of huge ‘out-of-pocket’ portions. patient empathy and patient care)

Lack of confidence in their own healthcare system.

PO PU LA N T IO IO T Financial Demographics N A T • Government spending • Aging population H N • Health reform • Chronic disease E E A • Alternative financial/ • Communicable disease L M T G business models • Access H A • Public/private • Consumer engagement / R V partnerships O 1 F Deloitte (2008).E Healthcare travel: Consumers in Search of Value. Available from http://www.deloitte.com/assets/ L U DcomUnitedStates/Local%20Assets/Documents/us_chs_MedicalTourismStudy(3).pdfD M

Operational L Innovation

• Infrastructure U • Medical advances E • Waste • Digital connected • Alternative care health delivery/ operational • Data/analytics models COST • Talent • MBA

Regulatory • Patient and product safety • Cybersecurity • Fraud & abuse

EF FE RE TIV CA E, E BLE FFICIENT, EQUITA

Malaysia Healthcare Chronicles 2009 - 2019: 14 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 1: AN OVERVIEW OF THE GLOBAL AND REGIONAL HEALTHCARE TRAVEL LANDSCAPES

1.1 Key Drivers and Trends in Healthcare Travel 1.2 Global Healthcare Travel: Key Insights 1.3 Regional Healthcare Travel: Key Insights 1.4 Leveraging on Players within the APAC Region 1.5 Malaysia’s Continued Rise in Healthcare Travel Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 15

1.1 KEY DRIVERS AND TRENDS IN HEALTHCARE TRAVEL

The motivations behind healthcare travellers vary based on a wide range of factors. Beyond more affordable cost of treatments and ease of travel and convenience, other factors that influence their choice of destination include their unique circumstances that influence or impact their access to quality healthcare.

The general trend is that beyond just provision of healthcare, society’s increasing expectation is that healthcare must be easily accessible, affordable, of a high quality and sustainable over the long-term.

Globally, healthcare and its subsector, healthcare travel, continue to see robust growth which is spurred by many factors. Among them are difficulties in securing appointments, inflation in healthcare costs, development in ease of travel, demand for treatments supported with the latest technology and the rise of the world’s ageing population.

Regardless of whether a healthcare traveller identifies themselves as a Profile 1 or Profile 2 healthcare traveller, these groups of niche tourists change the world of healthcare in their own way.

1.1.1 Factors Driving Healthcare Travel Globally

IMMEDIATE APPOINTMENTS

Many countries across the world face overwhelming demand for healthcare and are unable to meet the needs of their respective local communities. For example, in Hong Kong, there have been cases where patients have waited for more than three years to see a specialist due to the issues faced with stable new case bookings at specialist outpatient clinics.2 In China, the healthcare system faces an overwhelming demand for specialists to cater to minor ailments, whereby specialists who see up to 200 patients a day are overworked and over-burdened.3

2 https://www.scmp.com/news/hong-kong/health-environment/article/3009592/patients-waiting-more-three-years-specialist-care 3 https://www.cnbc.com/2018/10/01/chinas-health-care-crisis-lines-before-dawn-violence-and-no-trust.html Malaysia Healthcare Chronicles 2009 - 2019: 16 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 1

An Overview of the Global and Regional Healthcare Travel Landscapes

COSTLY PRIVATE HEALTHCARE

Across the world, healthcare expenditure is on the rise. Particularly in Asia and Australasia,4 healthcare spending is expected to reach USD1,964.9 billion by the year 2020, a 5% increase from 2015. Globally, healthcare expenditure is expected to rise by 4.3% between the years 2015 and 2020. 5% 8,734.6

4.3% 4.3% 4.2%

4% 7,077.1 4,083.6 USD$ Billion 3,306.2 CAGR (2015-2020) CAGR 2,006.6 1,964.9 1,645.7 1,537.5 2.4% 400.5 355.7 138.9 112.7 Global North Western Asia & Latin Middle East & America Europe Australasia America Africa

2020 (P) 2015 CAGR (2015-2020) Source: World Industry Outlook, Healthcare and Pharmaceuticals. The Economic Intelligence Unit, June 2017 Source: World Industry Outlook, Healthcare and Pharmaceuticals, The Economic Intelligence Unit, June 2017 Proportion of population aged 60 years and above by country, 2015 Image 1.1: Global healthcare expenditure projections towards 2020

Percentage aged Nation 2015 2020 60CAGR years or older (USD$billion) (USD$billion) (2015-2020) Global 7,077.1 8,734.6 4.3 % 0 – 9 North America 3,306.2 4,083.6 4.3 % 10 – 19 20 – 24 4 World Industry Western Europe 1,645.7 2,006.6 4 % 25 – 29 Outlook, Asia and Australasia 1,537.5 1,964.9 5 % Healthcare and 30 or more Pharmaceuticals, Latin America 355.7 400.5 2.4 % The Economic and Middle East and Africa 112.7 138.9 4.2 % Intelligence Unit, June 2017 Proportion of population aged 60 years and above by country, 2050 projections

Percentage aged 60 years or older

0 – 9 10 – 19 20 – 24 25 – 29 30 or more

Source: World Report on Ageing and Health, World Health Organisation, 2015 Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 17

AFFORDABLE AND CONVENIENT CONNECTIVITY

The proliferation of air travel, especially budget5% airlines, have enabled more patients to travel overseas at affordable costs for medical treatment. Improving rail, air, road and maritime links mean many top-quality hospitals, doctors and services are now just 4-8 hours away from patients. 8,734.6

4.3% 4.3% 4.2% HEALTH TECHNOLOGY DEVELOPMENT AND COMPETITIVE QUALITY CARE ABROAD

Affluent patients typically explore 4%options beyond borders due to dissatisfaction with their 7,077.1 domestic healthcare system, such as the unavailability of appropriate treatments, relatively low quality of care, absence of modern technology and/or shortage of healthcare providers.5 4,083.6 USD$ Billion 3,306.2 CAGR (2015-2020) CAGR AN AGEING WORLD 2,006.6 1,964.9

It is noted that an ageing population is1,645.7 highly associated with increasing healthcare expenditure. 1,537.5 While some countries have been highly successful in catering2.4% to the medical needs of their older citizens, others have had varying rates of success. The ensuing result is many older patients 400.5 355.7 138.9

have resorted to travelling abroad to meet their medical needs. 112.7 Global North Western Asia & Latin Middle East & By 2050, one in six peopleAmerica in theEurope world willAustralasia be over Americathe age of 65Africa (16% of the total population), up from one in 11 in 20192020 (9% (P) of the2015 total population).CAGR (2015-2020) Also, by 2050, the number of people aged 80 years or overSource: isWorld projected Industry Outlook, to Healthcaretriple, from and Pharmaceuticals. 143 million The Economic in 2019 Intelligence to 426 Unit, million June 2017 in 2050.

Proportion of population aged 60 years and above by country, 2015

Percentage aged 60 years or older

0 – 9 10 – 19 20 – 24 25 – 29 30 or more

‘Region, subregion, 2019 country or area * Proportion of population aged 60 years and above by country, 2050 projections1-100 1-59 60-100 %> 60 Sub-Saharan Africa 1,066,283 1,015 801 50,482 5% Northern Africa And Western Asia 517,106 472,449 44,656 9% Central And Southern Asia 1,991,424 1,807,427 183,997 9% Eastern And South-Eastern Asia 2,334,623 1,956,262 378,361 16% Latin America And The Caribbean 648,121 566,316 Percentage81,805 aged 13% 5 https://www.who. Australia/New Zealand 29,986 23,543 60 6,443 years or older 21% int/bulletin/ Russian Federation 145,872 113,843 32,029 22% volumes/89/1/ Europe And Northern America 1,113,784 842,087 271,697 0 – 9 24% 10-076612/en/ 10 – 19 20 – 24 25 – 29 30 or more

Source: World Report on Ageing and Health, World Health Organisation, 2015 5% 8,734.6

4.3% 4.3% 4.2%

2020 (P) 2015 CAGR (2015-2020) Source: World Industry Outlook, Healthcare and Pharmaceuticals. The Economic Intelligence Unit, June 2017 Malaysia Healthcare Chronicles 2009 - 2019: 18 A 10 Year Journey of Malaysia’s Healthcare Travel Industry Proportion of population aged 60 years and above by country, 2015 CHAPTER 1

Percentage aged An Overview of the Global and Regional Healthcare Travel Landscapes 60 years or older

0 – 9 10 – 19 20 – 24 25 – 29 30 or more AN AGEING WORLD (CONT’D)

Proportion of population aged 60 years and above by country, 2050 projections

Percentage aged 60 years or older

0 – 9 10 – 19 20 – 24 25 – 29 30 or more

Source: World Report on Ageing and Health, World Health Organisation, 2015

‘Region, subregion, 2050 country or area * 1-59 60-100 %> 60 Sub-Saharan Africa 1,960,184 157,547 7% Northern Africa And Western Asia 621,699 132,348 18% Central And Southern Asia 2,029,255 467,162 19% Eastern And South-Eastern Asia 1,661,467 749,877 31% Latin America And The Caribbean 572,448 189,985 25% Australia/New Zealand 27,354 11,068 29% Russian Federation 94,330 41,495 31% Europe And Northern America 766,194 369,492 33%

Source: United Nations, Population Division, Department of Economic and Social Affairs, World Population Prospects 2019

Image 1.2: Ageing populations continue to grow towards 2050

It is reported that Asia Pacific is the world’s fastest ageing region, with a 71% increase in the number of people aged 65 years and above projected by 2030.6

Due to the lack of available treatments for their specific medical needs within their home countries or long waiting times as well as prohibitive cost, many older citizens have chosen to seek treatment abroad, which has further spurred healthcare travel demand in APAC.

6 World Economic Forum Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 19

1.1.2 Trends Within the Healthcare Travel Industry

Driven by the factors listed, the global healthcare travel industry has revealed certain trends, particularly an increase in demand for value-based treatments, growth of the travel industry, emergence of new business models and a change in response towards overall global health issues.

Value-Based Treatment Patients are increasingly moving from only looking at healthcare options in their geographical localities, to becoming more open to considering alternatives that provide the best value in terms of balancing quality and prices. Often, patients will seek the best healthcare that they can reach, both financially and from a logistics perspective. This is also influenced by another trend – the booming travel industry. Flourishing Travel The travel industry across the world is seeing significant disruptions – from air Industry travel having increased connectivity and downward pressures on prices due to higher competition, to landscape changing businesses like Airbnb making long term stay more feasible. All these contribute to making travelling for healthcare more attractive and affordable, allowing consumers to exploit healthcare pricing discrepancies in different countries and markets. New Business Models As the industry continues to evolve, and with the convergence of healthcare, technology and connectivity, new services will emerge for savvy industry participants, creating new income streams and opportunities. Examples include an increase in the number of health facilitators coming into the sector to facilitate the patient experience, to technology players looking at providing holistic support for patients crossing borders, and healthcare systems and travel players tacking on healthcare travel offerings as a value-add. Future of Health, The mindset around health and wellness has shifted, with people and governments Wellness, and Wellbeing moving from curative healthcare to preventive healthcare. Aside from wearables and technology that have become hallmarks for a more health conscious demographic, there is an increasing demand in anti-ageing treatments, aesthetics, and other similar procedures that help extend and improve the quality of life. The search for such treatments is supporting an increase in healthcare travel, addressing the inequalities of healthcare provision and technological advancements in different regions and countries.

The aforementioned trends have cumulatively led to higher expectations and an increased demand of healthcare.

The situation is indeed challenging for governments and private healthcare providers as with more sophisticated healthcare services, there is a greater requirement for technology, equipment, more qualified healthcare professionals and ultimately rising costs. PROFILE 1 PROFILE 2 Originate from developed countries with sufficient Inadequate local healthcare (including private local healthcare systems, but has difficulties healthcare) in terms of: accessing their local healthcare system. Challenges faced include:

Unavailability to treat certain Long waiting times (especially for conditions conditions deemed non-life threatening) Lack of medical facilities or equipment Shrinking or lack of coverage, especially for services like dental Long waiting times and cosmetic surgery Malaysia Healthcare Chronicles 2009 - 2019: 20 A 10 Year Journey of Malaysia’s Healthcare TravelLack ofIndustry trained doctors, especially Expensive private healthcare and specialists complex insurance coverage with

CHAPTER 1 MOTIVATION huge ‘out-of-pocket’ portions. Poor service quality (i.e. lack of patient empathy and patient care)

An Overview of the Global Lackand of Regional confidence in Healthcare their own Travel Landscapes healthcare system.

PO PU LA N T IO IO T Financial Demographics N A T • Government spending • Ageing population H N • Health reform • Chronic disease E E A • Alternative financial/ • Communicable disease L M T G business models • Access to healthcare H A • Public/private • Consumer engagement / R V F partnerships O E L U D M

Operational L Innovation

• Infrastructure U • Medical advances E • Waste • Digital connected • Alternative care health delivery/ operational • Data/analytics models COST • Talent

Regulatory • Patient and product safety • Cybersecurity • Fraud and abuse

E FF E EC AR TIV E C E, E BL FFICIENT, EQUITA

Source: Harvard Business Review

Image 1.3: Greater demand for healthcare equates to higher costs

Governments are now coming under increasing pressure (more so if healthcare is public funded or subsidised) on how to develop sustainable models that allow for the provision of an advanced healthcare system and modern infrastructure with highly trained professionals while keeping costs affordable. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 21

1.2 GLOBAL HEALTHCARE TRAVEL: KEY INSIGHTS

Given the many growth factors and trends supporting the rise of healthcare travel, the industry has continued to see robust growth, notably in recent years. Global average compounded annual growth rate (“CAGR”) for the past 5 years has been 10%-12%,7 with a 4% year-on-year growth. On the back of this healthy growth, in terms of revenue, global healthcare travel‘s current receipts are estimated to be at USD16 billion8 and is expected to reach USD20 billion by 2022.9 It is important to note that the global healthcare travel industry revenue estimate and forecast could be a few folds more if wellness, pre- and post- medical segments as well as the spillover to other industries are added to these numbers.

2022 USD20 Billion

2018 USD16 Billion

Source: International Medical Travel Journal (“IMTJ”)

Image 1.4: Global healthcare travel industry growth projection

Note: Market revenue estimate and forecast based on medical receipts of healthcare travellers, excluding wellness component of the healthcare travel journey.

7 World Tourism Organization (UNWTO) 8 IMTJ and Euromonitor estimated the global medical tourist revenue in 2018 to be at USD16 billion. This is pure hospital receipts, excluding wellness. The industry players believe that if the revenue from wellness and other supportive services such as hotel, logistics, shopping, leisure and meals are included, the industry's revenue may reach USD180 billion. 9 Euromonitor

2022 USD9.5 Billion 2018 USD4 Billion 2022 USD20 Billion Malaysia Healthcare Chronicles 2009 - 2019: 22 A 10 Year Journey of Malaysia’s Healthcare Travel Industry 2018 CHAPTER 1 USD16 Billion An Overview of the Global and Regional Healthcare Travel Landscapes

1.3 REGIONAL HEALTHCARE TRAVEL: KEY INSIGHTS

Over the past decade, Asia and specifically Asia Pacific (“APAC”) has emerged as one of the fastest growing healthcare travel regions in the world – receiving some of the highest numbers of revenue receipts and healthcare travellers.10 Malaysia, India, Thailand, Taiwan, South Korea and Singapore emerged as among the top 10 healthcare travel destinations in the world.

2022 USD9.5 Billion 2018 USD4 Billion

Source: International Medical Travel Journal (“IMTJ”)

Image 1.5: Regional healthcare travel industry (APAC) growth projection

Note: Market revenue estimate and forecast based on medical receipt of healthcare travellers, excluding wellness component of the healthcare travel journey.

With six out of the top 10 healthcare travel hotspots based in APAC, the region takes approximately 25% of the estimated global healthcare travel revenue. APAC’s healthcare travel market share is estimated to be around USD4 billion based on the global estimate by the International Medical Travel Journal (“IMTJ”). This number is projected to grow to USD9.5 billion by 2022 with a CAGR of 12%-14% during that period.11 Again, it is important to note that the regional healthcare travel industry revenue estimate and forecast could be a few folds more if wellness, pre- and post- medical segments as well as the spillover to other industries are added to these numbers.

10 https://www.thenational.ae/lifestyle/travel/five-star-treatment-top-10-destinations-for-medical-tourism-1.679880 11 https://www.theedgemarkets.com/article/malaysia-projects-rm18-bil-hospital-revenue-healthcare-travellers-2019, http://www.thailandtoday. in.th/news-update/hospitality/1904, https://www.stb.gov.sg/content/stb/en/media-centre/media-releases/third-consecutive-year-of-growth- for-singapore%20tourism-sector-in-2018.html” https://www.stb.gov.sg/content/stb/en/media-centre/media-releases/third-consecutive-year- of-growth-for-singapore tourism-sector-in-2018.html and https://www.imtj.com/news/south-korea-grows-its-medical-tourism-business/ Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 23

SOUTH KOREA US$806.2 mil 321,574 (2017)

DUBAI (UAE) US$390 mil INDIA 326,649 US$3 bil (2016) 495,000 THAILAND (2017) US$1.4 bil 2.4 mil (2017)

MALAYSIA US$360 million 1.5 billion (2018) SINGAPORE US$78.42 million Unreported (2018)

Note: Figures are published data and definition for medical tourism data varies for each country.

Source: MHTC, Frost & Sullivan Image 1.6: APAC healthcare travel landscape performance

Country Healthcare Travel Revenue and Volume India US$3 billion 495, 000 (2017) South Korea US$806.2 million 321, 574 (2017) Thailand US$1.4 billion 3,500 2.4 million (2017) Malaysia US$360 million 1.5 billion (2018) Singapore US$78.42 million Unreported (2018) Dubai (UAE) US$390 million 326,649 (2016)

Source: Oanda currency converter as of December 2014 – 0.75554 US Dollars (million) US Dollars 655 600 600 575 450 350 350 350 315 7. UK 6. India 10. Iran 3. Turkey 9. Mexico 5.Germany 4. Thailand 8. MALAYSIA 2. South Korea 1. United States 1. United

Source: IMTJ research, LaingBuisson’s Medical Travel and Tourism Global Market Report Malaysia Healthcare Chronicles 2009 - 2019: 24 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 1

An Overview of the Global and Regional Healthcare Travel Landscapes

1.4 LEVERAGING ON PLAYERS WITHIN THE APAC REGION

While Malaysia has certainly made significant strides to position itself as a credible player on the regional stage, Malaysia remains in stiff and increasing competition with various countries across Southeast Asia and beyond for a slice of the lucrative growing healthcare travel market pie.

Understanding and penetrating the multifaceted healthcare travel industry requires detailed study and observation. Malaysia has had the privilege to learn much from players within the APAC region who have had a leg up in the race much earlier on.

1.4.1 Profile, Policies, Focus Markets and Initiatives of Other Regional Players

The following analysis illustrates the various strengths and advantages of regional players and their strategies in developing their respective healthcare travel sectors.

Focus Country HT Revenue HT Volume Growth Top Treatments HT Initiatives Markets Thailand US$1.4 Healthcare Revenue Cambodia • Cosmetic Government-led programmes to facilitate billion Tourist - increased Laos surgery healthcare travel growth towards evolving the (2018) 350,000 3-4% year- Myanmar sector into a medical and wellness tourist on-year Vietnam • Cosmetic destination and world-class medical hub. Health and (CLMV) Dentistry wellness China a) Visa Extension for CLMV and China tourist - Japan • Lasik surgery medical tourists up to 90 days. 2 million Middle East • Other major b) Smart visa for highly skilled professionals. (2018) Europe surgeries c) Long-stay visa known as Thai Elite Visa – 20 year visa for business and pleasure purposes.

d) G2G collaborations with UAE, Kuwait and Scandinavian countries.

e) A special privilege programme for senior citizens and eligible persons of Europe and Japan. Source: IMTJ, Kasikorn Research, MHTC Analysis Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 25

Focus Country HT Revenue HT Volume Growth Top Treatments HT Initiatives Markets South US$806.2 Healthcare Revenue China • Cosmetic Target Market Expansion Korea million Tourist - fell 26%, CIS surgery (2017) 365,000 and countries a) Beyond China, the government expands numbers (Russian • Cancer marketing activities to attract other (2018) decreased speaking) treatment Chinese-speaking countries i.e. Taiwan 12% from UAE and Hong Kong. 2017 • Minor surgeries b) Stronger focus on Southeast Asian countries i.e. Vietnam, Indonesia. • Dental Geographical Based Strategies

• Eye care a) Capitalising on airline connectivity to target specific cities within East • Medical Asia, i.e. Jeju and Busan to target check-ups Japan, which has daily direct flights via the creation of specially developed healthcare travel packages

Enhancing Comfort and Familiarity Factor

a) To cater to increased demand from Vietnam travellers, many clinics in Seoul now provide Vietnamese translators, Vietnamese food (sourced from local eateries) and even Vietnamese pop songs with K-pop in waiting rooms

b) Facilitating / Ancillary Strategies to complete / enhance the overall customer / patient experience

c) Medical tour agencies

Success Story Profiling

a) Utilising Word-of-Mouth (“WOM”) from patients who have successfully done plastic surgeries as well as from personal recommendations via social media. Source: IMTJ, Chosun Media, Jingtravel.com Malaysia Healthcare Chronicles 2009 - 2019: 26 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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An Overview of the Global and Regional Healthcare Travel Landscapes

Focus Country HT Revenue HT Volume Growth Top Treatments HT Initiatives Markets Singapore US$78.42 Healthcare Exact Indonesia Mostly for high- Healthcare travel is no longer a national million Tourist - figures Malaysia end specialty agenda for Singapore. The government has (2018 50,000 unknown; China care: taken a step back while the private sector is estimated) but • Cardiology at the helm of driving the industry. (2018) believed • Neurology to be • Diagnostic a) With healthcare travel primarily driven declining. Treatments by the private sector, Singapore’s private healthcare sector continues to invest and expand abroad.

b) Key players have established medical facilities in Hong Kong, Japan, Vietnam and Cambodia.

Market Diversification

a) Singapore continues to attract healthcare travellers from less ventured markets i.e. Myanmar, Cambodia, Vietnam, Bangladesh, India and China.

Establishing Strategic Partnerships and Strengthening Existing Networks

a) Strengthens network with Bangladesh with a knowledge-sharing Continuing Medical Education (CME) talk with 18 Bangladeshi doctors.

Showcases Medical Innovation

a) Continues to undertake ground-breaking procedures and initiatives i.e. first hospital in Southeast Asia to perform High Intensity Focused Ultrasound (“HIFU”) treatment for Uterine Fibroid

Supported by Singapore Tourism Board (“STB”)

a) Singapore Tourism focuses on strengthening its 3rd largest source market - India.

b) STB inks strategic partnership with India’s largest leading payment gateway - Paytm.

c) STB focuses on India’s second-tier cities to boost tourism revenues.

d) Promoting ‘Passion Made Possible’ - a Leisure and Business Destination branding promoting specific tourism trips targeted at returning visitors. Source: Raffles Medical Group, Parkway Pantai, Fisher & Paykel Healthcare, Times of India Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 27

1.5 MALAYSIA’S CONTINUED RISE IN HEALTHCARE TRAVEL

Malaysia Healthcare’s favourable performance over the years is a result of careful and strategic planning over the past decade. Approaches taken by MHTC to grow the industry can be broken down into two phases: Phase I (2011- 2014) and Phase II (2015 – 2018).

PHASEPHASE I I PHASEPHASE II II (2011(2011 – 2014)– 2014) (2015(2015 – 2018)– 2018)

• • Extensive Extensive marketing marketing campaign campaign • • Marketing Marketing focus focus shifted shifted to to andand effort effort to tobrand brand Malaysia Malaysia higherhigher margin margin market market GrowingGrowing the the Market Market HealthcareHealthcare segmentsegment and and treatments treatments ShareShare and and Creating Creating • G2G and B2B alliances to • Targeted alliances with higher StrongerStronger Brand Brand • G2G and B2B alliances to • Targeted alliances with higher securesecure patient patient load load in intarget target marginmargin market market PresencePresence marketsmarkets

• • Build Build adequate adequate healthcare healthcare • • Build Build adequate adequate healthcare healthcare infrastructureinfrastructure and and human human infrastructureinfrastructure and and human human BuildingBuilding Service Service capitalcapital capitalcapital CapacityCapacity • • Enhance Enhance end-to-end end-to-end patient patient • • Enhance Enhance end-to-end end-to-end patient patient carecare experience experience carecare experience experience

Image 1.7: Transformation roadmap for Malaysia Healthcare

CoordinateCoordinate marketing marketing events events by by leveraging leveraging on on stakeholders’ stakeholders’ events events with with standardised standardised andand consistent consistent messaging messaging which which is iscustomised customised to totarget target audience audience

EnsureEnsure every every information information touchpoint touchpoint delivers delivers accurate accurate and and timely timely guidance guidance on on MalaysiaMalaysia Healthcare Healthcare

UseUse informatics/analytics informatics/analytics to tosupport support marketing marketing strategies strategies effectively effectively

IncreaseIncrease brand brand awareness awareness through through participation participation in inmajor major international international conferences conferences

EnableEnable more more effective effective marketing marketing and and promotion promotion of ofMalaysia Malaysia Healthcare Healthcare through through supportivesupportive regulatory regulatory frameworks frameworks

Image 1.8: Five things Malaysia Healthcare did differently in Phase II Malaysia Healthcare Chronicles 2009 - 2019: 28 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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An Overview of the Global and Regional Healthcare Travel Landscapes

1.5.1 Malaysia Healthcare: Successes and Achievements

Malaysia has emerged as one of the top performing countries within the APAC region. The Global Market Report 2018 places Malaysia as the world’s top healthcare travel destination by volume. 900,000 500,000 365,000 350,000 350,000 300,000 300,000 255,000 250,000 Healthcare Traveller Volume Volume Traveller Healthcare 200,000 155,000 150,000 150,000 100,000 100,000 70,000 50,000 50,000 50,000 50,000 47,500 35,000 35,000 UK USA Spain Dubai Japan Turkey Taiwan Jordan Mexico Poland Belarus Vietnam Belgium Hungary Bulgaria Thailand Germany Singapore MALAYSIA Hong Kong Switzerland South Africa South Korea Source: Medical Tourism Facts and Figures 2018, International Medical Travel Journal (“IMTJ”)

Image 1.9: Top Global Medical Tourism Destinations, 2018

Note: The graph above shows the number of healthcare travellers who have entered the country for medical reasons only, excluding wellness segment. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 29

Equally noteworthy is Malaysia’s emergence as a top 10 wellness destination. Malaysia’s ranking of eight outpaces many other famous locations and clearly affirms the country’s unique ability to attract travellers from around the world.

Malaysia is in the Top 10 Wellness Tourism Markets in APAC

70.2

56.0 $31,705.9

40.5 $16,299.7

19.6 (millions) Number of Trips $22,466.1 $6,928.5 Receipts/Expenditures (US$ Millions) Receipts/Expenditures $12,018.4 $4,001.1 $5,019.2 $10,520.9

9.6 $3,036.0 12.5 8.3 10.0 3.0 8.3 $7,186.6 India China Japan Vietnam Thailand Australia Indonesia MALAYSIA South Korea New Zealand New

Receipts/Expenditures (US$ Millions) Number of Trips (millions)

Source: Global Wellness Institute Source: Global Wellness Institute

Image 1.10: Top ten wellness tourism markets in Asia-Pacific 1,445 1,274 1,123 1,206,800 880,700 881,800 859,200 1,049,600 728,100 921,500 914 643,100 777 HT Volume 726 HT Revenue (RM Mil) HT Revenue 603 527

2011 2012 2013 2014 2015 2016 2017 2018

HT Vol HT REV Source: MHTC Informatics Malaysia Healthcare Chronicles 2009 - 2019: 30 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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An Overview of the Global and Regional Healthcare Travel Landscapes

Testament to Malaysia’s rise as a leading healthcare travel destination is the many accolades awarded to the country at the international stage and the country’s continued upward ranking movement in recent years. (For full list of Awards and Accolades received by Malaysia Healthcare, please refer to Chapter 4).

Malaysia has been Malaysia also internationally recognised as received the

from 2015 to 2019 award for healthcare travel from 2015 by US-based to 2017 and with a highly commended International Living magazine mention in 2018 by the UK-based International Medical Travel Journal

About About

International Living (IL) is a US based monthly The International Medical Travel Journal (IMTJ) publication for subscribers detailing the best was established in 2007 with a focus on healthcare places in the world to live, retire, travel and invest. travel. It embraces many of the themes that Founded in 1979 by Bill Bonner, IL now has offices challenge healthcare providers across the world - and writers located all over the world. insurance, accreditation, marketing and promotion, quality, patient safety, levels of care and experience Taking a different approach, IL produces articles in treating international patients. through writers who have experienced for themselves places around the world that are IMTJ is independent of the associations and cheaper, healthier and safer to live in. special interest groups that have come aboard the healthcare travel bandwagon. IMTJ is currently International Living magazine is quoted as one of under the purview of LaingBuisson International the best resources for people who are serious about Limited. moving overseas. In each issue, they bring in-depth coverage of the world’s top retirement havens, show ways you can earn a living overseas, travel well, slash your cost of living and increase overall quality of life. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 31

Malaysia remains a go-to case study of how countries can and should develop their healthcare travel sector to serve healthcare travellers.

IMTJ Croatia

UNWTO Budapest Medical Korea Seongnam International Medical Tourism Convention Korea

IMTJ USA IMTJ London IMTC Jordan

Image 1.11: Malaysia as a Case-Study for Others WHAT IS THE STRENGTH OF MALAYSIA HEALTHCARE? “Beyond cost, accessibility and world-class quality, the Malaysia Healthcare brand is built on strong trust. Patients from around the world know that they can expect the best in healthcare services, treatment and infrastructure.’’

YBHG DATO’ DR. JACOB THOMAS Chairman of the Board of Directors, Ramsay Sime Darby Health Care (RSDHC) Group Immediate Past President, Association of Private Hospitals of Malaysia

Malaysia Healthcare Chronicles 2009 - 2019: 34 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2: Malaysia Healthcare: Asia’s Best Kept Secret

2.1 History of the Industry 2.2 Malaysia Healthcare Travel Council 2.3 Malaysia: A Unique Healthcare Destination for All Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 35

2.1 History of the Industry

2.1.1 History of Malaysia’s Healthcare System

Prior to colonisation, dwellers on the land that is now known as Malaysia practised traditional medicine to treat ailments and illnesses. With the arrival of colonisers from the West, a Western medicine culture was introduced to the country and the first hospital, situated in Taiping, was built in 1880. Along with that, the first ever medical school was built in Melaka in 1941, cementing the beginning of a thriving healthcare system.

Upon attaining Independence in 1957, 10 major public hospitals and 56 district hospitals were established throughout the nation. For the decade or so, the local Malaysian community was mainly served by the public sector and non-profit hospitals. As the nation’s economy grew and urbanisation proliferated in the 1970s, the private healthcare sector began to flourish as a primary care provider.

With the increase of public and private healthcare facilities over the next few decades, Malaysia saw much growth in medical treatment expertise, recording a string of accomplishments which has set us as the benchmark within the Asian region (see page 92-97).

In 1996, the Malaysian healthcare system achieved the capacity to provide healthcare services for 93% of the country’s population within a 5-kilometre radius. The following year, the Malaysian Society for Quality in Health (“MSQH”) was established.

About MSQH

The Malaysian Society for Quality in Health (“MSQH”) is a non-governmental and not for profit organisation established in 1997. It is the brainchild of the Ministry of Health (“MoH”) in partnership with the Association of Private Hospitals Malaysia (“APHM”) and Malaysian Medical Association (“MMA”).

MSQH is recognised nationally and internationally as the leading Malaysian organization which promotes and improves safety and quality in the provision of healthcare services in Malaysia. MSQH also plays a role in regulating the private healthcare facilities.

The MSQH Hospital Accreditation Standards is accredited by International Society for Quality in Healthcare (“ISQua”).

As of February 2019, there are 57/200* private hospitals and 72/144* public hospitals which have achieved MSQH accreditation.

Source: MSQH website 3/9/2019, *Health Facts 2018 (reference data for 2017)

Membership in Committees MSQH have been actively involved in the following national committees: • Patient Safety Council of Malaysia since 2003 • Malaysian Productivity Corporation since 2002 • Malaysia Healthcare Travel Council since 2007 • MPC Consultative Panel for Healthcare • Ministry of Health 10th Malaysia Plan Technical Working Group Malaysia Healthcare Chronicles 2009 - 2019: 36 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

In 1998, the Private Healthcare Facilities and Services Act was established with the Fee Schedule 13 placed in effect to cap pricing of professional fees. Amidst more medical breakthroughs, the next few decades saw the development of Malaysia’s dual healthcare system to meet the needs of the locals while serving quite a number of healthcare travellers.

In 2010, the 10th Malaysia Plan was introduced, followed by the 11th Malaysia Plan in 2015 which detailed how Malaysia’s healthcare system was to be improved upon.

Alongside these plans, the healthcare travel industry was recognised as a key export services industry growth to drive the nation to new heights (Please refer to Section 2.1.4).

Now and Beyond

2016-2020 11th Malaysia Plan.

2014 2013 2012 2011-2015 1998

1:633 Doctor pop ratio Traditional and Medical Device Act 2012 Country Health Plan. Private Healthcare 1:333 Nurse pop ratio Complementary 10th Malaysia Plan. Facilities and Services 141 public hospitals Medicine Act 2013 Act 1998-13th Fee 268 private hospitals & Schedule. ACC - Ambulatory Care Centres

1957 National Health System 1970 1996 1997

Post Independence Healthcare was Urbanise caused 93% of population Era. primarily provided by private healthcare lived within 5km of a 10 major public the public sector and growth. healthcare facility. hospitals and 56 non-profit hospitals. Primary care by district hospitals. private sector.

1941 1880 Colonial era Traditional remedies Pre-Colonial Era

First medical school Western medical Indigenous medical started in Melaka. practice. beliefs and practices. First hospital built.

Image 2.1 : Development of Malaysia’s healthcare system Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 37

2.1.2 Healthcare Travel in Malaysia

Malaysia’s healthcare travel industry has an extensive history which began in a number of states in Malaysia since the mid-1990s. The healthcare travel industry grew organically in several states - particularly in Penang and Melaka.

Understanding that their local demand was limited, these hospitals sought to diversify their base by addressing the needs of Indonesian patients proximate to them.

As the local healthcare travel industry grew organically, the Penang Health Association (“PHA”) was formed in 2006, and the Penang Centre of Medical Tourism (“PMED”) was established in 2015 to promote Penang’s local healthcare travel industry. The task force has seen to the needs of growing the local healthcare travel industry.

Excellent Professional A Bona Fide Hospitals Collaborate Key Export Services Care on Par with the Tourist Haven and Industry Growth World’s Best Strive for Success

The high quality of The states' allure is Setting a global best Continuing to set the pace treatment and care strengthened by its practice, Penang has for others to emulate, provided across Penang natural appeal as a benefitted from the Penang and Melaka's and Melaka's healthcare holiday and retirement strong hospital alliance healthcare travel sector industry has led to the destination. established within the aims to further boost state benefitting from state. The alliance capacity and capability repeat patients who return Its colonial charm, unique encourages collaboration towards maintaining its to the respective states for tourist sights, among private hospitals record of accomplishment follow-up procedures or world-renowned street via the aforementioned as a shining light for further treatments. These food and gourmet fare, PHA and PMED. Malaysia Healthcare. include post-operational old-world history and care, physiotherapy and heritage (Penang’s capital Private hospitals others. Penang and Melaka city, Georgetown, and independently organise are widely regarded as Melaka City have both roadshows and trade cost-effective locations for been designated as missions to promote their post-treatment UNESCO World Heritage services and expand recuperation. sites) have helped the Penang island as a whole states attract medical in their quest to expand tourists, who before or their international As a result, patients tend after treatment, can take network. to take extended stays in in the many attractions the state, which generates and enjoy an affordable increased revenue for the and pleasurable travel healthcare travel industry experience. as well as for the supporting sectors such as hospitality, retail, banks and others.

Image 2.2 : Healthcare Travel in Malaysia Malaysia Healthcare Chronicles 2009 - 2019: 38 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

Learning from the success of these states, Malaysia’s healthcare travel industry was pursued with determination to profile the country as a preferred destination for healthcare in different parts of the country, thanks to excess capacity and favourable currency exchange rates.

The focus on healthcare travel includes not only medical treatment and services, but also wellness, an important component in the overall value proposition mix to attract patients to Malaysia.

A significant policy decision was made when the government made a clear delineation that only the private medical sector would be used to tap the healthcare travel market, while the public medical stream would remain solely for serving its people, ‘the Rakyat’.

The government began roping in private sector players and soon joint efforts were made to participate in international healthcare events and other outreach efforts to tap the growing international market. At the time, efforts to promote Malaysia’s fledgling healthcare travel sector came under the purview of various government ministries and agencies as well as efforts by private sector hospitals.

In ensuring a more collective and effective effort, the Ministry of Health consolidated the strengths of leading Malaysian private healthcare providers, and relevant government agencies such as Malaysian Investment Development Authority (“MIDA”), Malaysia External Trade Development Corporation (“MATRADE”) and Tourism Malaysia. Beyond ensuring economies of scale, the consolidation would drive more streamlined and strategic initiatives in developing and marketing the growing Malaysia Healthcare brand to the world.

As the representative of Malaysia’s private medical sector, the Association of Private Hospitals Malaysia (“APHM”) collaborated with the government and encouraged its members to tap the healthcare travel market. APHM was also mandated to assist private hospitals to attain quality accreditation to develop stronger trust perceptions among foreign patients. The focus on quality has led to the birth of MSQH.

Progressively, the effective public-private sector working relationship was cemented and Malaysia Healthcare began to develop as a recognisable brand and accepted hallmark of high-quality medical care.

Over the years, through a wide range of international branding and marketing efforts, Malaysia Healthcare was brought to all corners of the world, including Korea, Russia and the UK.

2.1.3 The Need for a Single Body and the Creation of MHTC

As Malaysia’s healthcare travel industry developed, clearly, there was a rising need to establish a dedicated entity to look into industry promotion and to address various issues and gaps in the value chain. The new entity or unit would serve to further strengthen relationships between the government and the private sector while looking at ways and means to drive industry growth and international branding.

In 2003, a small unit under the Corporate Division of the Ministry of Health was established which included knowledgeable experts in healthcare to advise and guide the Ministry of International Trade and Industry (“MITI”) and MATRADE representatives in showcasing Malaysia’s healthcare travel industry. This unit grew into the “Health Services” unit under the Corporate Services Division, forming a microcosm of what is known as MHTC today. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 39

By 2005, a decision was made to turn the Health Services unit into a department and in 2009, the unit was named Malaysia Healthcare Travel Council, better known as MHTC. As the role of MHTC grew, the unit required more resources and empowerment to drive the industry forward.

MHTC was corporatised under the National Key Economic Area (“NKEA”) in 2011 with an aim to enable the agency to fulfil its role as the promoting and facilitating arm of the Ministry of Health. Hence, Malaysia Healthcare was birthed as the brand we know and recognise today.

2.1.4 A Place in the Economy’s Blueprint

The emphasis on healthcare travel as a sector for economic growth was factored in the Economic Transformation Programme (“ETP”) which was launched in 2010. ETP represents one component of the National Transformation Programme (“NTP”), designed to elevate Malaysia towards high-income status and it earmarked healthcare as one of the country’s 12 NKEA. Healthcare travel was identified as one of the six entry point projects (“EPPs”) for the Healthcare NKEA, intended to harness the healthcare travel industry’s economic potential under the EPP4: Reinvigorating Health Travel. The corporatised national promotional body MHTC assumed the responsibility as the primary agency to develop the industry and promote Malaysia as a healthcare travel destination.

In the Tenth Malaysia Plan (“RMK10”) 2011-2015, focus was given to the development of subsectors and industries that have potential to generate high-income jobs and have strong linkages with the rest of the economy. During the RMK10, healthcare travel was identified as one of the areas of focus to transform the services sector, and the target is to grow the revenue from healthcare travel and make Malaysia the preferred healthcare destination in the region. Key strategies that were looked at to achieve the target include:

• Fostering strategic alliances among local and foreign healthcare service providers, travel organisations and medical insurance groups to provide a more integrated and comprehensive package of services to healthcare travellers; • Encouraging more private hospitals to seek accreditation with international healthcare accreditation bodies; • Promoting investment in and utilisation of high-end medical technology to increase efficiency, effectiveness and competitiveness; and • Intensifying coordinated and integrated promotional activities to strengthen the presence of Malaysia Healthcare brand globally.

In the Eleventh Malaysia Plan (“RMK11”) 2016-2020, healthcare travel continues to be one of the primary drivers for economic growth. The strategies were formulated to unlock the potential of the sector further. Greater focus was given to the internationalisation of service providers in private healthcare improving their external competitiveness to capture greater export opportunities through healthcare travel. The target was to increase the share of services exports value added from 12% in 2010 to 19% in 2020. Meanwhile, the healthcare travel subsector is expected to record an annual growth rate of 15% and generate about MYR2 billion in revenue by 2020. Malaysia Healthcare Chronicles 2009 - 2019: 40 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

The strategy canvas for Private Healthcare is as shown below, which outlines the initiatives that will facilitate the growth of the healthcare travel subsector.

Strategy Canvas for Private Healthcare

High

As-Is Eleventh Plan

Low Eliminate Reduce Raise Create

Ineffective Capacity of private Ease of visa International regulations hospitals requirements for insurance foreign patients portability

Dependence on imported Promotion of Number of internationally T&CM centre traditional complementary domestic T&CM acredited private of excellence medicine (T&CM) hospitals

Source: Eleventh Malaysia Plan

Image 2.3: Strategy canvas for private healthcare

2.2 Malaysia Healthcare Travel Council

As a dedicated agency working to promote Malaysia as an international healthcare destination, MHTC presently resides under the Ministry of Finance, Malaysia. MHTC’s mandate is to promote Malaysia Healthcare around the world, as well as facilitate public-private sector collaborations, to effectively address issues affecting the industry.

MHTC also serves as a one-stop centre for the MISSION VISION healthcare travel industry: for the promotion, business development, facilitation, networking, Promoting Malaysia Malaysia as the regulation and centre to handle all enquiries on Healthcare globally leading global healthcare travel in Malaysia. and facilitating healthcare the industry destination sustainability

MHTC CALL CENTRE The establishment of the MHTC call centre enables prospective healthcare travellers to make enquiries, and seek further information or clarification to empower them to make the most informed decision on their choice of medical care providers, types of treatments available, suitable locations and more.

MALAYSIA HEALTHCARE CONCIERGE AND LOUNGE ("MCL") The MCL provides a one-stop centre for patients to refer to upon their arrival in Malaysia. Services provided include assistance with Immigration and Customs, baggage claims, a halal lounge, a meet and greet service and other related patient services. The concierge provides assistance and facilitates the patient's journey in what could potentially be unfamiliar surroundings, further smoothening the process for them.

eVISA (MEDICAL) MHTC has worked together with the Immigration Department of Malaysia to develop the issuance of electronic visas or eVISA (Medical) for inbound healthcare travellers. The creation of the innovative system enables a faster and more convenient process for visa applications and approvals.

In fulfilling the mandate given by the Government, MHTC endeavoured to grow the industry in a sustainable manner.

Gap Analysis

Gaps along the healthcare travel value chain were identified as per below, and subsequently, strategies were devised to address them accordingly:

GAP STRATEGY

Lack of awareness of Malaysia’s healthcare value proposition Lack of Amplifying • Malaysia is known as a travel destination but there is Branding and awareness little awareness on the quality of our healthcare Recognition offering

Gaps in end-to-end patient experience Strengthen Gaps in • Malaysia has a host of high-quality, affordable private End-to-End Value end-to-end healthcare providers but is still lacking in providing a Chain seamless customer experience

Poor network and relationships in focus regions, Poor network resulting in little to no advocacy Enhance Network and • Hampers our ability to reach on-ground audience and Relationship relationships effectively and consistently

Image 2.4: Gap analysis and strategies for Malaysia Healthcare

Each strategy created is supported by three core pillars: Facilitation, Digital Marketing and Industry Sustainability. These pillars underpin a wide range of activities which are further detailed in Chapter 3.

Supply-Demand Studies

Over the course of the past five years, MHTC embarked upon several supply-demand studies of various purposes:

• Consumer Behaviour Studies: To understand the demand for healthcare travel in specific targeted markets • Brand Health and Loyalty Study: To set the baseline for future measurement of brand health and campaign impacts • Supply-Side Studies: o Service Capacity: To understand the capacity required for us to achieve our goals o Stakeholder Perception: To determine how MHTC can further add-value to the services provided to stakeholders Malaysia Healthcare Chronicles 2009 - 2019: 42 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

Project Initiated Consumer Behaviour Study – China and Hong Kong 2015 Consumer Behaviour Study – Vietnam 2015 Consumer Behaviour Study – Australia 2015 Feasibility Study – Identifying Opportunities to Brand Malaysia as a Destination of Choice for UK 2016 Healthcare Tourists Service Capacity Study 2016 Consumer Behaviour Study – Indonesia 2017 Brand Health and Loyalty Study 2017 Stakeholder Perception Study 2018 Consumer Behaviour Study – India 2018

Outcome of Studies

• Consumer Behaviour Studies have reaped insights into the unique behaviour of healthcare travellers across several target markets in the region. These studies revealed the receptiveness of overseas medical and healthcare treatment; comparing Malaysia against other competitors. Information such as key influencing factors, usage and attitude that affect healthcare travellers’ decision to seek medical treatment abroad highlighted in these studies showed some “gaps” and growth opportunities for Malaysia to focus on. This information has assisted in the development of marketing strategies to expand Malaysia Healthcare into the target market.

• Brand Health and Loyalty Study provided information on the overall brand perception of Malaysia Healthcare, brand performance across its touchpoints as well as brand loyalty in several target markets as well. The information revealed Malaysia Healthcare brand strength across the value chain and helped with better brand positioning in the target markets. The insights also revealed the impact of marketing initiatives on brand equity in the target markets and helped to re-visit some of the marketing strategies for better reach to healthcare travellers.

• Services Capacity Study evaluated national capability to support the growing demand of healthcare travel. The study provided an overview of service capacity by therapeutic segments and by states in Malaysia, and modelled out initiatives based on their expected impact and feasibility for implementation. These insights helped in the modelling and prioritisation of initiatives to build competitive capabilities in Malaysia.

A Snapshot of Malaysia Healthcare’s Initiatives

The dedicated healthcare travel council also functions as a focal point for all matters related to healthcare travel, from assisting health travellers with inquiries, to facilitating enquiries on policies and programmes related to healthcare travel development and promotion, including solutions on matters related to healthcare travel.

MALAYSIA HEALTHCARE REPRESENTATIVE OFFICES AND LOCALISED OUTREACH Representative offices in Vietnam, Myanmar and Indonesia further entrench the Malaysia Healthcare brand among prospective medical travellers in these countries, supported by localised social media campaigns and microsites. MHTC CALL CENTRE The establishment of the MHTC call centre enables prospective healthcareMalaysia travellers Healthcare to make Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 43 enquiries, and seek further information or clarification to empower them to make the most informed decision on their choice of medical care providers, types of treatments available, suitable locations and more.

Image 2.5: MHTC initiatives to enhance the seamless end-to-end healthcare journey experience

2.3 Malaysia: A Unique Healthcare Destination for All

Despite being a relatively late entrant to the healthcare travel market and facing plenty of regional competition, the Malaysia Healthcare brand continues to grow from strength to strength and pleasingly today, has become a serious regional contender.

Certainly, the growth and progress of the industry is to a large extent, attributed to the proposition of world-class quality, ease of accessibility and comparative affordability.

However, Malaysia Healthcare’s attractiveness is also accentuated by other factors. These include the nation’s strategic position as a Muslim friendly nation, its many travel sights, a multilingual healthcare system that is able to cater to the language preferences of patients across Asia and the world.

World-Class Quality Affordability Ease of Accessibility Global Halal Hub Tourist haven

Quality and safety MoH regulates ceiling Virtually no waiting Malaysian society is Malaysia is standards in Malaysian rates for healthcare times for appointments, largely Muslim-friendly. strategically situated private hospitals are treatments, ensuring consultations and All hospitals serve only on international travel exemplary, services remain treatments with halal menus and routes and is benchmarked against realistically affordable. specialists, allowing provide prayer facilities. well-connected to all the world's best, and are This is according to the real-time access. major travel hubs from closely monitored and MoH Medical Fee Availability of around the world. stringently regulated by Schedule 13 of the Malaysia houses over porcine-free medical MoH. PHFS Act 1998 that has 200 private hospitals, products, such as Malaysia is home to been set up by the MoH. not including dental sutures and vaccines. over 30 million people Malaysian private clinics and health and of various ethnic hospitals have been Cost of treatment is wellness centres. Many medical backgrounds, diverse accredited by recognised affordable compared to professionals and culture, with a myriad bodies: MSQH, Joint countries within the Connected by direct personnel, both men of popular tourist Commission region thanks to flights to major travel and women, are destination spots. International ("JCI"), capping of charges. hubs across the world. Muslims. Reproductive Technology Accreditation Committee Compared to the US, ("RTAC") and other patients save up to agencies under the 60-80% in cost. Refer to ISQua. Image 2.7 for fees comparison to gauge the affordability of Malaysia Healthcare against regional peers. Image 2.6: Malaysia Healthcare’s Unique Selling Points Malaysia Healthcare Chronicles 2009 - 2019: 44 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

Major Procedures: Comparative Costs (US Dollars)

Healthcare travel coverage in Malaysia is wide and extremely comprehensive, and foreign patients flock to Malaysia for a number of reasons: impeccable quality, accessibility and affordability. Malaysia is highly connected to all major global travel hubs, and waiting times for appointments are minimal. Costs of treatments in Malaysia are highly competitive, allowing travellers to receive quality medical treatment for a fraction of the cost in an exotic, tropical haven.

US Cost Costa India Malaysia Mexico Singapore South Taiwan Thailand Rica Korea Average Savings 45 to 65% 65-90% 60 to 80% 40 to 60% 25 to 40% 25 to 45% 40 to 65% 50 to 75% Coronary artery $92,000 $31,500 $9,800 $20,800 $34,000 $54,500 $29,000 $27,000 $33,000 bypass graft - CABG Valve replacement $87,000 $28,000 $11,900 $15,000 $26,500 $46,000 $38,000 $22,000 $19,000 with bypass Total hip replacement $31,000 $15,300 $9,400 $12,500 $14,200 $21,400 $21,600 $14,000 $16,500 Total knee $28,000 $14,200 $7,200 $7,800 $12,300 $19,200 $16,250 $13,400 $13,200 replacement Laminectomy $65,000 NA $9,500 $14,250 $22,500 $27,800 $24,200 $18,000 $16,000 IVF cycle, excluding $12,500 NA $3,300 $4,200 $5,800 $9,450 $7,500 $4,600 $4,000 medication Gastric bypass $23,000 $10,500 $6,800 $9,250 $11,500 $14,800 $14,500 $12,700 $12,600 4-implant porcelain $21,500 $9,350 $6,850 $7,700 $9,300 $11,800 $9,900 $8,700 $9,300 bridge Implant-supported $11,500 $4,250 $3,300 $3,750 $4,100 $7,000 $5,650 $4,350 $3,700 dentures (upper and lower) Full facelift $11,500 $4,900 $2,800 $3,300 $4,750 $7,850 $5,900 $5,250 $3,700 Rhinoplasty $4,800 $2,600 $1,400 $2,800 $3,100 $3,500 $3,800 $3,200 $1,600

Disclaimer: Exchange rate may very depending on the year. This serves solely to provide an estimate on cost saving.

Notes: * US costs vary based on location, materials and equipment used, and individual patients’ requirements. Figures are averages and reflect more common incidence of cost. All figures are in US dollars. ** International estimates include all treatment related costs but exclude travel and accommodation. Figures are averages and reflect more common incidence of cost. All figures are in US dollars. Patients should confirm pricing with their doctor or facility.

Image 2.7: Cost comparison among top healthcare travel destinations

However, beyond these macro factors, Malaysia Healthcare has developed unique and innate strengths that has propelled patient trust, a strong branding and industry growth. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 45

Following are some of Malaysia’s inherent advantages that has enabled the country to become a top medical tourist destination in SEA and Asia over the past decade:

STRONG GOVERNMENT SUPPORT Government lends support across the value chain to private healthcare providers, pharmaceutical companies and others, and actively works to foster closer integration across players within the healthcare industry.

GOOD GOVERNANCE Strong government support is exemplified by the development of sound policies and a robust regulatory framework that governs the provision of medical care. This delivers trust and confidence within the system (peace of mind).

SUPPORTED BY A STRATEGIC, DEDICATED AGENCY: MHTC The presence and role played by MHTC further streamlines healthcare service providers and industry players in both the private and government sectors to create a comprehensive and holistic healthcare travel ecosystem.

PRIORITISATION OF HEALTHCARE TRAVEL AS AN ECONOMIC GROWTH ENGINE The Malaysian government has identified healthcare travel as a key Entry Point Project (“EPP”) within the healthcare National Key Economic Area (“NKEA”) which comes under the Malaysian government’s Economic Transformation Programme (“ETP”). Hence, healthcare receives strategic support to spur its development.

PUBLIC-PRIVATE PARTNERSHIP MODEL The creation of synergistic partnerships via the government’s public-private partnership (“PPP”) cooperation model contributes to further industry growth and enhances the capabilities of the local industry

Image 2.7: Advantages of Malaysia’s healthcare travel industry Malaysia Healthcare Chronicles 2009 - 2019: 46 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

2.3.1 Good Governance

One of Malaysia’s fundamental strengths as a leading healthcare travel destination stems from the robust regulatory and industry framework that has been implemented across the industry.

Malaysia’s healthcare environment is highly regulated to safeguard patients’ interests

Arrival Medical + Travel Departure

Arrival Hospitals Hospitals Tourist Activities Departure • Anti-Money Laundering, (A) For Healthcare (B) For Private Healthcare Providers • Entertainment Act 1992 • Civil Aviation Act 1969 Anti-Terrorism Financing Professionals: • 13th Schedule of the Private Healthcare Facilities • Food Act 1983 • Customs Act 1967 and Proceeds of • Allied Health Professions and Services Act 1998 • Food Act 1983 • Immigration Act 1959/63 Unlawful Activities Act Act 2016 • Atomic Energy Licensing Act 1984 (Act 304) • Hotels Act 2003 • Insurance Act 1996 2001 • Dental Act 1971 (Act 51 • Competition Act 2010 • Innkeepers Act 1952 • Limitation Act 1953 • Civil Aviation Act 1969 for Dental Professionals) • Dangerous Drugs Act 1952 (revised 1980) (revised 1981) • Passports Act 1966 • Customs Act 1967 • Medical Act 1971 • Employment (Amendment) Act 2012 • Insurance Act 1996 • Personal Data Protection • Dangerous Drugs Act (Act 50 for Medical • Fees Act 1951 - Fees (Medical) (Amendment) • Land Public Transport Act 2010 1952 (revised 1980) Professionals) Order 1994 Act 2010 • Drug Dependents • Medical Assistants • Food Act 1983 • Local Government Act (Treatment and (Registration) Act 1977 • Human Tissue Act 1974 1976 Rehabilitation) Act 1983 (Act 180) • Innkeepers Act 1952 (revised 1981) • Local Government Act • Immigration Act 1959/63 • Midwifery Act 1966 (Act • Insurance Act 1996 1976 (Spa By-Law) • Internal Security Act 436 – revised 1990) • Local Government Act 1976 • Price Control and 1960 • Nurses Act 1950 (Act 14 • Medical Device Act 2012 (Act 737) Anti-Profiteering Order • Malaysian Health – revised 1969) • Medicines (Advertisement and Sales) Act 1956 (Marking of Service Promotion Board Act • Optical Act 1991 (revised 1983) Charge for Hotel and 2006 • Registration of • Mental Health Act 2001 Restaurant) 2015 • Medical Act 1971 Pharmacists Act 1951 • Occupational Safety and Health Act 1994 • Pubic Order • Passports Act 1966 (Act 371 –revised 1989) • Optical Act 1991 (Preservation) Act 1958 • Prevention and Control • The Medical • Patient’s Charter • Registration of Guests of Infectious Diseases (Amendment 2012) Act • Personal Data Protection Act 2010 Act 1965 (revised 1989) Act 1988 1971 for Medical and • Poisons Act 1952 • Service Tax Act 2018 • Tourism Industry Act Dental Specialists • Prevention and Control of Infectious Diseases Act • Tourism Industry Act 1992 1988 1992 • Private Healthcare Facilities And Services Act • Tourism Tax Act 2017 1998 • Tourism Vehicles • Registration of Businesses Act 1956 Licensing Act 1999 • Sales of Drugs Act 1952 (revised 1989) • Traditional and • Telemedicine Act 1997 Complementary • Traditional and Complementary Medicine Act 2016 Medicine Act 2016 Source: MHTC • Treatment and Rehabilitation Act 1983

Image 2.8: Safeguarding patient experience from beginning to end

2.3.2 Focussed on Enhancing Seamless End-to-End Experiences

Over the years, the Malaysian government, together with supporting facilitating agencies, have worked concertedly to refine the healthcare travel ecosystem towards becoming more customer centric and to consistently deliver excellent satisfaction and positive experiences across the patient’s journey.

The strategy has been centred on delivering exceptional outcomes at all key phases of the passenger journey; from pre- to post-treatment.

By constantly exemplifying healthcare travel satisfaction throughout the healthcare travel journey, Malaysia Healthcare has successfully earned the trust of patients by affording them peace of mind. These perceptions of “trust” and “peace” have become key attributes associated with the Malaysia Healthcare brand. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 47

End-to-end seamless care

During Post-treatment Pre-treatment treatment

Worldwide MHTC Wellness Representatives concierge lounge

Call centre Arrival Rehabilitation Departure Malaysian Healthcare : TOUCHPOINTS

Appointed agents/ Hospital Travel Health facilitators Hotel

Asian hospitality, international care

Image 2.9: The end-to-end Malaysia Healthcare experience

Playing a leading role in facilitating this seamless experience is MHTC, who lends its unique expertise in many ways. One of which is functioning as a go-to centre that patients can refer to for clarification or assistance throughout their treatment journey and experience. Malaysia Healthcare Chronicles 2009 - 2019: 48 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 2

Malaysia Healthcare: Asia’s Best Kept Secret

Tapping into the Healthcare Market via MHTC Member Hospitals

One of MHTC’s initiatives is the introduction of Hospital Partnership Programme. It is a unique programme that is valid for two years and identifies a select list of private hospitals to drive the healthcare travel industry. These hospitals are evaluated by an Evaluation and Selection Committee (“E&S Committee”), comprising representatives from various industry stakeholders, namely MoH, APHM, MMC, MDA and others. The E&S Committee convenes periodically to evaluate applications from interested private healthcare facilities and grants renewal to existing members upon membership expiry. The approval from the E&S Committee is based on the private healthcare facilities fulfilling stringent set criteria including accreditation from recognised accreditation bodies under the International Society for Quality in Health Care (“ISQua”).

Facilities can apply to be MHTC Members, the coveted Elite membership is strictly by invitation only and currently granted to 21 members.

Selection Member facilities by committee Screened by Elite Members possess hospital consisting of stringent criteria in represent the accreditation representatives both healthcare and best of Malaysia accredited by from the Ministry supporting services Healthcare ISQua of Health and private sector

Image 2.10: MHTC Member Screening and Selection Process Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 49

MHTC Member Hospitals Participating Medical Services Providers of MHTC 73 21 52

MHTC Elite Members

MHTC Ordinary Members

• Advance Vision Eye Specialist Centre • Kedah Medical Centre • Prof Muhaya Eye and Lasik Centre • ALPS Medical Centre • KL Fertility Centre • KPJ Puteri Specialist Hospital • Assunta Hospital • KPJ Johor Specialist Hospital • Regency Specialist Hospital • Avisena Specialist Hospital • KPJ Klang Specialist Hospital • Sentosa Medical Centre • Bagan Specialist Centre • KPJ Pahang Specialist Hospital • Sri Kota Specialist Medical Centre • Beverly Wilshire Dental • KPJ Pasir Gudang Specialist Hospital • Tawakkal Health Centre • Borneo Medical Centre • KPJ Perdana Specialist Hospital • Tawau Specialist Polyclinics • Cardiac Vascular Sentral Kuala Lumpur • KPJ Pusat Pakar Mata Centre for Sight • The Tun Hussein Onn National Eye Hospital • Columbia Asia Hospital (Puchong) • KPJ Sabah Specialist Hospital • Timberland Medical Centre • Dentalpro Dental Specialist Centre • KPJ Seremban Specialist Hospital • TMC Fertility & Women’s Specialist Centre (Puchong) • DSS Dialysis Centre (Da Vita) • Life Care Diagnostic Medical Centre • TMC Fertility & Women's Specialist Centre (Johor) • Genesis IVF & Women’s Specialist Centre • Manipal Hospitals • TMC Fertility & Women's Specialist Centre (Pulau Pinang) • Gleneagles Kota Kinabalu • Metro IVF Fertility Centre • Topvision Eye Specialist Centre • Gleneagles Medini • Normah Medical Specialist Centre • Tung Shin Hospital • Golden Horses Health Sanctuary • Oriental Melaka Straits Medical Centre • UMSC Ambulatory Care & Specialist Clinic • IMU Oral Health Centre • Pantai Hospital Ayer Keroh • White Dental Cosmetic Centre • International Specialist Eye Centre (ISEC) • Pantai Hospital Penang The information above is correct as of September 2019. Please refer to our website www.mhtc.org.my/services/mhtc-partners • Jesselton Medical Centre Sdn Bhd • Pristine Dental Centre for more details. Malaysia Healthcare Chronicles 2009 - 2019: 50 A 10 Year Journey of Malaysia’s Healthcare Travel Industry Why do we Leverage Partnerships? “The level of co-operation between government agencies and private hospitals is unprecedented within Malaysia Healthcare. The close working relationship has enabled Malaysia to be successful and sustainable and ultimately becoming a role model for others to emulate.’’

Mr. Fabian Bigar Undersecretary of Policy and International Relations Division Ministry of Health Malaysia Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 51 Malaysia Healthcare Chronicles 2009 - 2019: 52 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 3: The Integrated Value Chain of the Healthcare Travel Industry

3.1 Close Working Partnerships Amidst an Integrated Value Chain 3.2 Malaysia Healthcare: Key Players and Industry Structure 3.3 Addressing Industry Challenges and Gaps Across an Empowered Value Chain 3.4 Enabling Malaysia Healthcare’s Growth and Progress Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 53

3.1 Close Working Partnerships amidst an Integrated Value Chain

One of the distinguishing features of Malaysia’s approach towards developing its healthcare travel sector is Public-Private Partnership (“PPP”) collaboration.

A series of chronological events marked an unprecedented level of cooperation between the industry and the government and state agencies:

• Recognition of the healthcare travel sector as an Entry Point Project under the National Key Economic Area (“NKEA”) • Establishment of the Malaysia Healthcare Travel Council (“MHTC”) under the leadership of Ministry of Health (“MoH”) • Recognition as one of the key services sectors under the National Export Services Council • Shifting under the stewardship of Ministry of Finance to further propel this fast-growing sector

The government has taken a holistic approach in addressing barriers that hamper the industry’s growth and creating a policy framework in which the industry can thrive. This has enabled Malaysia Healthcare to occupy a unique and sustainable position within the region in the long run.

As the primary agency driving the healthcare travel industry, MHTC brings together an alliance encompassing government agencies, private healthcare players, and industry stakeholders. Together, this alliance drives the sector forward more efficiently and effectively by fostering greater private sector involvement which is enabled through strong support from the government.

By tapping into the private sector business acumen and the regulatory support of government, typical issues such as bureaucracy, lack of business understanding, time to market, and others can be effectively resolved. In the same vein, the aforementioned benefits have also been felt across the Malaysia Healthcare travel value chain.

The following section focusses on various collaborative roles by the government agencies in critical areas for development of the private healthcare travel sector. Malaysia Healthcare Chronicles 2009 - 2019: 54 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 3

The Integrated Value Chain of the Healthcare Travel Industry

3.2 Malaysia Healthcare: Key Players and Industry Structure

ADVISORY LEADERSHIP

Ministry of Ministry of Ministry of Tourism, Ministry of Ministry of International Finance Health Arts, and Culture Economic Affairs Trade and Industry

FACILITATION AND PROMOTION

PUBLIC PRIVATE

Immigration Department of Malaysia Association of Private Hospitals of Malaysia

Malaysian Dental Council

State Tourism and Medical Tourism Agencies

Economic Corridor Authorities

Image 3.1: Public and private players of Malaysia Healthcare

Key Industry Players

The leadership of the governmentMinistry of Economic operates at a macro and micro level in addressingAssociation the industryof Private holistically: MHTC (CEO) Affairs Hospitals Malaysia Macro-Level: Develop the overall strategic direction and framework for sustainable growth and development of the healthcare travel industry through aligning various government and private stakeholder efforts in realising Malaysia as the Malaysian Investment leading global destination for healthcare.Development Malaysia Society for Authority Quality in Health Providing the central leadership for the industry, Malaysia Healthcare has the full commitment of the four government ministries: Ministry of Finance (“MoF”), the leading Ministry, Ministry of Health (“MoH”), Ministry of Economic Affairs (previously the Economic Planning Unit (“EPU”) under the Prime Minister’s Department) and Ministry of Tourism, Arts and MoH Medical Immigration Culture (MOTAC). Practice Department of Malaysia The industry is further supported by other Ministries such as the Ministry of International Trade and Industry (“MITI”) and the respective government agencies,MoH Policy such and as the Malaysia External Trade Corporation (“MATRADE”), Malaysian Industrial Development Authority (“MIDA”),International and the Malaysian Immigration Department toTourism create Malaysia policy, governance and attract Relations participation through an open and efficient business environment for the industry stakeholders. MATRADE ADVISORY LEADERSHIP

Ministry of Ministry of Ministry of Tourism, Ministry of Ministry of International Finance Health Arts, and Culture Economic Affairs Trade and Industry

FACILITATION AND PROMOTION

Malaysia Healthcare Chronicles 2009 - 2019: PUBLIC PRIVATE A 10 Year Journey of Malaysia’s Healthcare Travel Industry 55

Immigration Department of Malaysia Association of Private Hospitals of Malaysia

Malaysia External Trade Development Corporation Malaysian Medical Association (”MMA”) (”MATRADE”) Private Medical and Dental Facilities Malaysian Investment Development Authority (”MIDA”) Health Facilitators Tourism Malaysia Airlines Malaysia Airports Holdings Berhad (”MAHB”) Micro-Level: Build trust in Malaysia Healthcare servicesHotels - affordability, accessibility and quality care, through innovative Malaysian Society for Quality in Health destination marketing, seamless experience offerings and excellence in product and services. Travel Agents Malaysian Medical Council The government agencies, through coordinated and aligned efforts with industry stakeholders and private healthcare Malaysian Dental Council sector at all levels, come together to take accountability and ownership to continuously revitalise the industry and secure State Tourismits and growth. Medical ThisTourism is achieved Agencies through the Advisory Committee consisting of representatives from key ministries and agencies, to provide oversight and advisory with the main aim of removing barriers, to enable, implement and develop the sector. Economic Corridor Authorities

Provide Advice and Leadership Provide advice and leadership in the promotion of the healthcare travel industry. Act as an enabler to guide the infrastructure and Ministry of Economic Association of Private MHTC (CEO) ecosystem development, toward sustainable Affairs Hospitals Malaysia healthcare travel industry for the country.

Malaysian Investment Facilitate and Support Development Malaysia Society for Authority Quality in Health Identify, facilitate, and provide support for public-private partnership collaboration within the healthcare travel industry.

MoH Medical Immigration Practice Department of Healthcare Quality and Development Advisor Malaysia Provide advice and assistance in the MoH Policy and development of measurable outcome for International Tourism Malaysia quality care delivery of the healthcare travel Relations industry, as well as the development and MATRADE implementation of policy to support the healthcare travel industry. Image 3.2: MHTC Advisory Committee

Private Sector Players

Healthcare travel providers are the many private hospitals, wellness centres, medical spas and allied health service providers. The role of industry players is to deliver healthcare in accordance to quality benchmarks set by the government towards maintaining the existing strong levels of patient trust and confidence that the Malaysian healthcare travel sector is currently well known for. The linkage between healthcare travel and private medical care is strong as the key players serving healthcare travellers are largely private sector players, be it hospitals, wellness centres or healthcare facilitators.

There are over 260 private healthcare facilities in Malaysia, of which 73 are members of the Malaysia Healthcare Travel Council (“MHTC”). MHTC member hospitals are internationally accredited and have the facilities and end-to-end service capacity to cater to international patients. With the support from the government, MHTC members commit to investing in both capacity and capability building, improvements to quality care and patient safety, and overseas marketing to drive the international segment. Representing the private healthcare providers is the umbrella body of Association of Private Hospitals Malaysia (“APHM”), which serves an important role in shaping the healthcare travel policies and strategies of Malaysia Healthcare.

Supporting the industry are commercial players such as airlines, financial service providers, transporters and logistics companies; all of which help to complete the value chain. Malaysia Healthcare Chronicles 2009 - 2019: 56 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 3

The Integrated Value Chain of the Healthcare Travel Industry

3.3 Addressing Industry Challenges And Gaps Across an Empowered VALUE CHAIN

While Malaysia Healthcare has performed well, especially in bridging growth gaps, players within the industry continue to face long-persisting challenges that impede the industry’s full potential for growth.

Throughout 2015-2016, slow economic growth due to a wide range of global /macro factors affected Malaysia Healthcare’s growth capabilities, with issues such as reduced crude oil prices, reduced private investment, depressed domestic spending, a weakened ringgit, and rising inflation among other factors.

Yet, against these tremendous odds, the industry continued to chart its upward trend in revenue and patient volume. This is largely attributed to the resilience of the industry and the diligent efforts of all parties involved in sustaining growth momentum.

While 2017-2018 saw macro-economic improvement, the overall healthcare industry continued to feel the effects of budgetary constraints. 2017 alone saw a 60% budget reduction, thus requiring careful consideration of branding, positioning and marketing activities.

In response, Malaysia Healthcare persistently adapts to the challenges faced. The following is a snapshot of the various industry gaps and challenges that continue to impact Malaysia Healthcare.

INDUSTRY GAP INDUSTRY CHALLENGES

• Malaysia Healthcare has a smaller share of the • Final mile conversion: Converting potential ASEAN healthcare travel pie healthcare travellers into Malaysia Healthcare • Too reliant on traditional markets patients (low consumer brand equity) • Unfavourable in-patient to out-patient ratio • Building momentum and maintaining consistent branding and visibility including brand • Lack of strong Malaysia healthcare travel brand differentiation due to budget cuts • Shortage in qualified medical personnel • Tug-of-war with regional competitors who have • Service capacity utilisation limits high investments in their respective healthcare • Varied standards of service travel industries • Poor network and relationships in focus regions, • Healthcare travellers' evolving needs and wants resulting in little to no advocacy • Fortification of focus markets' healthcare • Rapid evolvement of healthcare traveller systems demands which require fast, personal and • Reduction of outbound traffic from source effective response (healthcare travellers countries demand better value for money services i.e. • Budgetary setbacks that led to financial quicker appointment making, better customer constraints and delays in intended programmes service, etc). and projects. • Weak ringgit impacts marketing and promotional capabilities Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 57

3.4 Enabling Malaysia Healthcare’s Growth And Progress

The government working concertedly with the private sector coupled with the strategic support of MHTC, has developed a clear roadmap towards addressing the various challenges and issues faced by Malaysia Healthcare.

3.4.1 Government as an Enabler

The government also continues to lend its unabated support by providing the following:

• Supporting private sector led innovation and investment • Enhancing fundamentals (transportation, connectivity, attractions, infrastructure) • Strengthening healthcare quality (workforce and services) • Continuous facilitation via policies and regulatory framework

The Malaysian government has established business friendly policies and legislative frameworks which are continuously reviewed to maintain relevance and respond to market needs.

POLICIES EFFECTIVE YEARS DESCRIPTION Fiscal incentives by Ministry of Finance

Capacity building 1 Jan 2010 – 31 Dec 2014 Companies that establish new private healthcare facilities or Investment Tax Allowance for existing private healthcare facilities undertaking expansion/ Private Healthcare Facilities First extension: modernisation/refurbishment for purposes of promoting 1 Jan 2015 – 31 Dec 2017 healthcare travel, are eligible to apply for an income tax exemption equivalent to Investment Tax Allowance (“ITA”) of Second extension: 100% on the qualifying capital expenditure incurred within a 1 Jan 2018 – 31 Dec 2020 period of five (5) years.

Impact: Total potential investments of almost MYR10 billion consisting of more than MYR1 billion from foreign investment and more than MYR8 billion from local investment which will generate over 15,000 job opportunities in the healthcare sector. Expand export services Existing To further promote the export of Malaysia Healthcare Tax exemption on the value of services offered to foreigners, the private healthcare is increased exports qualified for tax exemption of 50% on the value of increased exports income, subject to 70% of the statutory income for each year of assessment.

Year of Assessment Effective from the Year of Assessment 2010 until the Year (“YA”) of Assessment 2014, the level of tax exemption rate has 2010 – YA2014 been increased to 100% of the value of increased exports of services.

YA2018 – YA2020 The enhancement to 100% was reintroduced for YA2018 to YA2020 to stimulate private hospitals to invest and diversify its overseas market. Malaysia Healthcare Chronicles 2009 - 2019: 58 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 3

The Integrated Value Chain of the Healthcare Travel Industry

POLICIES EFFECTIVE YEARS DESCRIPTION Fiscal incentives by Ministry of Finance

Improve Quality With effect from (“wef”) Private healthcare facilities registered with Malaysia Double Tax Deduction for YA2016 Healthcare Travel Council (“MHTC”) are eligible for double Quality Accreditation tax deduction on the expenditures incurred for the purpose of obtaining quality accreditation from the following quality accreditation bodies recognised under theThe International Society for Quality in Healthcare (“ISQUA”) with effect from YA2016:

• Malaysian Society for Quality in Health (“MSQH”) • Joint Commission International Accreditation (“JCI”) • Caspe Healthcare Knowledge Systems (“CHKS”) Accreditation Unit • The Australian Council on Healthcare Standards (“ACHS”) • Reproductive Technology Accreditation Committee (“RTAC”) YA2018 With effect from YA2018, healthcare facilities have obtained quality accreditation from the above bodies for registered ambulatory care centre and dental facilities with MHTC. Encourage promotion Existing Expenses for the purpose of export of services which overseas are eligible for further deduction under the Promotion of Further deduction for Investments Act 1986 include: promotion of export services • Market research • Cost of preparing technical information • Travel fares overseas including accommodation and sustenance • Cost of maintaining sales offices overseas Medical professional fee cap revision Increase in medical Wef Oct 2016 This policy increases the cap limit for medical professionals professional fee capping for to cover associated costs to cater to international patients. foreign patients allowing a maximum of 25% under the 13th Fee Schedule Bringing Malaysian medical experts back by TalentCorp Enhanced Returning Expert Wef 2012 TalentCorp initiative under the Returning Expert Programme Programme (“REP”) (“REP”) facilitates the return of expert Malaysian medical professionals from abroad, to contribute their skill sets and to address the issue of a shortage of professional and technical experts in the country. Ease entry and extension of stay of healthcare travellers by Ministry of Home Affairs and Immigration Department of Malaysia eVISA (Medical) Wef Oct 2018 The eVISA (Medical) allows healthcare travellers travelling to Malaysia to easily obtain their eVISA online for medical purposes, which at the same time enhances both security and convenience. Visa facilitation for healthcare Wef 1st July 2016 Visa facilitation processes for healthcare travellers in 2016 travellers for those from Myanmar (through Malaysia Healthcare Representative Office) and Bangladesh (MHTC appointed representative partners). Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 59

In addition, various agencies and stakeholder has been at the forefront in the promotion of healthcare travel. Some of them include:

Malaysia Tourism Promotion Board - An agency under the Ministry of Tourism and Culture Malaysia (“Tourism Malaysia”) focusing on promotion of Malaysia at both domestic and international levels. - Jointly with Tourism Malaysia offices abroad in their market tactical through tourism roadshows and international tourism events to build awareness of Malaysia healthcare as a niche sector in target markets to driver greater conversion from awareness to intention. - Leverage on Tourism Malaysia to reach people globally through their international advertising platform. Malaysia Investment Development - MIDA leads the capacity building of the private healthcare facilities Authority (“MIDA”) through promotion of local and foreign investments into the healthcare sector in Malaysia. - In addition, the agency is in-charge of the investment tax allowances application for private healthcare facilities. Malaysia External Trade - The national trade promotion agency under Ministry of International Development Corporation Trade and Industry (“MITI”). (“MATRADE”) - Promote Malaysia Healthcare and open doors to potential partners and buyers through their export promotion activities including trade exhibitions, trade missions, specialised marketing missions and MATRADE incoming buying missions. Malaysia Airports Holdings Berhad - Strategic support from MAHB to have presence of the Malaysia (“MAHB”) Healthcare Concierge and Lounge in key international airports (KL International Airport 2013, Penang International Airport 2014, KLIA2 2019) as the first contact points for medical tourists in Malaysia and to provide seamless service for medical tourists. Health Informatics Centre (Ministry - Malaysia Healthcare Travel Council (“MHTC”) partners Health of Health), Tourism Malaysia, Informatics Department of Ministry of Health in improving data Department of Statistics Malaysia collection, timely submission and data reliability for healthcare travel. - In addition, MHTC works in collaboration with Tourism Malaysia in Departing Visitor Survey, Department of Statistics Malaysia in Balance of Payments, and Immigration Department for arrivals data in the Inbound Tourism Expenditure measurement. Malaysia Healthcare Chronicles 2009 - 2019: 60 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 3

The Integrated Value Chain of the Healthcare Travel Industry

3.4.2 Private Industry Players as Drivers

Malaysian private hospitals, active in driving the healthcare travel industry, have continued to enhance their service offerings, quality of medical treatments and training of professionals to match and surpass international benchmarks. At the same time, various industry players along the value chain have been elevating the standard of their service offerings which inadvertently enhances the seamlessness of the healthcare travel journey experience.

GOAL

MYR2 billion in Healthcare Travel Revenues by 2020

Strategies

Amplifying Branding Building Industry Delivering Niche and Marketing Sustainability Experiences

Image 3.3: Strategies for industry building

Industry players have committed to building the healthcare travel industry of Malaysia using the following strategies:

1. Amplifying Branding and Marketing – Using creative and traditional means to create a lasting and impactful brand presence in focus markets. 2. Building Industry Sustainability – Enhancing service offerings and service capacity through sustainable measures. 3. Delivering Niche Experiences – Improving checkpoints along the healthcare travel journey to deliver one-of-a-kind experiences. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 61

Industry Strategic Review

Malaysia Healthcare took the initiative to conduct an industry strategic review with relevant stakeholders in the public and private sector, to ensure the industry’s growth through collaboration. 2017’s industry strategic review between public-private sectors focused on talent retention and capacity building.

Malaysian Private Hospitals Private Sector Industry Players State Governments Actively upgrade Airline companies increase Enhance transportation or refurbish their flights to and fro focus service offerings such as infrastructure including markets and establish new refurbishing ferry jetties and expanding existing facilities routes to tier 2 cities upgrading airports. or building new ones Establish talent upskilling Creating novel inventions in Establishing committees programmes to enhance the pharmaceutical world and councils dedicated to expertise of medical which positions Malaysia growing the healthcare professionals as a global healthcare travel industry stronghold Establishing representative Including healthcare travel offices in focus markets as an agenda in developing state-building plans Running targeted on-ground Running tourism campaigns campaigns and digital marketing campaigns Pursuing international accreditations

Strategy Legend Amplifying Branding and Marketing

Building Industry Sustainability

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3.4.3 MHTC as Industry Growth Catalyst

Since 2015, MHTC has utilised strategies developed to address gaps within the industry (Please refer to section 2.2). These strategies have been implemented using the following core pillars: Industry Facilitation, Sustainable Growth and Digital Marketing. A combination of the core pillars and strategies have enabled MHTC to carry out a myriad of initiatives leading to the industry’s annual growth and successes.

CORE PILLARS

DIGITAL INDUSTRY FACILITATION MARKETING SUSTAINABILITY

Amplify Branding Elite and Recognition Hospital

Strengthen End-to-End Public-Private Value Chain Partnership

Enhance Networks Government to and Relationships Government

Image 3.4: Strategies and core pillars of MHTC Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 63

Following is a timeline perspective of how MHTC has adapted and responded to the various issues and challenges faced to continue ensuring industry growth and the achievement of set goals and targets.

• Greenfield market expansion coupled with specific unique-selling points promotion in 2016 resulted in significant growth in Three-pronged approach: traveller numbers and healthcare revenues • Introduction of long-term industry • Amplifying brand recognition, sustainability initiatives in line with industry • Building networks and relationships, and facilitation, digital marketing optimisation • Enhancing patients’ end-to-end experience and sustainable growth

2015 2017 2016 2018

• Improving internal processes and • Set clear objective to position Malaysia as strengthening service quality the leading global destination for healthcare • Addressing potential trust deficits in • Undertaking of gaps assessment in the key the value chain and patient end-to-end areas of brand reach, end-to-end patient experience. service offerings and healthcare traveller • Upping collaboration with government source markets ministries, agencies, immigration, private • Further refinement of 2015’s growth sector players and others strategies (amplify branding and recognition, • Identification of state-by-state requirements strengthen end-to-end value chain and and working concertedly to develop enhance networks and relationships) customised solutions • Tapping of relationship networks to fortify • Optimisation of existing constricted budgets the Malaysia Healthcare brand throughout and expansion into new greenfield markets the fiscal year with unique USPs for specific markets: • Further promotion of several catalyst o China: Fertility initiatives: o India: Cardiology o Malaysia as the Fertility and Cardiology o Vietnam: Health Screening and Oncology Hub of Asia (2018 – 2019) o Myanmar: Oncology and Cardiology o Champion Malaysia Year of Healthcare o Indonesia: Cardiology, Oncology, Travel 2020 Orthopaedics o Soft-launch eVisa (Medical) in 2018 Malaysia Healthcare Chronicles 2009 - 2019: 64 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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CEO Dialogue

As a facilitator and in the spirit of nation-building, MHTC sought to establish a platform for sharing industry achievements and explore areas of collaboration.

Though the Annual CEO Dialogue has run on a regular basis, the Regional MHTC CEO Dialogue, introduced in 2015, allows the customisation of agendas by region-based challenges.

CEO Dialogue with MHTC member hospitals CEO Dialogue with Minister of Finance

Industry Strategic Review

MHTC also partnered with International Investor for an Industry Roundtable session involving the same stakeholders, regarding the health and future of the Malaysian healthcare industry, which will result in the publication of the Malaysia Health and Wellness Strategic Review report.

Malaysia Healthcare took the initiative to conduct an industry strategic review with relevant stakeholders in the public and private sector, to ensure the industry growth through collaboration. 2017’s industry strategic review between public-private sectorsIndustry focused on talentStrategic retention and capacityReview building.

Industry Strategic Review

Strategy Legend Core Pillar Legend Amplify branding Facilitation and recognition Strengthen end-to-end Digital marketing value chain Enhance networks and Industry Sustainability relationships Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 65

Government-to-Government Initiatives

Recognised by foreign governments for our successful private-public partnership initiatives, Malaysia received invitations to share our experience and expertise in several international conferences related to medical tourism.

Tuvalu

Meeting with Qatar health officials

Maldives

Meeting with Brunei government officials

Brunei Health Ministry

G2G Highlights

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Supply-Demand Studies

Refer to Section 2.2

Partnership for Healthcare Travel Excellence Programme

Refer to Section 5.1.1.2

Collaborations through Partnerships

Please refer to page 10

Speaking Engagements

Over the past five years, MHTC has made a mark in many countries, shouting Malaysia Healthcare’s strengths and value propositions to the world.

Singapore Tunis, Tunisia Athens, Greece

Seongnam, South Korea Crikvenica, Croatia

insigHT

Malaysia Healthcare’s very own medical travel market intelligence conference began in 2016, attracting international delegates and speakers today. The conference encourages knowledge exchange and sharing on the latest industry updates while fostering new networks and partnerships.

insigHT2018 launch

insigHT2017 eVISA (Medical)

The eVISA (Medical) is a joint initiative between the Immigration Department and MHTC. This ground-breaking online- based platform (eVisa) offers an online visa (medical) application from abroad. (Phase II) Future plans include online visa extension for foreign patients requiring extended stay.

eVisa (Medical)

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Malaysia Healthcare Representatives Worldwide

In an effort to optimise every touchpoint along the healthcare traveller’s journey, Malaysia Healthcare Representative Offices have been established in several focus markets: Indonesia, (Jakarta), Bangladesh (Dhaka), Vietnam (Ho Chi Minh City and Hanoi), and Myanmar (Yangon). Healthcare travellers are able to visit the offices, receive all needed information and plan their entire journey with the guiding hand of a human touch. Two Malaysia International Referral Centres have also been established offering facilitation of patient enquiries, consultation and pre-IVF traditional medicine treatment, tele-consultation and quarterly one-on-one consultations

MHRO Vietnam MHRO Vietnam

NCH Representative Office Launching in Bangladesh

MIRC2 in Hangzhou, China

Malaysia Healthcare Travel Council Partnership Programme

Please refer to section 2.3.2

Malaysia Healthcare Lounge and Concierge Services

The MHTC Concierge and Lounge provides healthcare travellers peace of mind as they assist them from the aerobridge to the transportation of their next destination. Through the Meet-and-Greet service, healthcare travellers are greeted upon disembarkation at the aerobridge, assisted through Immigration and Customs, baggage claims, and are hosted at the lounge.

KLIA KLIA2

Meet-and-Greet Service PIA www.malaysiahealthcare.org

This website was established to direct visitors to the right channels: healthcare travellers to www.medicaltourismmalaysia.com and stakeholders to www.mhtc.org.my

Market Videos

Over the years, Malaysia Healthcare has produced a variety of marketing videos which showcase the strength of our service offerings. These videos have been translated into eight languages: English, Chinese, Vietnamese, Burmese, Arabic, Russian, Bengali and Japanese.

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Brand Story

The Brand Journey of Malaysia Healthcare’s Brand Campaign Travelling T-shirts Roadmap #dream maker

2020 DreamsGiving hope to 2019 2018 “Experience Malaysia 2017 Healthcare” Germany Tunisia Qatar

2016

Taiwan Indonesia China

Destination Awareness Destination Recognition Destination Recall

USA United Kingdom Greece Highlighting Malaysia’s most Highlighting Malaysia’s niche Malaysia as Asia’s unique qualities (quality, service o erings (fertility, leading healthcare a ordability, accessibility) as cardiology) travel destination a healthcare travel destination of choice

Brunei Croatia Malaysia

MyLovesYou

The “Malaysia Loves You” campaign was introduced as a component part of Malaysia Healthcare’s brand repositioning exercise. It was launched on 29th Feb 2016 by the then Minister of Health, YB Datuk Seri Dr. S. Subramaniam. The campaign is structured as an influencer-driven program where its primary objective is to effectively communicate the essential attributes of Malaysia Healthcare, i.e.: Quality, Accessibility, Affordability + Ease of Communication. In essence, Malaysia Loves You is positioned to entice the international audience to “Experience Malaysia Healthcare, Embrace Malaysian Hospitality”

ShareMyLove ShareMyXperience

On 13th February 2017, Share My Love was introduced “Share My Xperience” (SMX) is Malaysia Healthcare’s as a continuation of the Malaysia Loves You campaign. thematic campaign for 2019. SMX focuses on health and Continuing the theme of MLY, SML carries the message wellness by emphasising on the importance of preventive of love, and sharing this love with others in the spirit of health screening in leading healthy lives. SMX invites people healthcare and wellness. SML is an expression of love, from all walks of life to share their experiences in practicing carrying the essence of Malaysian hospitality, using art as good healthcare and the preventive measures they have a medium. It featured a collaboration between Malaysia undertaken in maintaining their health. SMX ultimately Healthcare and 7 up-and-coming local artists to inspire aims to encourage everyone to come Experience Malaysia others to express their love through heARTworks. Healthcare and lead healthier lives.

Malaysia Year of Healthcare Heartbeat of Asia Travel 2020 (MYHT2020) Refer to Section 5.1.6 Refer to Section 5.1.4

Giving Hope to Dreams

Refer to Section 5.1.5

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Medical Travel Media Awards

Medical Travel Media Awards (MTMA) was launched in 2018 to celebrate both international and local media’s contribution to building awareness of Malaysia’s healthcare travel industry. MTMA invites participants from both local and international media to submit their editorials within the duration from 3rd September 2018 to 30th June 2019. Participants stand a chance to win cash prizes and trophies worth up to MYR50,000. More details about MTMA can be found in www.mylovesyou.com/mtma2018. The awards ceremony took place on 22nd August 2019 and awarded 7 local and international media.

Familiarisation Visits

To increase visibility of Malaysia Healthcare and showcase service offerings to focus market stakeholders

Media

Media from Indonesia, Myanmar and Brunei Nepal Media FAM

Strategy Legend Core Pillar Legend Amplifying branding Facilitation and recognition Strengthen end-to-end Digital marketing value chain Enhance networks and Industry Sustainability relationships Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 73

Government Representatives Medical Professionals

Qatar officials visit Malaysia Healthcare Doctors from China visit Malaysia Healthcare

Healthcare Facilitators

Healthcare Facilitators from China Delegates attending Malaysian International Scientific Congress of Obstetrics and Gynaecology (MISCOG) visiting Sunway Medical Centre

Strategy Legend Core Pillar Legend Amplifying branding Facilitation and recognition Strengthen end-to-end Digital marketing value chain Enhance networks and Industry Sustainability relationships Malaysia Healthcare Chronicles 2009 - 2019: 74 A 10 Year Journey of Malaysia’s Healthcare Travel Industry How do we define Healthcare Travellers? Malaysia Healthcare defines ‘Healthcare Travellers’ in our own terms:

Health Tourists (HTo) Foreign Patients (FP) Tourist purposely flying Expatriates + Foreign to Malaysia for Workers + Foreign Healthcare Travellers (HT) treatment + Tourist Students + MM2H seeking treatment Participants during holiday

MM2H: Malaysia My Second Home

Source: MHTC Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 75

MM2H: Malaysia My Second Home

Source: MHTC Malaysia Healthcare Chronicles 2009 - 2019: 76 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 4: Malaysia Healthcare’s Performance: Key Insights

4.1 Key Market Trends and Industry Performance 4.2 The Healthcare Travel Economic Multiplier Effect 4.3 The Healthcare Traveller Profile 4.4 Key Insights into Malaysia Healthcare’s Performance by Market and State 4.5 Malaysia Healthcare’s Positive Impact on Local Healthcare 4.6 Milestones, Awards and Accolades Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 77

4.1 Key Market Trends and Industry Performance

Malaysia’s healthcare travel sector continues to grow strongly as measured by healthcare revenue growth and healthcare tourist arrivals. Following the switch in approach towards marketing and facilitating the industry (Refer Section 1.5), a significant growth spurt can be observed throughout the nation’s regions. For the year 2015-2018, Malaysia recorded a healthcare travel revenue of MYR4.8 billion, an 80% increase from MYR2.6 billion recorded for the year 2011-2014. Over the period of assessment, 2011-2018, the industry revenue recorded a CAGR of 15%.

Healthcare Travel Revenue

2011-2014 2015-2018 PERIOD 1 PERIOD 2 1.5 B 1.3 B 1.1 B 0.9 B 0.8 B 0.7 B 0.6 B 0.5 B

Image 4.1: Malaysia’s healthcare travel revenue 2011 2012 2013 2014 2015 2016 2017 2018 growth in Phase 1 and Phase 2

The sector is expected to maintain its upward revenue trajectory growth to achieve the desired target of MYR2.0 billion in hospital revenue by 2020. Malaysia continues to outperform while competing against global giants, with well-established healthcare travel industries that can draw upon larger resources and various other competitive advantages.

1.60 1.40

1.40 HT Volume: 9.4% CAGR 1.20

1.20 1.00 1.00 0.80 0.80 0.60

Revenue, RM Bil Revenue, 0.60 Mil Volume,

0.40 0.40

0.20 HT Revenue: 15.5% CAGR 0.20

0.00 0.00 2011 2012 2013 2014 2015 2016 2017 2018 Image 4.2: Healthcare traveller revenue and HTo Revenue HT Revenue HTo Volume HT Volume volume, 2011 -2018 Malaysia Healthcare Chronicles 2009 - 2019: 78 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Malaysia Healthcare’s Performance: Key Insights

The industry averaged a compounded annual growth rate (“CAGR”) of 9% and 15% for revenue receipts and traveller arrivals respectively over the past 10 years with the peak of 17% CAGR from 2015 – 2018, a commendable feat when measured against the APAC performance of 15% CAGR for the same period. This indicates that spending grew from MYR1,064 in 2015 to MYR1,200 in 2018. Healthcare traveller arrivals have been on the rise from 2011-2018.

Healthcare Travel Volume

2011-2014 2015-2018 PERIOD 1 PERIOD 2 1207 K 1050 K 921 K 881 K 882 K 859 K 728 K 643 K

Image 4.3: Malaysia’s healthcare travel volume growth 2011 2012 2013 2014 2015 2016 2017 2018 in Phase 1 and Phase 2

4.2 The Healthcare Travel Economic Multiplier Effect

Currently, the data collected to track the economic contribution of the industry is solely based on receipts from the private hospitals in Malaysia. It does not include receipts from primary care, ambulatory care, dental treatment receipts. Therefore, based on MHTC’s data in Image 4.1, the healthcare travel revenue in 2018 was MYR1.5 billion. However, according to the Departing Visitor Survey and Paid Accommodation Report by Tourism Malaysia, the healthcare travel revenue which includes hospital, pharmaceutical, dental and clinical receipts from tourists in 2018 was MYR2.86 billion.

4.2.1 Calculating the Multiplier Effect

Medical tourism industry brings in even greater economic impact to the nation if out-of-hospital spending by the patient and his/her accompanying travellers (family, friends and caregivers) are factored in. With a multiplier effect of 2.24 of MYR2.86 billion for spending on wellness, transport, accommodation, leisure and food, the healthcare travel industry has contributed a total of MYR6.4 billion to Malaysia’s economy in 2018.

In addition, healthcare travel extends to a wide spectrum of perhaps non-quantifiable benefits to the healthcare industry, the international accreditation sector and other sectors.

DIRECT IMPACT INDIRECT IMPACT Malaysia Healthcare Chronicles 2009 - 2019: • Spending on healthcare • Spending on medical A 10 Year Journey of Malaysia’s Healthcare Travel Industry 79 and hospitality devices industry • Foreign Direct Investment • Spending on retail, transport and other • Upgrade of medical tourism related activities facilities • Spending on medical • Spending on other technologies economic sectors (construction electricity, • Increase in professionals telecom, etc.) with sub-specialisation • Job creation in various sectors • Training of medical 4.2.2 Benefits personnelof Healthcare Travel

Apart from direct healthcare traveller revenue, the healthcare travel industry benefits the value chain in a variety Source: MHTC Informatics of ways while boosting the economy’s performance at the same time:

Spending on healthcare and hospitality, Upgrade/expansion/modernisation of Foreign Direct Investment medical facilities DIRECT IMPACT DIRECT

Training of medical personnel Spending on medical Spending on medical technologies devices industry INDIRECT IMPACT INDIRECT Spending on other economic Spending on retail, Job creation in various Increase in professionals sectors (construction transport and other sectors with sub-specialisation electricity, telecom, etc.) tourism related activities Source: MHTC Source: MHTC Informatics

Image 4.4: Direct and indirect impact of the healthcare travel industry towards the economy Malaysia Healthcare Chronicles 2009 - 2019: 80 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Malaysia Healthcare’s Performance: Key Insights

4.3 The Healthcare Traveller Profile

Malaysia is able to attract a large number of healthcare travellers due to the diversity of affordable treatments. The country has and continues to firmly position itself as the preferred regional destination for some specialised medical fields. These include: cardiology and fertility (please see Chapter Five for more information).

Following are the top treatments (in no particular order) that healthcare travellers look for in Malaysia and top 10 arrival countries: Orthopaedics

Fertility Top fields Cardiology Treatment Top 10 Country in demand of Origin

Oncology Neurology

Health Screening

Image 4.5: Top 10 country of origin for inbound healthcare travellers and top fields sought after in Malaysia

In terms of travellers by origin, Malaysia attracts healthcare travellers from many countries, not just within the region but also from nations regarded to have well developed medical systems and infrastructure.

Apart from the five core countries, Malaysia is also tapping other markets such as Bangladesh, Brunei and Singapore. Additionally, we also receive patients from other countries as per the aforementioned list.

The fact that Malaysia attracts patients from developed nations such as the United States (“US”), the United Kingdom (“UK”), Australia, Singapore and Japan, speaks volumes of the positive perception of trust and credibility that prevails for Malaysia’s healthcare industry. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 81

% Share of Healthcare Traveller Volume, 2011 and 2018

48% 52% 55% 45%

2011 HTO FP 2018

Image 4.6 : Health tourists and foreign patients’ contribution to healthcare traveller volume

A larger share of the health tourist segment in the healthcare traveller volume in 2018 compared to 2011 indicates that Malaysia is attracting more patients from abroad due to the overall quality of its healthcare sector.

4.4 Key Insights into Malaysia Healthcare’s Performance by Market and State

4.4.1 Traditional vs Non-Traditional (Greenfield) Market Performance

A more comprehensive view of Malaysia Healthcare’s performance emerges when looking at the industry from a market-by-market perspective. Malaysia’s healthcare travel sector has a mix of traditional and non-traditional or new markets in which the industry taps for international patients.

A traditional market is one where Malaysia has a long-established presence and traction as a healthcare destination and has entrenched strong perception of trust and credibility. There are also similarities in culture and close geographic proximity.

A non-traditional of greenfield market is one where the Malaysia Healthcare brand is yet to have fully established itself and more intensified efforts are required to grow the perception of trust among prospective healthcare travel patients. Malaysia Healthcare Chronicles 2009 - 2019: 82 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Traditional Market: Indonesia

From the 1990s, Malaysia has seen Indonesians flock to our shores for medical treatment, driven primarily by their trust in our healthcare system and the affordability of our quality care. Proximity and cultural similarities have supported this growth, and as the middle-class segment in Indonesia expanded, more Indonesians were able to access options beyond their own healthcare system. Beneficiaries in Malaysia were primarily Penang and Melaka hospitals due to strong connectivity, with source regions in Indonesia being Medan and the Riau Islands in general. From a treatment perspective, Indonesian patients were concentrated in diagnostics, and tended to seek higher value treatments elsewhere.

With 2014 recording a mere 3% growth in revenues, it was time for an intervention. Growing the Indonesia market posed a specific challenge – diversifying away from the original source regions and exploring not only new cities, but also encouraging higher value procedures and treatments as opposed to diagnostics. Establishing new target cities includes having to improve connectivity options (air and land transportation), and building awareness and trusts in segments that were already entrenched in other healthcare destinations.

Joint effort from the member facilities, supported by MHTC, in addressing this issue proved successful, with following years to-date showing consistent double-digit growth as high as 23% (2015). Of course, as the landscape changed, factors like the Indonesian National Health Insurance (BPJS) had to be addressed, and the industry in Malaysia continues to adapt and defend its position.

MHTC remains motivated to increase visibility on the quality of Malaysia Healthcare in cities and areas that may be unfamiliar (Jakarta, Surabaya etc.) as an option to other established healthcare destinations, as well as introduce and educate the population about new treatments and technologies. Even in these traditional markets, agility and responsiveness to change remains critical in securing future growth.

Non-Traditional (Greenfield) Market: China

China, due to its large population and challenges in their healthcare provision, has always been a market of interest for medical tourism. While MHTC had established an office in Hong Kong in 2013 as a strategy to penetrate China, the real breakthrough came in 2016 after the Chinese government announced the two-child policy. MHTC took the opportunity to showcase a single service, fertility, to cater to the estimated 90 million couples who were now eligible for a second child, with approximately half of that being of an age that would make natural conception difficult.

Challenges in establishing Malaysia Healthcare in China were considerably different from our traditional markets – awareness of Malaysia as a destination was very low, and significant amount of investments were needed just to raise visibility. Beyond that, MHTC also focused on partnerships for quicker and more efficient access to market as opposed to developing capacities organically. These collaborations proved to be a key factor in finally being able to establish Malaysia as a destination for fertility, with revenues from healthcare tourists doubling between 2017 to 2018.

Moving forward, greenfield markets like China will continue to need sustained investments of between 3-5 years before showing stable growth, with strategies tailored to approach each market uniquely. Critical in ensuring success in a new market will be in building the awareness and trust in Malaysia Healthcare, while developing the full end-to-end ecosystem including ease of connectivity and travel, language and cultural support, as well as strong referral networks with practitioners. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 83

4.4.2 Performance by State

Performance by Region: Northern

Penang

Penang has historically been a pioneer location for healthcare travel in Malaysia, even well before Malaysia began to actively develop healthcare travel as a new growth sector.

Penang’s healthcare travel revenue almost doubled from 2015 to 2018 compared to 2011 to 2014 as tabled below. The state evident a 90% revenue growth, valued at MYR1.0 billion, with a CAGR of 15% from 2011 to 2018, at par with the country’s performance. The boom of Penang’s healthcare travel industry was largely supported by healthcare travellers from Medan, Indonesia.

Penang’s healthcare travel industry growth by revenue

2015-2018 MYR2.10 billion PENANG 2011-2014 MYR1.10 billion

Image 4.7 : Penang’s healthcare travel industry growth by revenue

Penang’s Success Factors

Excellent Professional A Bona Fide Hospitals Collaborate Affordable Medical Care on Par with the Tourist Haven and Treatment At World World’s Best Strive for Success Class Standards

Image 4.8: Penang’s healthcare travel industry success factors Malaysia Healthcare Chronicles 2009 - 2019: 84 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Affordable Medical Treatment at World Class Standards

Penang offers some of the most affordable specialist treatments, not just compared to across the region, but also within Malaysia. This has proven to be a major factor in attracting healthcare travellers.

Penang has become a go-to location for various specialised treatments such as oncology, urology, cosmetic surgery, dermatology and dental work. This helps to further enhance Penang’s appeal as prospective patients benefit from not just attractiveness of price, but also ample choice.

Among Penang’s unique game-changing efforts in developing itself as a well-regarded healthcare travel location is the formation of a specialised agency, Penang Centre of Medical Tourism (“PMED”).

PMED consolidates the efforts of Penang private healthcare providers and ensures the local state healthcare travel industry continues to develop strategically.

Performance by Region: Central

There are by far more private healthcare providers including specialised fertility centres in the Central region as compared to other states with a wider range of medical services provided. In the last 10 years, the majority of the private healthcare providers in Kuala Lumpur and Selangor underwent an extensive renovation by adding new wings and refurbishing their existing premises to provide a seamless experience to the increasing number of patients. On top of that, the private healthcare providers also made substantial investments in acquiring new technology and introducing new treatment modalities.

Over the period of comparison as per table below, Selangor has seen a 300% growth in terms of total revenue, an increase valued at MYR0.46 billion. Despite scoring only 50% revenue growth between the period of 2011 to 2014 and 2015 to 2018, Kuala Lumpur recorded a revenue increase of MYR0.40 billion over the two periods. Kuala Lumpur remains as major contributor towards the Central region revenue share at 62%. CAGR of Central region’s revenue was 21% from 2011 to 2018, outperforming the industry average of 15% during the same time. Central region’s healthcare SELANGOR travel industry growth by revenue 2015-2018 MYR0.69 billion 2011-2014 MYR0.23 billion CENTRAL REGION 2015-2018 MYR1.10 billion

2011-2014 MYR0.70 billion

KUALA LUMPUR

Image 4.9: Central region’s healthcare travel industry growth by revenue Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 85

Realising the positive impact contributed by healthcare travel to the state’s economy, Selangor Tourism has established a Medical Tourism Unit that works hand-in-hand with MHTC to further grow the industry in Selangor.

In recognition of the contribution by healthcare travel, the tri-annual Kuala Lumpur Mayor Tourism Awards had introduced a category on Medical Tourism for the first time in 2017.

Performance by Region: Southern

Melaka

Melaka is one of the earliest states in Malaysia that promoted its private healthcare services to foreign patients, especially from Indonesia. Similar to Penang, Melaka is known as a popular tourist destination with many tourist attractions and its variety of local delights. It is easily accessible via ferry from the cities of Dumai and Bengkalis to Melaka as well as direct flight from Pekanbaru. Indonesian patients from other parts of the region travel to Melaka via flights to KLIA2, and arrive in Melaka via overland transport in less than 2 hours.

Melaka recorded a revenue growth of MYR0.13 billion, boasting a 60% revenue growth between 2011 to 2014 and 2015 to 2018, with a CAGR of 12% from 2011 to 2018, slightly lower than the industry average of 15% during the same period.

Melaka’s healthcare travel industry growth by revenue

MELAKA 2015-2018 MYR0.37 billion

2011-2014 MYR0.24 billion

Image 4.10: Melaka’s healthcare travel industry growth by revenue

The Government of Melaka via its Tourism Promotion Division is actively promoting Melaka as a preferred destination and launched Visit Melaka Year 2019 with the aim to receive 20 million tourists this year. The division has also been supportive in promoting healthcare travel, and collaborate closely with private hospitals in Melaka. The two gateways to Melaka, its international ferry terminal and airport, underwent considerable upgrades to ensure a pleasant patient experience from the moment they arrive. Malaysia Healthcare Chronicles 2009 - 2019: 86 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Johor

The private healthcare scene in Johor has flourished over the last 10 years since the inception of several new private hospitals. The wider range of options and services now available in the state are a pull factor for local and foreign patients to seek treatment in Johor.

Referring to the table below, Johor was able to generate an additional revenue of MYR97 million over the period, which is a corresponding revenue growth of almost 90%. The state’s revenue CAGR stood at 17% between 2011 and 2018, outperforming the industry average of 15% during the same period.

Johor’s healthcare travel industry growth by revenue

2015-2018 JOHOR MYR0.21 billion

2011-2014 MYR0.11 billion

Image 4.11: Johor’s healthcare travel industry growth by revenue

While the healthcare travel sector in Johor is driven largely by the private healthcare facilities, the state of Johor has taken several initiatives to ensure the industry’s sustainability. Part of the initiatives included developing a Masterplan on Johor Hospitality and Healthcare Hub in 2018. Other government agencies such as IRDA have also embarked in Afiat Park, an integrated medical hub, in Iskandar Puteri. This mixed development will grow into a regional health and wellness centre, attracting visitors from all over the country and Southeast Asia.

Commercial players like Forest City also play an important part in promoting the healthcare travel sector in Johor, in realising the vision of transforming it into a healthcare hub. They have strategically collaborated with MJ Group to establish a healthcare screening centre in Forest City in July 2017, which provides high quality services to the local community, tourists, and Forest City owners. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 87

Performance by Region: East Malaysia

Sarawak

While famous for its rich biodiversity and cultural elements, many are not aware that Sarawak is a healthcare travel destination in Malaysia.

Sarawak enjoyed a revenue growth of over 60% between 2011 and 2018, equivalent to MYR84 million, enjoying a revenue CAGR of 16% during the period, at par with the industry average of 15% during the same time.

Sarawak’s healthcare travel industry growth by revenue 2015-2018 MYR0.22 billion 2011-2014 MYR0.13 billion SARAWAK

Image 4.12: Sarawak’s healthcare travel industry growth by revenue

The state of Sarawak through its Ministry of Tourism, Arts, Culture, Youth and Sports (MTACYS) plays a vital role in the promotion of healthcare travel in Sarawak. MTACYS, in collaboration with MHTC, initiated the state’s Medical Tourism Committee in 2018, and has since organised a series of regular meetings involving various key stakeholders including private hospitals, government agencies (namely Immigration Department and Health Department), and other commercial players. This coordination meeting serves as a platform to discuss operational issues with the aim of providing workable solutions in improving end-to-end patient experience, and at the same time plan for future promotions. Malaysia Healthcare Chronicles 2009 - 2019: 88 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Malaysia Healthcare’s Performance: Key Insights

Sabah

Despite being a relatively new entrant to healthcare travel, Sabah has seen rapid growth in recent years. The growth of tourism in East Malaysia had led to bright new prospects for medical tourism to shine in Sabah.

Sabah experienced an exponential revenue jump between the period of 2011 to 2014 and 2015 to 2018, generating additional revenues of MYR27 million. This growth was a result of full-fledged hospital players in Sabah investing in new, extensive facilities and aggressively promoting medical travel. Motivated by the potential of the state’s healthcare industry ecosystem, healthcare providers and the state government worked in hand-in-hand earning a revenue CAGR of 91% from 2011 – 2018. Sabah’s healthcare travel industry growth by revenue

2015-2018 MYR0.030 billion 2011-2014 MYR0.003 billion SABAH

Image 4.13: Sabah’s healthcare travel industry growth by revenue

Sabah leverages on its existing strengths such as the exotic appeal of the many natural tourist sights, the unique culture of the indigenous ethnic groups of Borneo, the greenery and diversely rich flora and fauna and cultural / tourism events that are renowned the world over.

Key strategic thrusts for Sabah include:

• Promoting medical tourism in Sabah as one of the state’s economic drivers. • Promoting the state as a regional medical hub as an alternative to more established locations such as KL and Penang. • The state government has established more hospitals to ensure sufficient quality and accessible healthcare for all. • Enhanced private hospital facilities to provide better access to patients from Brunei, Indonesia and the Philippines. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 89

4.5 Malaysia Healthcare’s Positive Impact on Local Healthcare

Clearly, Malaysia Healthcare has a bright future and its benefits to the nation, the economy and society are evident.

The industry, from a fledgling venture continues to expand into a significant revenue earner and brand builder for the nation.

Financial and economic returns aside, the industry has enabled many private sector hospitals to meet excess capacity, to develop their brand and value propositions, to expand into new markets and raise their quality standards and more.

Importantly, industry growth has enabled private sector healthcare providers to keep their costs more affordable, which again benefits Malaysians. Thus, Malaysia Healthcare has contributed to meeting the Rakyat’s needs for quality, accessible and affordable healthcare.

With the private sector enhancing their value proposition to tap the growing international patient market, the ensuing result is the enhancement of services and treatment provided, improvements to infrastructure and medical equipment and more. Again, these have only translated into improvements in the quality of medical care provided to Malaysians.

In terms of job creation, the growing healthcare travel industry has enabled the creation of more than 15,000 skilled and even high-paying jobs. The result is the retention of highly skilled personnels and specialised local talents, which goes towards addressing Malaysia’s perennial issue of brain drain.

In effect, Malaysia Healthcare has contributed to the country’s growing international profile as a modern, progressive, socially stable and economically advanced country with first-rate infrastructure, systems and services.

Having come to our country and experienced world-class healthcare services, patients return with more positive and truer perceptions of Malaysia. The effect of word-of-mouth marketing then takes fold and the result is a progressive mindset shift among many people across the world towards Malaysia. Image 4.13: Sabah’s healthcare travel industry growth by revenue Case in point: among international medical circles, healthcare travel has reshaped perceptions of Malaysia with an increasing number of medical professionals now looking to Malaysia as an exemplary model for quality, affordable and accessible medical care.

Ultimately, the development of healthcare travel is self-serving to the local medical industry, the country and Malaysians. The end-benefits cascades to all stakeholders and with that, healthcare travel must continue to be prioritised as a key engine of growth for the nation. Malaysia Healthcare Chronicles 2009 - 2019: 90 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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MHTC Member Hospitals

Kedah Kedah Medical Centre

Kelantan KPJ Perdana Specialist Hospital

Klang Valley Advance Vision Eye Specialist Centre Life Care Diagnostic Medical Centre Alpha Fertility Centre* Manipal Hospitals ALPS Medical Centre Metro IVF Fertility Centre Ara Damansara Medical Centre* National Heart Institute* Assunta Hospital Pantai Hospital Kuala Lumpur* Avisena Specialist Hospital ParkCity Medical Centre* Beverly Wilshire Dental Prince Court Medical Centre* Beverly Wilshire Medical Centre* Pristine Dental Centre Cardiac Vascular Sentral Kuala Lumpur Prof Muhaya Eye & Lasik Centre Columbia Asia Hospital (Puchong) Sentosa Medical Centre Dentalpro Dental Specialist Centre Sri Kota Specialist Medical Centre DSS Dialysis Centre (DaVita) Subang Jaya Medical Centre* Fertility Associates* Sunfert @ Bangsar South* Gleneagles Kuala Lumpur* Sunway Medical Centre* Golden Horses Health Sanctuary Tawakkal Health Centre IMU Oral Health Centre The Tun Hussein Onn National Eye Hospital International Specialist Eye Centre (ISEC) Thomson Hospital Kota Damansara* KL Fertility Centre TMC Fertility & Women’s Specialist Centre KPJ Ampang Puteri Specialist Hospital* (Puchong Centre) KPJ Damansara Specialist Hospital* Topvision Eye Specialist Centre KPJ Klang Specialist Hospital Tung Shin Hospital KPJ Pusat Pakar Mata Centre for Sight UMSC Ambulatory Care & Specialist Clinic KPJ Tawakkal Specialist Hospital* White Dental Cosmetic Centre

Pahang KPJ Pahang Specialist Hospital Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 91

Penang Bagan Specialist Centre Genesis IVF & Women’s Specialist Centre Gleneagles Penang* Island Hospital* Loh Guan Lye Specialists Centre* Pantai Hospital Penang Penang Adventist Hospital* TMC Fertility & Women’s Specialist Centre (Pulau Pinang)

Johor Gleneagles Medini KPJ Johor Specialist Hospital KPJ Pasir Gudang Specialist Hospital KPJ Puteri Specialist Hospital Regency Specialist Hospital TMC Fertility & Women’s Specialist Centre (Johor)

Melaka Mahkota Medical Centre* Oriental Melaka Straits Medical Centre Pantai Hospital Ayer Keroh

Negeri Sembilan KPJ Seremban Specialist Hospital

Sabah Gleneagles Kota Kinabalu Jesselton Medical Centre KPJ Sabah Specialist Centre Tawau Specialist Polyclinics

Sarawak Borneo Medical Centre Normah Medical Specialist Centre Timberland Medical Centre * Elite Member Image 4.13: MHTC Member Hospitals Malaysia Healthcare Chronicles 2009 - 2019: 92 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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4.6 Milestones, Awards and Accolades 2009 2010 2011 2012 2013 2014

• Announcement • Healthcare • Healthcare • Malaysia • MHRO • Held Malaysia of the industry is travel industry Healthcare established in Healthcare Investment Tax placed under is highlighted Representative Hong Kong Business Forum Allowance (ITA) Entry Point as a key growth Office (MHRO) Project 4 of the sector in the opened in • MHRO • MCL established • Establishment National Key Tenth Malaysia Jakarta established in in PIA of MHTC Economic Area Plan Bangladesh (NKEA) • Malaysia • Establishment • Corporatisation International • Partnership of Advisory • ITA incentive of MHTC Health Tourism for Healthcare Council for healthcare Expo (MIHTE) Travel travel effective • Malaysia 2012 was held Excellence • Introduction from 1/1/2010 to Healthcare (PHTE) of criteria 31/12/2014 brand and logo • Malaysia programme and benefits is developed Healthcare’s commences for MHTC Call Centre was Membership • Launch of established • Malaysia Programme the Malaysia Healthcare Healthcare Concierge and magazine Lounge (MCL) established in KLIA

• MIHTE 2013 was held Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 93

2015 2016 2017 2018 2019

• Healthcare travel is • Healthcare travel • Malaysia wins IMTJ’s • MHTC shifts to • Visit Malaysia 2020 recognised as one is included in 11th Destination of the under the purview is announced, of the key export Malaysia Plan Year award of the Ministry of supporting Malaysia sectors under the Finance Healthcare’s very National Export • Visa application • MHTC wins IMTJ’s own Malaysia Year Council process expedited Cluster of the Year • MYR30 million of Healthcare Travel for healthcare award allocated to 20200 • International travellers from healthcare Medical Travel Myanmar and • Malaysia Healthcare travel industry • MCL established in Journal (IMTJ) Bangladesh hits 1 million in development during KLIA2 awards Malaysia healthcare traveller Budget 2019 with Destination of • Double tax deduction volume • Malaysia the Year Award for accreditation • Extension of ITA and International • Malaysia positioned double tax deduction Referral Centre • Establishment • Malaysia wins as Fertility and (MIRC) established of national data Destination of the Cardiology Hub of • eVisa (Medical) in China collection system Year Award from Asia introduced for faster IMTJ Awards visa processing • MIRC2 established in • MHTC Membership • Break out to China, China programme • MHTC wins IMTJ’s focussing on fertility • Ran first-in-the- introduces Cluster of the Year world Medical Travel • Malaysia identified categories and award • Malaysia Healthcare Media Awards as WHO preferred benefits participated in the hospitals • MHTC runs first UNWTO- Roundtable • MHTC signs MoU • MHTC wins IMTJ’s insigHT conference on Medical Travel with AirAsia • Hosted inaugural Cluster of the Year Industry Guidelines MTMA award • MHTC signs MoU • MHTC signs MoU with Malaysia • MHTC conducted with Ikatan Dokter • Received ranking • MHRO established in Airlines MAB medical travel Indonesia as top global Vietnam service capacity destination for • Malaysia Healthcare study for industry • Brand Health Study healthcare travel by • MHRO established in hits MYR1 billion in is conducted value by IMTJ Myanmar revenue • Break into Cambodia • Extension of ITA until • Meet-and-Greet and Qatar 2017 Service introduced at MCL • Launched Malaysia Year of Healthcare Travel 2020

• Opening of MIRC3 Malaysia Healthcare Chronicles 2009 - 2019: 94 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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HEALTHCARE TRAVEL AWARDS - MALAYSIA

The country’s top medical establishments have garnered numerous awards and accolades through the years. In the last few years, Malaysia has come out on top of several international healthcare and living ratings:

International Living (Global Retirement Index 2015, 2016, 2017, 2019)

• Malaysia - “Best Country in the World for Healthcare”

International Medical Travel Journal – Medical Travel Awards 2015 - 2018

2018 • Health and Medical Tourism: Cluster of the Year – Malaysia Healthcare Travel Council • Highly Commended: Health and Medical Tourism: Destination of the Year – Malaysia • International Hospital of The Year – Gleneagles Kuala Lumpur • International Specialist Patient Centre of the Year: Institut Jantung Negara (National Heart Institute) • International Cosmetic Surgery Clinic of The Year – Beverly Wilshire Medical Centre • International Fertility Clinic of the Year – TMC Fertility Centre • Best Marketing Initiative – Gleneagles Kuala Lumpur (Less Pain, More Gain – a Minimally Invasive Surgery Campaign) • Best Quality Initiative – TMC Fertility Centre • Highly Commended: Excellence in Customer Service – Gleneagles Kuala Lumpur

2017 • Health and Medical Tourism: Destination of the Year – Malaysia • Health and Medical Tourism: Cluster of the Year – Malaysia Healthcare Travel Council • International Hospital of the Year - Sunway Medical Centre • Best Marketing Initiative - Sunway Medical Centre • International Fertility Clinic - TMC Fertility Centre • Highly Commended: Best Quality Initiative – Sunway Medical Centre

2016 • Health and Medical Tourism: Destination of the Year – Malaysia • International Hospital of the Year – Sunway Medical Centre • International Cosmetic Surgery Clinic of the Year – Beverly Wilshire Medical Centre • International Fertility Clinic of the Year – TMC Fertility Centre • Best Marketing Initiative – Gleneagles Kuala Lumpur • Highly Commended: Medical Travel Agency of the Year – Malaysia Healthcare Travel Council

2015 • Health and Medical Tourism: Destination of the Year – Malaysia • Excellence in Customer Service – Gleneagles Kuala Lumpur • Best Travel Website of the Year – Ramsay Sime Darby Health Care • International Cosmetic Surgery Clinic of the Year – Beverly Wilshire Medical Centre Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 95

Asia Pacific Healthcare and Medical Tourism Awards (2017 – 2019)

2019 • Medical Travel Organisation of the Year in Asia Pacific – Malaysia Healthcare Travel Council (MHTC) • Medical Tourism Hospital of the Year in Asia Pacific – Sunway Medical Centre • Hospital of the Year Malaysia – Prince Court Medical Centre, Subang Jaya Medical Centre • Value Based Hospital of the Year in Asia – Gleneagles Hospital Penang • Fertility Service Provider of the Year – Alpha Fertility, TMC Fertility and Women’s Specialist Centre • Cardiology Service Provider of the Year – Institut Jantung Negara • Dental Service Provider of the Year – Pristine Dental Centre • Diabetes Service Provider of the Year – Penang Adventist Hospital, Prince Court Medical Centre • ENT Service Provider of the Year – Thomson Hospital Kota Damansara • Health Screening Provider of the Year – Gleneagles Hospital Kuala Lumpur • Integrated Healthcare Clinic of the Year – Pantai Hospital Kuala Lumpur • Neurology Service Provider of the Year – Sunway Medical Centre • Oncology Service Provider of the Year – Gleneagles Hospital Penang, Subang Jaya Medical Centre, Sunway Medical Centre • Ophthalmology Service Provider of the Year – International Specialist Eye Centre • Orthopaedic Service Provider of the Year – KPJ Healthcare, Prince Court Medical Centre • Paediatric Service Provider of the Year – Gleneagles Hospital Penang, Prince Court Medical Centre • Paediatric Cardiology Service Provider of the Year – Institut Jantung Negara • Urology Service Provider of the Year – Gleneagles Hospital Kuala Lumpur, Sunway Medical Centre • Women’s Health and Wellness Service Provider of the Year – TMC Fertility and Women’s Specialist Centre

2018 • Medical Travel Organisation of the Year – Malaysia Healthcare Travel Council • Medical Tourism Hospital of the Year in Asia Pacific – Sunway Medical Centre • Hospital of the Year Malaysia – KPJ Healthcare • Best New Hospital of the Year in Asia Pacific – Cardiac Vascular Sentral • Fertility Service Provider of the Year in Asia Pacific – Mahkota Medical Centre and TMC Fertility • Cardiology Service Provider of the Year in Asia Pacific – Institut Jantung Negara • Paediatric Cardiology Service Provider of the Year in Asia Pacific – Institut Jantung Negara • Oncology Service Provider of the Year in Asia Pacific – Sunway Medical Centre • Neurology Service Provider of the Year in Asia Pacific – Sunway Medical Centre • Orthopaedic Service Provider of the Year in Asia Pacific – KPJ Healthcare • Gastroenterology Service Provider of the Year in Asia Pacific – KPJ Tawakkal Specialist Hospital • Ophthalmology Service Provider of the Year in Asia Pacific – International Specialist Eye Centre • Best Health Screening Provider of the Year in Asia Pacific – Prince Court Medical Centre • Cosmetic Surgery Provider of the Year in Asia Pacific – Penang Adventist Hospital • Women’s Health and Wellness Service Provider of the Year in Asia Pacific – TMC Fertility and Thomson Hospital Kota Damansara (formerly known as Tropicana Medical Centre) • Diabetes Service Provider of the Year in Asia Pacific – Prince Court Medical Centre and Thomson Hospital Kota Damansara (formerly known as Tropicana Medical Centre) • Paediatric Service Provider of the Year in Asia Pacific – Prince Court Medical Centre • ENT Service Provider of the Year in Asia Pacific – Thomson Hospital Kota Damansara (formerly known as Tropicana Medical Centre) Malaysia Healthcare Chronicles 2009 - 2019: 96 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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2017 • 2017 Medical Travel Organisation of the Year – Malaysia Healthcare Travel Council • 2017 Malaysia Hospital of the Year – KPJ Healthcare Berhad • 2017 Cardiology Service Provider of the Year – Institut Jantung Negara • 2017 Orthopaedics Service Provider of the Year − KPJ Healthcare Berhad − Sunway Medical Centre • 2017 Fertility Service Provider of the Year − TMC Fertility Centre − Mahkota Medical Centre • 2017 Paediatrics Service Provider of the Year - Prince Court Medical Centre • 2017 Ophthalmology Service Provider of the Year - ISEC International Specialist Eye Centre • 2017 Dental Service Provider of the Year - Beverly Wilshire Medical Centre

2016 Global Health and Travel Consumers Choice Awards

• Cosmetic Surgery and Aesthetics Service Provider of the Year – Sunway Medical Centre • Hospital of the Year (Malaysia) – Sunway Medical Centre • Orthopaedics Service Provider of the Year – KPJ Healthcare • Paediatrics Service Provider of the Year – Prince Court Medical Centre • Cardiology Service Provider of the Year – National Heart Centre, Malaysia

2018 Frost & Sullivan Malaysia Excellence Award

• Fertility Clinic of the Year – Alpha Fertility Centre • Medical Tourism Hospital Customer Value Leadership Award – Mahkota Medical Centre • Healthcare CSR Company of the Year – Sunway Medical Centre

2017 Frost & Sullivan Malaysia Excellence Award

• Medical Tourism Hospital of the Year - Island Hospital

2016 Frost & Sullivan Asia Pacific Healthcare and Tourism Awards

• Travel Council of the Year – Malaysia Healthcare Travel Council (MHTC) • Hospital of the Year: KPJ Healthcare • Growth Excellence Leadership Award – Sunway Medical Centre • Healthcare Service Provider of the Year – IHH Healthcare Berhad • Patient Care Hospital of the Year – Ramsay Sime Darby Health Care Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 97

8th Annual World Medical Tourism and Global Healthcare Congress

• 2015 Public Private Partnership Medical Travel Destination of the Year Award

2011 – 2019 MasterCard-Crescent Rating Global Muslim Travel Index

• Top Country for Muslim Travel

Reader’s Digest Asia Gold Trusted Brand Award 2015 (Private Healthcare)

• KPJ Healthcare • Ramsay Sime Darby Health Care • Pantai Hospital Kuala Lumpur

Frost & Sullivan’s Malaysia Excellence Awards 2015

• Hospital of the Year – KPJ Healthcare • Medical Tourism Hospital of the Year – Mahkota Medical Centre • Health Screening Company of the Year – BP Healthcare Group

World’s Best Hospitals for Medical Tourists by the Medical Travel Quality Alliance (2013, 2014, 2017, 2018,2019)

• Prince Court Medical Centre

Last Updated: 1st July 2019 What’s the Future for Malaysia Healthcare Travel? “The healthcare travel industry of Malaysia holds much promise for the nation and patients from all corners of the world. Within us lies the potential to be a leading global example of how healthcare travel can support the country’s healthcare system while providing solutions to international healthcare challenges.’’

YBhg Datuk Dr. Noor Hisham Abdullah Director General of Health, Ministry of Health Malaysia

Malaysia Healthcare Chronicles 2009 - 2019: 100 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 5: TOWARDS A BETTER TOMORROW

5.1 Building the Future of Malaysia Healthcare 5.2 Outlook and Prospects Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 101

2021-2025

2019-2020

5.1 BUILDING the future2015-2018 of malaysia healthcare

Given the growing importance of Malaysia Healthcare to the economy, healthcare sector, and society, there is a need to continue driving sustainable progress. Key areas earmarked towards ensuring industry growth and sustainability are:

• Delivering seamless end-to-end healthcare travel journey experiences • Creating a steady stream of healthcare travellers while generating more industry opportunities • EmbracingSetting digitalisationthe Momentum of healthcare andAccelerate data analytics Growth Push for Excellence • Regulatory Support and • Tightening marketing strategy • Effective conversion through Framework for industry growth and tracking mechanism for effective marketing 5.1.1 • Delivering Introduce membership Seamless End-to-Endeffective Healthcare conversion Travel Journey• Establishment Experiences of International structure • Strengthen hospitals' and Referral Centres in focus • Amplify Malaysia Healthcare stakeholders' service markets Patients, branding as consumers of the travel experience,offerings are perhaps the most• Establish vital stakeholders Centre of Excellence in the eco-system. It is • imperative Strengthen that end-to-end the industry continues• Focusto place on distinctivepatients atbranding the core of allto boostindustry medical strategies services and the value chain. experience • Market diversification by • Data analytics for targetted • MHTC Expand together network with and member facilitiesexpanding and state base governments and growth will focusmarketing on strengthening the end-to-end value partnership markets • chain Reinforce towards digital enhancing marketing the industry’s• Improve existing data strong submission value andproposition of quality, affordability and accessibility • as Establish well as datatrust management and confidence. accuracy system Specifically, the focus would be on potential patients seeking specific treatments. Improvement will be centred on elevating patient care and patient experiences based on the following focus areas: Outcome-based programmes, centres of excellence, technology adoption and service excellence.

Centres of Outcome Based Excellence Programmes

MHTC Future Focus Area

Technology Service Adoption Excellence

Image 5.1: MHTC Future Focus Areas Malaysia Healthcare Chronicles 2009 - 2019: 102 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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5.1.2 Creating a Steady Stream of Healthcare Travellers While Generating More Industry Opportunities

Going forward, a key focus area is to attract more healthcare travellers from existing and new markets through a wide range of marketing and promotion channels. These would include traditional media as well as digital and social media to reach a wider target market across APAC and beyond.

The key unique selling points of quality, affordability and accessibility will be emphasised, as well as other factors such as cultural similarities, multilingual capabilities, ease of entry and more.

While Malaysia has achieved a strong level of trust, there needs to be constant reinforcement of patient confidence, which requires a detailed and honest overview of not just the customer experience but also of key components that inevitably contribute to the overall patient experience. These integral components have been identified as follows:

MEDICAL EXCELLENCE SERVICE EXCELLENCE

✔ Accreditation ✔ Soft skills

✔ Good clinical outcome ✔ Patient engagement ✔ Trained and competent ✔ Meet and greet services clinical staff ✔ Translators ✔ Medical research ✔ Grievance mechanism ✔ Continuing medical education ✔ Dietary/Cultural needs ✔ State-of-the-art technology

Image 5.2: Growth areas to build greater trust

To establish the quality care expected from To give a Malaysia distinctive brand Healthcare identity to Malaysia Healthcare

PARTNERSHIP FOR HEALTHCARE TRAVEL EXCELLENCE Enable bundled pricing strategy - Enable a flat rate promotion of covering all CoEs base on clinical related services performance, in a single care excellence, episode uniqueness and value Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 103

MEDICAL EXCELLENCE SERVICE EXCELLENCE

The attainment of excellence at both the medical and service aspects are necessary to reinforce the perception of Accreditation Soft skills trust and peace ✔of mind; the key values behind the Malaysia Healthcare brand.✔

Improvements can✔ certainlyGood clinicalbe made, outcome in particular across the various gaps✔ wePatient have identified engagement towards delivering a more satisfying and confident customer end-to-end experience. ✔ Trained and competent ✔ Meet and greet services Brand building will continueclinical to staff be emphasised with MHTC leading the effort as the champion and custodian of the Malaysia Healthcare brand. ✔ Translators ✔ Medical research ✔ Grievance mechanism Emphasising Outcome✔ Continuing Based Reporting medical education ✔ Dietary/Cultural needs The overarching✔ emphasisState-of-the-art in Malaysia Healthcare technology is patient safety and the outcome of medical treatment. Malaysia does not allow the use of patient testimonial for marketing promotion.

The emphasis on treatment outcome measurement has resulted in the initiation of the Partnership for Healthcare Travel Excellence (“PHTE”) Programme, a treatment outcome based measurement reporting to enable quality care to be benchmarked against global best.

To establish the quality care expected from To give a Malaysia distinctive brand Healthcare identity to Malaysia Healthcare

Image 5.3: Purpose of the PHTE Programme Malaysia Healthcare Chronicles 2009 - 2019: 104 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Offering a Holistic Healthcare Travel Journey

One of the often-overlooked aspects of healthcare travel is the travel aspects; that is the tourism component of healthcare travel. Often healthcare travellers may seek more than medical treatments or procedures. This may or may not include post-surgery rehabilitation, physiotherapy and recovery, wellness, holistic and traditional or alternative therapies and more.

Hence, MHTC continues to position Malaysia Healthcare beyond just hospitals, facilities, treatment, and technology; but to also encompass destination and wellness offerings.

Image 5.4: Malaysia Healthcare’s Wellness Offerings

States' Plans Moving Forward

On a state-level, states such as Penang, Melaka, Johor, Sabah and Sarawak have laid out detailed plans in moving towards becoming an international medical hub.

2019 announced as Visit Melaka Year in efforts to increase tourist arrivals and intensify promotion of Melaka as the country's main tourist destination.

State government will focus on improving services in the state’s tourism sector, upgrading infrastructures, promotional activities, partnerships with private sectors and developing new products in efforts to attract about 20 million tourists in 2019.

Development of Melaka’s first full-fledged health-tourism centre, Satory Sanctuary in the City at Bandar Hilir expected to be completed by 2020 to boost the state’s medical tourism industry.

Ongoing expansion of two of Melaka’s private hospitals to cater to the growing demand of healthcare travellers.

Image 5.5: Melaka's Plans Moving Forward Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 105

1 Medical Hospitals - 3 JCI and 11 MSQH accredited hospitals New 8,700 sq ft heart centre From a 3-storey building in 1973 to a Pledged MYR2 billion in 2017 to - Continue to explore completed in 2018 and new soaring 19-storey building completed expand its current 300-bed and expand oncology building with radiation in 2013 with CT and MRI scanners as capacity to 1,000 beds therapy in 2015 well as digital operating theaters

2 Medical Devices - Penang has 1/3 of medical device makers in 375,000 sq ft manufacturing facility at the Batu Invested MYR70 million to build its first factory Malaysia exporting Kawan Industrial Park in Penang aiming to grow outside of Japan to produce medical devices for MYR17.8 billion of medical by >10% per annum from 2019 and increasing to cardiac rhythm management, electrophysiology devises in 2016 400 personnel or ablation and cardiovascular surgery

3 Promotional Institutions

Source: Malay Mail “Japan Lifeline invests MYR70 million in Penang Science Park” 26 February 2018; The Star “Boston Scientific bullish on Penang plant” 7 February 2018; Penang Monthly “Medical Tourism: A billion-ringgit industry for Penang” October 2015;

Image 5.6: Penang’s Plans Moving Forward Malaysia Healthcare Chronicles 2009 - 2019: 106 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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Johor Puteri Bandar Dato’ Onn Specialist Hospital Specialist Hospital Specialist Hospital Coming Soon Coming Soon

KPJ-UTM Specialist Hospital

Pasir Gudang Specialist Hospital Coming Soon Coming Soon Coming Soon

T&CM Hospital

• Johor State Government has put in efforts to position Iskandar Malaysia as the healthcare hub.

• Several major well-established private-sector healthcare players are currently involved in this development. A number of new players with projects in the pipeline are also set to have significant impact on the state’s development, especially in two of Iskandar Malaysia’s development zones, Johor Bahru City Centre and Iskandar Puteri.

• The state has outlined Rancangan Struktur Negeri Johor 2015-2030 and Johor Tourism Masterplan 2014-2023: • Cater to the expected 14.5 million tourists (6.95 million in 2015) by 2030 through Tourism Development Clusters. • Target: 90% of all private hospitals offering healthcare traveller services by 2030.

Source: Iskandar Malaysia Regional Development (IRDA)

Image 5.7: Johor's Plans Moving Forward Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 107

• Establishment of Medical Tourism Committee chaired by Sarawak’s Ministry of Tourism, Arts, Culture, Youth and Sports with participation from private hospitals, government agencies, MHTC and travel associations.

• Launch of the Visit Sarawak 2019 campaign that carries the tagline “More to Discover”.

• The State, through Sarawak Tourism Board has geared up for an aggressive marketing campaign to bring Sarawak’s tourism industry to new heights including healthcare travel.

• The State also facilitated new air connectivity to Sarawak from countries such as China and Indonesia.

• The target set is to hit 5.2 million tourist arrivals in 2020.

Image 5.8: Sarawak's Plans Moving Forward

• Sabah State acknowledges the potential for Sabah to be a healthcare travel destination as it has private hospitals with world-class treatment facilities as well as award-winning spa centres.

• Proposal for a Sabah Health Tourism Council to formulate policies on healthcare to regulate and promote the health tourism industry, as well as to facilitate and monitor the growth of the industry.

• Proposed expansion and development of the Tawau Airport to cater to the influx of tourists from China and other countries.

Image 5.9: Sabah's Plans Moving Forward Malaysia Healthcare Chronicles 2009 - 2019: 108 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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5.1.3 Embracing Digitalisation of Healthcare and Data Analytics

While the idea of tapping data for insights is certainly not new, the extent to which Malaysia plans to pursue data mining and analytics perhaps distinguishes Malaysia Healthcare from our regional peers. This includes the creation of a one-stop data centre, The Malaysian Health Data Warehouse (“MyHDW”), a central repository for all medical related data, by Ministry of Health Malaysia.

Tapping cutting-edge technology and the latest innovations especially in key areas such as big data, cloud computing and the Internet of Things (“IoT”) towards enhancing services and offering a higher level of personalised customer end-to-end experience.

MALAYSIA HEALTH DATA WAREHOUSE (MyHDW)

Built based on Includes the Source of Single platform national health national Patient comprehensive with linkable and informatics Registry data structured comprehensive standards Information for query and data System analysis purposes

Image 5.10: MyHDW, a one-stop healthcare data centre by the government

The focus is to meet the diverse needs of timely health information provision and management, and act as a platform for the standardisation and integration of health data from a variety of sources. This allows for a trusted source of truth within a jurisdiction to be established which can be leveraged to better manage the health system, provide surveillance information and in addition, provide a valuable source of data for research.

The creation of such seamless data connectivity will require various parties to collaborate in the realisation of MyHDW. The data, which are anonymised, will be useful for the analysis of the healthcare travel industry and enhance our efforts in a more targeted manner. Malaysia’s private healthcare 46 sector has 1 out of 55 anchor cardiothoracic MHTC Member hospital: IJN surgery specialists Hospitals are and over 73 equipped for treating a wide range of cardiology 200 cardiologists related ailments Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 109

HEALTH INFORMATICS CENTRE

Healthcare Travel Data National Health Data Custodian Collection: Partners’ statistics; STATE HEALTH Centralised Data Qualitative statistics DEPARTMENTS Management Value add: Members Publication and Dissemination benchmarking Health Information Standards

Data Basis and Source PRIVATE Data Integrity and Relevance Ambulatory care and dental HOSPITALS • MoH implementation of Malaysia clinics to submit to MoH Health Data Warehouse (”MyHDW”)

PRIVATE AMBULATORY • Jointly promote the use of MyHDW for CARE CENTRE Integrity, Timeliness, Depth of Data, Standard Report to participating facilities Data Transparency Data Publication and Data Sharing PRIVATE DENTAL CLINICS Future Efforts Image 5.11: Tomorrow’s healthcare travel data measurement mechanics

MHTC, MoH and other industry stakeholders remain cognisant that data privacy remains paramount and that all efforts in harvesting data must be done with the strictest confidentiality and with patient consent.

Beyond Malaysia’s Personal Data Protection Act 2010 (“PDPA”), Malaysia, going forward will look to strengthen policies and programmes including legislation where required, to facilitate the digitalisation of healthcare while ensuring patient privacy and confidentiality as well as data integrity.

Image 5.12: The Malaysia Healthcare Travel Information System increases healthcare travel data collection efficiency Malaysia Healthcare Chronicles 2009 - 2019: 110 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

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5.1.4 Leveraging on Malaysia Year of Healthcare Travel 2020

In 2020, efforts to promote Malaysia will be intensified given that next year has been designated Malaysia Year of Healthcare Travel 2020 (“MYHT2020”).

With the tagline, “Experience Malaysia Healthcare”, the objective is to invite the world to personally discover why Malaysia’s healthcare travel sector is of world-class standard.

Beyond just treatments, infrastructure, equipment and technology, the campaign is positioned to also convey a personal touch and strong customer end-to-end experience that with all other elements, clearly showcases why the Malaysia Healthcare brand has a growing reputation for being a symbol of trust and peace of mind for patients.

The campaign has been developed to be aligned with Visit Malaysia 2020. MYHT2020 celebrates the importance of both health and relaxation towards enhancing the value proposition and reward of choosing Malaysia as one’s healthcare travel destination. This initiative is aimed at propelling Malaysia to the world stage as a reputable global healthcare travel destination, as well as to increase the economic impact contributed by both the health and tourism sectors.

MYHT2020 presents three key experiences, promising quality care for healthcare travellers’ peace of mind.

Seamless Patient Wellness Natural Experience Sanctuary Wonderland

Healthcare travellers can enjoy a Malaysia’s private hospitals A world-famous tourist destination, seamless end-to-end healthcare are certified by internationally Malaysia is a potpourri of distinctive journey experience in Malaysia. Upon recognised accreditation bodies, and colourful cultures, refreshingly arrival, healthcare travellers will including the Malaysia Society for real and down-to-earth. Blessed be greeted at the aerobridge by our Quality in Health (“MSQH”), Joint with beautifully diverse natural Malaysia Healthcare Concierge and Commission International (“JCI”) attractions and modern cities, the Lounge personnel. We take them and International Society for Quality country is complemented with top- through the fast-tracked immigration in Health Care (“ISQua”), reflecting notch infrastructure. baggage claim and host them at our their commitment in upholding high lounge until their hotel or hospital standards of quality care for their With three main races, i.e. Malays, transport receives them. patients. Chinese and Indians, as well as scores of tribal communities, Most Malaysians are at least For healthcare travellers looking Malaysia is a dazzling array of colours bilingual, with English being widely to recuperate, rejuvenate or and cultures; among them, the spoken throughout the country, thus inculcate a healthier lifestyle, our centuries-old Peranakan culture is a facilitating ease of communication private hospitals come equipped spectacular showcase of the country’s between patients, doctors and with facilities and centres for harmonious diversity in action – support medical staff. International rehabilitation and wellness. These blending two distinct traditions to Patient Centres are readily available centres offer a wide range of create a rich and unique heritage that at our private hospitals, to further wellness packages and provide continues to this very day. ease healthcare travellers’ journey. wellness treatments as well as healthy and healing cuisines amidst As a halal-friendly destination, At every step of the way, Malaysia invigorating surroundings. Malaysia offers halal medical Healthcare will be there to assist alternatives with easily available and guide healthcare travellers halal facilities and food. Here, where throughout their journey until they diversity is a way of life, we are return home. “Malaysia, Truly Asia”.

Image 5.13: Experiences offered through MYHT2020 Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 111

5.1.5 Giving Hope to Dreams: Malaysia as the Fertility Hub of Asia

In developing a differentiation for Malaysia and enhancing its value proposition, one of the key strategic thrusts going forward is boldly positioning Malaysia as the Fertility Hub of Asia.

The choice of fertility as a differentiation strategy is based on Malaysia’s inherent strengths in these medical fields, as well as a range of push and pull factors. This includes the high demand recorded in recent years for fertility and cardiology treatments from healthcare travellers that come from Malaysia’s focus markets: Indonesia, China, India, Vietnam and Myanmar.

With the removal of China’s one-child policy in 2015, there is a large and growing market of China nationals (approximately 90 million couples) seeking affordable fertility treatments. Of these, 40 million are over 40 years of age. Malaysia is best positioned to tap this demand given its inherent strengths, (affordability, accessibility, convenience, technology, etc.) and proven track record in fertility treatments is poised to tap this demand.

In 2017, an average of 6,000-7,000 IVF cycles were performed with the number expected to triple to 20,000 cycles by 2020 in Malaysia.

Only 23 fertility centres in the world are International Reproductive Technology Accreditation Committee (“RTAC”) certified, with five located in Malaysia.

Fertility facilities in Malaysia are equipped with state-of-the-art technologies i.e. third generation IVF – Next Generation sequencing, which results in higher degree of treatment efficacy.

Consistent with Malaysia’s reputation for affordability, fertility treatments in Malaysia are reasonably priced at USD4,000-USD5,000 per cycle.

Patients benefit from the inherent feature of Malaysia’s end-to-end model, where they can expect to receive top-quality care at every phase of their journey, from pre to post treatment.

Image 5.14: Malaysia’s unique proposition as the Fertility Hub of Asia Malaysia Healthcare Chronicles 2009 - 2019: 112 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 5 MALAYSIA HEALTH DATA WAREHOUSE Towards a Better Tomorrow (MyHDW)

The strong and growing demand for fertility treatments in Malaysia is likely substantially driven by Malaysia’s proven leading expertise and track record of success in both fields. Malaysia has an exemplary record of successful Builtclinical based pregnancies, on with oneIncludes in two the fertility patients reportingSource of successful pregnancies.Single platform national health national Patient comprehensive with linkable and MHTC is presentlyinformatics collating data from Registryall participating fertility centresdata structuredtowards developing a morecomprehensive accurate and standards Information for query and data comprehensive understanding of the demand for fertility treatments in Malaysia including number of patients, System analysis their originating nations, success rates and other key industry insights.purposes

With this, more targeted and effective methods can be developed to grow Malaysia’s positioning as the Fertility Hub of Asia.

5.1.6 The Heartbeat of Asia – Malaysia as Asia’s Cardiology Hub

As Malaysia positions itself as Asia’s destination for fertility treatments, a similar approach has been adopted for cardiology. In positioning Malaysia as “the Heartbeat of Asia”, the goal is to firmly entrench Malaysia as the leading choice for heart related treatments.

Once again, the choice of cardiology is based on Malaysia’s inherent expertise and experience in this medical field, which has been developed over a long period of time as well as the demand for cardiology related treatments that is on the rise across Asia and the world.

One of Malaysia’s leading differentiation factors is the long-standing existence of the highly acclaimed National Heart Institute (Institut Jantung Negara or IJN).

As a dedicated medical facility, IJN has been at the forefront of pioneering various cardiology related medical breakthroughs since its inception in 1992. IJN’s groundbreaking achievements have firmly placed Malaysia on the regional, if not the global map, as a centre of excellence for cardiology related treatment.

Other factors that contributes to Malaysia’s overall strength as Asia’s leading cardiology hub are as follows:

5.1.7 Focus Market Diversification Malaysia’s private healthcare 46 sector has 1 out of 55 anchor cardiothoracic MHTC Member hospital: IJN surgery specialists Hospitals are and over 73 equipped for treating a wide range of cardiology 200 cardiologists related ailments

Image 5.15: Malaysia Healthcare’s strength in cardiology Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 113

First heart centre in APAC region to perform successful ‘Bio-absorbable Pulmonary Valve (PV) Conduit’ implant on three children with congenital heart defect (the 5th, 6th and 7th patient in the world to undergo this surgery)

First in Asia Pacific to conduct first-in-man trials for the world’s smallest pacemaker, the Medtronic Micra Transcatheter Pacing System (TPS)

First in Asia to introduce Perceval Sutureless Valve

IJN HAS RECORDED First in South East Asia to use revolutionary stenting device, Bioresorbable AN IMPRESSIVE Vascular Scaffold (BVS) LIST OF F1RSTS First in the country to implant the Watchman device to reduce the risk of stroke in patients with Atrial Fibrillation (AF)

First in Asia to conduct non-surgical implantation of Prosthetic Heart Valve TAVI

First in Malaysia to implant the TPS in a pregnant patient

First in the world to perform first-in-man implantation of VenTouch System to treat heart failure and mitral valve regurgitation in 2014

First in Asia to use the Parachute Ventricular Partitioning Device for heart failure patients in 2013 (National Heart Institute)

Introduction of Mitraclip: non-surgical repair for leaking mitral valve

Image 5.16: IJN’s impressive track record Malaysia Healthcare Chronicles 2009 - 2019: 114 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 5

Towards a Better Tomorrow

Applying the lessons learnt and best practices of our regional peers, MHTC will amplify efforts to reach prospective healthcare travellers in new markets, such as Indonesia, China as well as Indochina.

However, beyond just looking at countries, MHTC will dive deep towards targeting potential patients, namely those in second tier cities in Indonesia, China as well as Indochina.

Second tier cities are often relatively underserved, with the local healthcare system and infrastructure not keeping on par with growing demands and have yet to be fully penetrated by competitors. Income levels among residents in second tier cities are also on the rise.

In addition, the population in these cities, being generally new to the concept of healthcare travel, are known to have less preconceived ideas as to a preferred destination or country. They also tend to be more cost conscious and given Malaysia’s relatively affordable cost for medical treatment, the country’s healthcare travel sector is well primed to benefit from penetration into these new markets.

Given these confluences of supportive factors, the time is ideal for the Malaysia Healthcare brand to be brought to these locations in Indonesia, China and Indochina.

5.1.8 Building Industry Sustainability

The government continues to play a leading role in facilitating industry development and sustainability by providing a slew of financial incentives towards assisting existing and new private healthcare service providers. The objective is to develop sufficient and sustainable industry capacity in the long-term and to ensure the continued progress of the healthcare value chain in Malaysia.

The government’s efforts are also being followed by leading private medical care providers in Malaysia. Established players such as Sunway Medical Group, KPJ Healthcare Group, Thomson Hospital Kota Damansara, IHH Healthcare, Sime Darby Ramsay and HMI Group have been actively upgrading or refurbishing their infrastructure including expanding existing facilities or building new ones.

Other forms of expansion undertaken towards enhancing capabilities include procurement of equipment, undertaking research and development activities, recruiting additional professional medical talents and more. Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 115

5.2. Outlook and Prospects

Given Malaysia Healthcare’s present revenue and patient volume performance, and the industry’s inherent unique strengths and competitive factors, the future is indeed promising for Malaysia to realise its ambitions of becoming a leading global destination for healthcare travel.

Clearly, as Malaysia seeks to develop its socio-economic potential to the fullest, the healthcare travel niche sector has become an exciting new growth engine for the nation.

Supported by macro trends as described in detail in Chapter Two, the industry is well poised to achieve greater heights. This is despite the prevailing challenges, which are only expected to intensify moving forward.

If anything, Malaysia Healthcare has exemplified resilience and innovation (through the strategies and plans of the various players across the value chain) to rise above the obstacles and to continue moving forward towards the realisation of 2019 and 2020 goals.

Spurred by ambitious but attainable targets for 2019, Malaysia Healthcare aims to achieve 25% growth – recording MYR1.8 billion in hospital revenues – with an estimated total economic impact of MYR8 billion. The revenue target for 2020 is to reach an excess of MYR2.0 billion. The healthcare travel revenue is projected to reach MYR4.6 billion with a total economic impact of MYR16 billion in 2025.

5,000 MYR4.6 bil

4,500

4,000 CAGR (2020-2025) +16%

3,500

3,000 Potential impact 2,500 to the economy in Millions MYR2.1 bil 2025 is MYR16 billion 2,000

1,500

1,000

500

– 2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f 2021f 2022f 2023f 2024f 2025f

Image 5.17: Malaysia Healthcare’s healthcare travel revenue growth projection towards 2025 Malaysia Healthcare Chronicles 2009 - 2019: 116 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

CHAPTER 5

Towards a Better Tomorrow

Malaysia’s confidence in achieving its 2019 and 2020 targets stems from past performance. Previously in 2015, a 23% revenue growth target was achieved, an achievement underpinned by a cohesive and strategic effort in promoting Malaysia as the preferred South East Asia (“SEA”) healthcare destination and venturing into other areas such as dental and wellness as well. Hence, with sufficient support, there is every reason to believe that Malaysia Healthcare can attain its 2020 target and continue its upward climb towards becoming a leading global healthcare destination. MHTC, the government and the many other stakeholders within the value chain will continue to collaborate closely towards enhancing the quality, affordability and accessibility of the healthcare travel sector.

2021-2025

2019-2020

2015-2018

Setting the Momentum Accelerate Growth Push for Excellence

• Regulatory Support and • Tightening marketing strategy • Effective conversion through Framework for industry growth and tracking mechanism for effective marketing • Introduce membership effective conversion • Establishment of International structure • Strengthen hospitals' and Referral Centres in focus • Amplify Malaysia Healthcare stakeholders' service markets branding offerings • Establish Centre of Excellence • Strengthen end-to-end • Focus on distinctive branding to boost medical services experience • Market diversification by • Data analytics for targetted • Expand network and expanding base and growth marketing partnership markets • Reinforce digital marketing • Improve data submission and • Establish data management accuracy system

Image 5.18: Healthcare travel industry strategic roadmap

In the recent years, the increasing healthcare traveller’s demand and expectation, the rising regional competition and the fortification of target markets’ own healthcare systems have demanded Malaysia healthcare travel industry to adapt quickly to this persistent change. Given the aggressive targets of MYR4.6 billion set for the industry by 2025 and the need to adapt to the evolving landscape, in July 2019, MHTC initiated the development of the Malaysia Healthcare Travel Industry Blueprint 2020-2025. The industry blueprint will detail out the initiatives that need to take place for Malaysia Healthcare to be more competitive and meet this target, and will function as a tool to garner collaboration amongst all stakeholders and players in Centres of the industry in order to build on our existing strengths and pave the way forward for the industry. Outcome Based Excellence Programmes Malaysia’s long-term vision is to be the leading global healthcare destination. Towards this end, MHTC remains committed to elevating Malaysia Healthcare to the desired leadership position on the world stage over the course of 2020 to 2025. MHTC Future Focus Area

Technology Service Adoption Excellence Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 117

#MHmenangsamasama #togetherwewin Malaysia Healthcare Chronicles 2009 - 2019: 118 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

GLOSSARY

Glossary of Terms and Abbreviations ACHS Australian Council on Healthcare Standards APAC Asia Pacific APHM Association of Private Hospitals Malaysia B2B Business to business CAGR Compounded Annual Growth Rate CEO Chief Executive Officer CHKS Caspe Healthcare Knowledge Systems CLMV China, Laos, Myanmar and Vietnam CME Continuing Medical Education DG Director General DDG Deputy Director General E2E End-to-end: Commonly used to describe the entire length of the healthcare travel industry value chain or to refer to the medical traveller’s journey as a patient from start to end. ENT Ear, Nose and Throat ETP Economic Transformation Programme: A strategic government led initiative to revitalise Malaysia’s economic engines of growth towards transforming the nation into a high-income nation centred on a knowledge and serviced based economy with the emphasis being on the cultivation of highly skilled local talent.

The ETP is part of the larger National Transformation Programme (“NTP”). eVISA (Medical) The issuance of an electronic VISA to inbound medical travellers to Malaysia for the purpose of seeking medical treatment. Healthcare Travel Act of travelling for the purpose of receiving treatment for a disease, ailment or medical procedure or well-being and recuperation. HIFU High Intensity Focussed Ultrasound HT Healthcare travellers IJN Institut Jantung Negara or National Heart Institute IL International Living: A US based monthly publication for subscribers detailing the best places in the world to live, retire, travel and invest. IMTJ International Medical Travel Journal: The world’s leading journal for the medical travel industry providing regular news, articles and updates on medical tourism and health tourism. IMU International Medical University Malaysia Healthcare Chronicles 2009 - 2019: A 10 Year Journey of Malaysia’s Healthcare Travel Industry 119

insigHT Malaysia Healthcare’s very own medical travel market intelligence conference that was kick- started in 2016 to attract international delegates and speakers within the industry and the larger eco-system. IRDA Iskandar Regional Development Authority ISQua International Society for Quality in Healthcare ITA Investment Tax Allowance IVF In-vitro fertilisation JCI Joint Commission International JIM Jabatan Imigresen Malaysia (Immigration Department of Malaysia) KPJ Kumpulan Perubatan Johor G2G Government to government Malaysia Healthcare The definitive brand name given to Malaysia’s healthcare travel industry towards creating an easily identifiable image and perception among a global audience. MATRADE Malaysia External Trade Development Corporation MCL Malaysia Healthcare Concierge and Lounge MEA Ministry of Economic Affairs MHRO Malaysia Healthcare Representative Office MHTC Malaysia Healthcare Travel Council MIDA Malaysian Investment Development Authority MIRC Malaysia International Referral Centre MITI Ministry of International Trade and Industry MLY Malaysia Loves You: Engagement campaign introduced as part of Malaysia Healthcare’s brand repositioning exercise. MMA Malaysian Medical Association MOF Ministry of Finance, Malaysia MOH Ministry of Health, Malaysia MOTAC Ministry of Tourism, Arts and Culture, Malaysia MoU Memorandum of Understanding MPC Malaysia Productivity Corporation MSQH Malaysian Society for Quality in Healthcare: A non-governmental and not-for-profit organisation responsible for promoting safety and quality in the provision of healthcare services in Malaysia. MSQH issues the MSQH Hospital Accreditation Standards to medical providers, which is accredited by ISQua (International Society for Quality in Health Care). MTACYS Ministry of Tourism, Arts, Culture, Youth and Sports (Sarawak State) MTMA Medical Travel Media Awards MyHDW Malaysian Health Data Warehouse MYHT2020 Malaysia Year of Healthcare Travel 2020 NKEA National Key Economic Area: Specific area(s) identified as economic engines of growth under the ETP. Healthcare travel was identified as one of the six entry point projects (EPPs) for the healthcare NKEA. Malaysia Healthcare Chronicles 2009 - 2019: 120 A 10 Year Journey of Malaysia’s Healthcare Travel Industry

GLOSSARY

Glossary of Terms and Abbreviations

NTP National Transformation Programme: A government introduced programme to revitalise the nation by addressing key national and social issues towards the creation of equitable prosperity, peace and progress by addressing key national issues such as corruption, security, cost of living, urban public transportation, rural basic infrastructure and more. PDPA Personal Data Protection Act 2010 PHA Penang Health Association PHFS Act 1998 Private Hospital Care Facilities and Services Act 1998 PHTE Partnership for Healthcare Travel Excellence PMED Penang Centre of Medical Tourism RTAC Reproductive Technology Accreditation Committee PPP Public Private Partnership: A unique form of government and private sector collaboration towards the realisation of industry and infrastructure development, where government provides regulatory and other forms of facilitating support, and the private sector responsible for attaining set KPIs and results. Pop. ratio Population ratio PV Bio-absorbable pulmonary valve Rakyat A Malay word directly translated as “people” or the citizenry. Commonly used to describe people of Malaysia when referring to the collective citizenry. SMX Share My eXperience: Malaysia Healthcare initiated social engagement campaign featuring Malaysians sharing their experiences in practicing good healthcare and the preventive measures they have undertaken in maintaining their health. STB Singapore Tourism Board TalentCorp A dedicated agency set-up by the Malaysian government to attract highly skilled and in demand overseas based Malaysian talent to return home to work in Malaysia. T&CM Traditional complementary medicine Tourism Malaysia A dedicated agency formed to drive tourism in Malaysia and to uplift the nation’s profile and image as a leading tourist destination across the world. TPS Transcatheter Pacing System WEF With effect from WOM Word-of-mouth UK United Kingdom UMSC University Malaya Specialist Centre UNDP United Nations Development Programme UNESCO United Nations Educational, Scientific and Cultural Organization UNWTO United Nations World Tourism Organization US United States USP Unique selling proposition Value Chain The colloquial term used to describe all parties within the entire healthcare travel industry and the specific roles they play at each stage. VM2020 Visit Malaysia 2020 YA Year of Assessment

Malaysia Healthcare Chronicles: A 10 Year Journey of Malaysia’s Healthcare Travel Industry

MALAYSIA HEALTHCARE CHRONICLES 2009 - 2019: A 10 YEAR JOURNEY OF MALAYSIA'S HEALTHCARE TRAVEL INDUSTRY

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