The Healthcare Financing System in relation to Medical Tourism Development: Lessons from USA and Singapore for Health Policy Reform in Georgia

The study is about the role of the health care (HC) financing system in creating an institutional environment that is supportive for inbound medical tourism (MT) to develop sustainably, especially in the case of Georgia. Contemporary trends in medical tourism are driven by low-cost health care in developing countries. In order to reveal some of the factors that make for low costs and high quality care, the examples of medical care in Singapore and the USA are compared. This comparison then enables us to investigate the case of Georgia, and to find that the same factors that made Singapore a successful model can also apply in Georgia. The conclusion is that the low income status of developing countries is not the key explanation of why low medical costs can attract medical tourists. The extremely expensive USA HC is contrasted with the low cost of medical care in Singapore, and a similar potential in Georgia. Singapore is known for attracting record numbers of foreign patients for medical interventions. Four important factors of any low-cost and sustainable health care policy are identified through the study: (i) ‘third party payer’ elimination, (ii) universal HC coverage, (iii) benchmark prices controls and (iv) ‘basic care’ allocation to the public sector. None of these policies, however, can be effective without a strong and appropriately regulated public Health Care sector. Central to the logic of this study is that the findings of the comparative study have served as the basis for both an analysis of Georgia’s Health Care financing system at present, and for some recommendations, given that Georgia’s health care institutions are in the process of being reformed.