Medical tourism, or traveling to another country for medical care, is a growing business and has now attracted the attention of private investors. Sequoia Capital, a US venture capital firm based in Menlo Park, California, has invested in Saint Lucia Consulting Ltd, a Chinese company specializing in medical tourism. Saint Lucia, based in Beijing, brings Chinese patients to the US for treatment.
Sequoia Capital China and Beijing Saint Lucia Consulting signed an agreement last month in which Sequoia agreed to invest 50 million yuan ($8.06 million) in the Chinese company. The deal follows a trend of expanding the market for medical tourism. The investment is expected to enable more patients in China receive medical care in the US and other countries. Sequoia Capital China was not available for comment.
Saint Lucia Consulting is a member of the Medical Tourism Association (MTA) based in the US, a global non-profit association for medical tourism and international patients. Cai Qiang, founder of Saint Lucia Consulting, told the financial news magazine Caixin, as a member of the MTA, this allows the company to negotiate with foreign hospitals directly. Saint Lucia provides assistance to patients by sending employees on their tours to help them. Employees help patients with travel plans, medical records, and receiving approval from foreign hospitals. Only a few Chinese companies provide medical tourism overseas. Saint Lucia has signed agreements with top hospitals in the US, United Kingdom, Germany, South Korea and Singapore. The company has already worked with Massachusetts General Hospital in Boston and the Mayo Clinic in Rochester, Minnesota in the US, and Wellington and Royal Brompton Hospitals in the UK.
“The demand for overseas medical services will be great in the future,” said Zhou Kui, a partner at Sequoia Capital. The company carried out a review of Saint Lucia Consulting, sending specialists to carry out research at its overseas partner hospitals, Zhou told Caixin. “We do not expect the investment to provide a return in a short period,” he was quoted by Caixin as saying. “It targets long-term growth.”
The investment will help Saint Lucia provide more high-quality services, Qiang said, but it still might not be ready to expand quickly. Observers note that medical tourism has been popular in the US. The Centers for Disease Control and Prevention said on its website that up to 750,000 US residents travel abroad for medical care each year.
Paul Keckley, managing director at the Navigant Center for Healthcare Research & Policy Analysis in Chicago warns that “…the medical tourism industry lacks regulation,” especially outside of the US.”
Foreign patients coming to the US for treatment has been fairly stable and has been around for a while. Chinese businesses, or international businesses with employees in China, often come to the US for routine checkups, according to the Mayo Clinic. One reason Keckley believes many patients who need complex medical attention, including cancer and open heart surgery, come to the US is because of the 18,000 doctors trained yearly in the country, a third of them are from a foreign country. Saint Lucia is the largest overseas medical-service provider in China. It became a member of the MTA in 2011. In May the company signed an agreement with the Mayo Clinic to bring Chinese patients to the US for treatment. In the past five years, the number of Chinese patients going to the Mayo Clinic rose from 30 to 200, Melissa Goodwin, director of the clinic’s international office told Caixin.
Sequoia Capital set up its China operations with Chinese businessmen in 2005, and mainly focuses on technology, media, medical services and energy. So far the firm has invested in 150 companies. About 25 percent of the company’s investment goes towards healthcare, its second largest target sector.
Keckley is a member of the Health Executive Network and an advisor to the Bipartisan Policy Center in Washington. During the period preceding the passage of the Affordable Care Act, he facilitated sessions between the White House Office of Health Reform and major healthy industry trade groups. In the past, he worked at the Deloitte Center for Health Solutions and at Vanderbilt University Medical Center in Nashville, Tenn.