Health Tourism in the Context of Demographic and Psychographic Change
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1 The Business of Health Tourism Symposium Curtin University 13 February 2012, Perth Health Tourism in the Context of Demographic and Psychographic Change An Insight into Germany s Health Tourism Market A/Prof Christof Pforr A/Prof Cornelia Locher
2 Presentation Outline Germany A health care system under pressure» Contributing factors» Government response? Germany s health economy» Second health care market Health tourism in Germany» Growth market, particularly amongst 60+ What does this mean for Australia?
3 A Health Care System Under Pressure 31.3% increase in health related expenditure between 1995 and 2008 (Robert Koch Institut 2009, Statistisches Bundesamt 2009) 10 11% of Germany s GDP (Robert Koch Institut 2009) Contributing Factors Advancements in medicinal technology Number of people 65+ for every 100 people of working age: 32 in in 2060 Rising costs of health care services Demographic developments» Population shrinking» Population aging 82 Mio Mio
4 Demographic developments detrimental for German health insurance system Financed mainly by employer/employee contributions based on taxable income (~15%) Almost half of all health expenditure linked to 65+ age bracket Government Response? Initially, rising health insurance premiums Wave of health care system reforms:» Introduction of economic and market based elements» Liberalisation of many health services and privatisation of some treatment costs (Gerlinger 2010)
5 Parallel trend: Psychographic Change Increased health awareness and greater personal responsibility for own health across all sectors of society (but particularly amongst 65+) Health Care System Reform Psychographic Change Second Health Care Market Privately funded health related products and services 64 Billion (2008) (Kartte & Neumann 2008) 6% annual growth predicted until 2020 (Statistisches Bundesamt 2009) Significant dynamic factor for new economic and social growth
6 Germany s Health Economy Important plank of Germany s economic activities 15% of all employment (Hilbert & Kluska 2010) Change in public perception from welfare burden to dynamic economic growth factor Onion Model (IWT 2010) Primary health care providers Classic ancillary services Cross sectoral expansion of peripheral products and services
7 Health Tourism in Germany Booming segment of Germany s health economy Between 2002 and 2007: 31% growth in interest in health tourism, further increase of 82% forecast until 2020 (FUR 2010) Heterogenous market segment continuum ranging from wellness tourism to medical tourism
8 In general, senior market driver of tourism demand in Germany: 29% Market share (2007) (FUR 2008) 91% Increase in travel propensity in 70+ age segment ( ) (Grimm et al. 2009)» Substantial gains in post working life leisure time» More disposable income» Higher levels of education» Improved and prolonged levels of physical and mental mobility Seniors tend to value health and wellness particularly highly 60+ age bracket constitutes 35% of wellness tourism market (75% increase since 1999) (FUR 2008) In context of demographic change, predictions that health tourism will develop into future mega market (Opaschowski 2007)
9 How does this relate to the Australian experience?? Psychographic change also evident Different health care system (National Health Care System mainly financed through tax system), but similar cost pressures Advancements in medicinal technology Rising costs of health care services Demographic developments???» Population increasing: Approx. 22 Mio in 2010, 36 Mio predicted for 2050 (CW, 2010)» Population aging: 13.5% of population 65+ in % predicted for 2050 (CW, 2010) Number of people 65+ for every 100 people of working age: 13 in in in 2050 Germany: 32 in in
10 Australia s Response to these Challenges? Since mid 1990s strong decrease ( 11%) in public service provision Push for stronger uptake of private health insurance cover Howard government s carrot and stick approach: Stick Medicare levy (2.5% instead of 1.5% of taxable income) for higher income earners without private health insurance Carrot 30% government rebate on private health insurance premium All the right ingredients (based on Germany s experience) for expansion of the health tourism sector 10
11 Conclusion In both countries increasing potential for health tourism based on these developments...? Demographic Change Psychographic Change Health Tourism Health Care System Reforms Stage of the Industry 11
12 Thank you
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