The idea of traveling around the world for medical treatment has captured much attention and imagination. As the debate on health care reform heats up in the United States, few weeks go by without a story about an under- or uninsured patient going to India or Thailand for heart surgery or hip replacement. Although medical travelers have many motives, lower-cost procedures and discretionary cosmetic operations represent only small segments. Most of these people seek the world’s most advanced technology, better quality, or quicker access to medical care.

To create a rigorous and credible fact base about the nascent medical-travel market, McKinsey studied more than 20 medical-travel destinations; analyzed primary data on the number, type, and origin of medical travelers; and conducted interviews with providers, patients, and intermediaries in 20 countries. We place the current market at 60,000 to 85,000 inpatient¹ medical travelers a year—numbers far smaller than others have reported.

These smaller numbers hinge in part on our strict definition of medical travelers: people whose primary and explicit purpose in traveling is medical treatment in a foreign country. We excluded from our study patients who receive care on an emergency basis (such as ordinary tourists who become sick), “wellness tourists” (for example, people traveling for massages or acupuncture), and expatriates seeking care in their country of residence. We also excluded patients who travel in largely contiguous geographies to the closest available care, for they don’t consider other medical-travel destinations and the financial burden is minimal.

Our examination of the motives and behavior of these patients reveals that this market has great potential for growth, though current volumes are modest. The benefits to providers attracting international patients are big—in addition to filling beds and increasing revenues per bed, such patients may boost an institution’s domestic prestige. But fewer than half of the international inpatients at the providers we visited were true medical travelers. Furthermore, several global forces and a number of important structural barriers may prevent or inhibit the market’s growth.

The fate of the medical-travel market has important implications for the financers of health services (governments, health insurers, and employers), the uninsured, providers trying to attract medical travelers from other countries, and providers in countries where medical travel originates. Removing barriers to it—such as the reluctance of large US insurers to include medical-travel destinations in their networks, the absence of transparency in quality and outcomes, the lack of clarity on malpractice jurisdiction, and the difficulty of obtaining travel authorization to some destinations—could increase and accelerate the flow of patients into the market. Health providers, payors, and third-party brokers have a substantial opportunity.