Humankind is getting older. About 1 billion people alive today are over the age of 60. By 2050, the global 60+ population is set to reach 2 billion. Children born in the 21st century have over 50% chance of living past the age of 100.
As the population ages and the number of senior citizens increases, their way of life also changes. Seniors stay heathy for longer, are wealthier than younger people, and tend to travel more than ever before. At the same time, those in need of medical treatment increasingly look abroad; a significant segment also seeks to combine treatment with leisure and travel to popular destinations. These trends have created two enormous markets that did not exist in the not-so-distant past: senior and health tourism.
DiaNEOsis has partnered up with the Institute for Social and Preventative Medicine and a group of researchers coordinated by Professor of Social and Preventative Medicine at the National and Kapodistrian University of Athens Giannis Toundas to study the potential and development of senior and health tourism in Greece. The study analyzes the particular characteristics and different segments of these markets, examines best practices from other countries in attracting senior and health tourists, maps the Greek landscape, and estimates the potential benefit to the Greek economy of successfully competing in these markets.
How can we entice a higher number well-off retirees from Northern Europe to live in Greece part-time? How can we offer higher quality services to senior citizens who want to visit Greece, but have special needs around accessibility, security, and health services? How can we attract patients that wish to combine medical treatment with luxury travel? How can we take advantage of the hundreds of natural springs around the country, and how can we claim a piece of the ever-expanding pie of the global wellness tourism industry?
All of these questions are addressed in the full study—a short summary of its main findings follows below.
First, let’s begin with some preliminary questions:
1. Who is a senior citizen?
The definition of senior citizenry is not straightforward. Most international organizations (including this study) define “seniors” as those persons over the age of 55. Why this cut-off? As most researchers observe, it is the age where most people start planning ahead for the difficulties they will face as they get older. Although they might not currently face any of the problems that are associated with old age—and might not face those for decades—their attitude and behavior changes. However, this is not universally accepted. Others believe, for example, that consumption patterns among senior citizens do not shift before the age of 65. The European Union has set the limit at 63.9 years. Other institutions set it at 60, 65 or even 74. The World Tourism Organization defines as a “senior tourist” anyone over the age of 50. Empirical studies suggest that senior citizens feel on average 10 years younger. For the purposes of this study, we have set the cut-off at 55.
The members of the 55+ group have certain common interests that differentiate them from members of all other groups. First, as people age health issues become more frequent, common, and serious. On the one hand, seniors not only live longer but also live better. The average European is expected to remain healthy and active for 8,3 years after the age of 65—longer in Northern Europe. One the other hand, a significant number of older citizens—46% of those over 60—have some form of disability. The majority of persons over 65 suffer from a chronic disease. Thirty percent of persons over the age of 60 fall on average once a year or more. One in three suffer from some hearing loss. Chapter 3 of the study presents the ailments that afflict senior citizens.
Health concerns is not the only factor differentiating seniors from younger cohorts. Seniors in the West are, on average, better off financially than their younger compatriots. In all EU countries the average income at age 50 was higher than the average income for the population as a whole.
Senior citizens travel more than ever before. The only age cohort in Europe that is witnessing an increase in both the number of trips and the average cost per trip is that of those over 65. Senior citizens also travel differently. They travel more frequently, prefer long-haul destinations, and demand higher quality services. They stay longer and spend more when they get there. They comprise a group of travel consumers that a country like Greece, whose economy is heavily dependent on tourism, cannot afford to ignore.
2. What is the total addressable market?
This study examines two interrelated yet distinct categories: senior tourism and health tourism. Senior tourists belong to one of two categories: short or long-term visitors, with the latter either renting or purchasing real estate locally.
The first category is important—and big. About 18% of EU visitors in 2018 were over the age of 65. Over-65s are estimated to reach 26% of visitors by 2030 and 32% by 2050. This important segment of the market can be further broken down into two subcategories: healthy visitors and those in need of medical treatment. A big portion of senior travelers is in need of some form of medical support. Thus, they need the reassurance of quick and easy access to high quality medical services, even if they do not necessarily expect to draw upon those services during their visit. Despite the size of this market, only 6.1% of trips to Greece in 2016 were conducted by senior travelers.
The second category, long-term visitors can also be split into subcategories, depending on whether they lease or purchase a destination home. This group, which has also been dubbed “snowbird tourism”, is continuously growing and includes retirees from rich northern countries who choose to spend a portion of their time (usually the winter) in southern, warmer climates. 7.3% of European adults wish to live in Southern Europe after retirement. In Germany, that percentage is 9%; it reaches 15.3% in the UK. Today, 120,000 British citizens over 65 live in Spain—a population that has doubled over the past decade. The market forecasts are bullish: over 120 Europeans will retire in the next 20 years translating into demand in Southern Europe for 2.7 million houses.
Health tourism is another important segment, that contains three distinct subcategories: medical, therapeutic, and wellness tourism. The OECD defines medical tourism as the activity that occurs when “consumers elect to travel across international borders with the intention of receiving some form of medical treatment.” An estimated 5-14 million persons travel each year for medical reasons, generating tens of billions of euros of revenues for host countries. According to the Global Wellness Institute, an estimated 7% of local and international travel is pursued for medical and health reasons. In 2013 alone, Thailand attracted 1.3 million patients, Mexico 1 million, the USA 800,000, Singapore 600,000 and India 400,000. Turkey, with 42 internationally certified medical tourism hospitals, welcomed more than 600,000 patients. In comparison, Greece attracts no more than 85,000 medical tourists a year.
What are these visitors looking for? Mostly orthopedic services, cancer treatment, heart clinics, plastic surgery, neurological /neurosurgical services and fertility treatment. The average medical tourist in Greece is between 45 and 55 years old, has a mid- to high income, stays for seven days, and brings a companion—together, they spend 5,000 EUR, versus 1,500 EUR for the average tourist pair. A 2014 study showed that more than 500,000 residents of the four main countries of origin for Greek tourism have unmet medical needs that cannot be addressed domestically for reasons including high cost and long waiting periods.
The other two subcategories are relevant, but target broader cohorts of the general tourist market beyond the 55+ group. Therapeutic tourism is not exclusively geared towards patients, and offers specialized treatments (e.g. water-treatment, clay therapy, sea therapy, climate therapy, salt therapy, cave therapy, etc.) Wellness tourism is addressed to healthy persons and offers a multitude of ways of improving physical and mental health, including organized tourist activities centering around nutrition, fitness and mindfulness.
3. What are other countries doing? What is Greece doing?
Senior and medical tourism make up a significant chunk of the global tourism industry in both developing and developed countries. Many countries are developing new tourist products, invest in clinics that offer specialized nursing and support services to elderly patients, and offer complete health & leisure packages. The report showcases illustrative examples.
Various initiatives from governments, local municipalities and the private sector across European countries are moving in that direction. In Spain, for instance, the European Senior Tourism (EST) program attracts senior citizens from other EU countries during low season at competitive prices. The IMSERSO program subsidizes the improvement of tourist facilities so they can accommodate senior citizens or citizens with disabilities, while also funding programs for social tourism for seniors.
The situation looks different in Greece. We have yet to capitalize on our notoriously welcoming climate and beautiful natural resources, proximity to wealthy seniors from Northern Europe, and EU membership, to attract a significant segment of the senior and health tourism markets. Our comparative advantage extends beyond favorable location and natural resources to include an already mature tourist market and a competent labor force. Greece also has a high number of well-trained doctors—it has one of the highest ratios of doctors to inhabitants in Europe. It is also a safe country, with a high level of English language penetration, various tourist attractions and a high quality of life. In an InterNations study, Greece was named one of the top ten most attractive countries in the world to relocate permanently. One out of three senior visitors find the country better than they expected, while 20% comes back every year. Greece is also cheap relative to other developed nations, with a low cost of living, cheap real estate, and low cost of services. For instance, a liposuction costs $3,600 in Greece versus $26,200 in the US.
“Medical and therapeutic tourism can add approximately 13.6 billion EUR to Greek GDP and create 173,000 jobs over a five-year period. Wellness tourism, which addresses a younger cohort, can generate another 13.6 billion EUR and 171,000 jobs over the same period.”
Various obstacles stand in the way of realizing this potential. Our ageing Infrastructure is not geared to persons with limited mobility; public transport offers poor service; the public health system suffers from staff shortages and lack of adequate organization. Bacterial infections are highly prevalent in Greek hospitals; bacterial immunity is high. While we have many doctors, we lack qualified nurses. Red tape and complex zoning regulations pose barriers to investment in housing complexes. Taxation remains prohibitively high and few companies have experience delivering large scale projects. Only 6.1% of 4 or 5-star Greek hotels are able to offer medical care in-house. Only 25.2% of hotels have the specialized equipment in place to provide emergency care to senior citizens, despite the fact this is now a legal requirement. While there are 822 natural springs in the country, out of which 750 could be commercialized, only 123 relevant applications have been submitted to the Ministry of Tourism and only 48 have gotten approval. An even lower number provide modern facilities and equipment.
Some progress has been made. The newly-minted Greek Medical Tourism Council, is a NGO with private sector partners from health, tourism, insurance, and marketing sectors that is dedicated to promoting medical tourism. Similar efforts are spearheaded by the Greek Health Tourism Association the Greek Medical Association, and the Central Union of Municipalities of Greece. More specialized clusters are popping up, including the Athens Dental Tourism Cluster and the Athena Health Tourism Cluster.
In the private sector, six hotels stayed open on the island of Greece in 2018 to welcome around 50,000 retired Germans with Aegean Airlines flights from Germany, at the initiative of a German-Turkish company. A 2014 pilot program in Rhodes enabled the visit of seniors with severe health issues alongside their families by providing access to the highly specialized medical treatment they required. Fifteen German tourists with medical conditions participated in a primary care program accompanied by six nurses and two doctors. At the same time, a model cancer recovery unit including 250 hotel beds is being built on the island. Part V of the report illustrates comparable examples of wellness initiatives.
These glittering exceptions prove the less-than-stellar rule. If the state and the business sector took on the initiative to capitalize on this opportunity, the benefit for the economy could be immense.
4. What do we stand to gain?
According to the calculations of the research team, if everything fell into place (infrastructure, legal and regulatory setting, training and the full set of recommendations below), senior tourism, real estate sales and long duration stays, medical tourism and therapeutic tourism could add 13.6 billion EUR to Greek GDP and create 173,000 jobs over a five-year period. Wellness tourism, which addresses a younger cohort, can generate another 13.5 billion EUR and 171,000 jobs over the same period.
Capturing 15% of the market for second homes for retirees from Northern Europe could generate demand for 400,000 houses over the next 20 years. Sales (or long term rentals) of 20,000 homes, and with new owners spending on average 6 months in the country could contribute over 5 billion EUR to the country’s GDP annual and generate 60,000 new jobs.
These estimates, developed in part 5.2 of the study, arrive at the following conclusion: this is a huge wasted opportunity. Not to mention that the development of this particular market would have positive externalities for the whole of the economy—for every five holiday homes in Greece there is one new job created in hospitality services or gardening.
Long term visitors, e.g. retirees from Germany or Sweden, spend their foreign income and thus increase consumption without adversely affecting Greek’s balance of payments. In addition, the tourist sector stands to gain from a prolongation of the tourist season, tourist products will be upgraded and health facilities will be accessible for younger persons and locals, and other forms of tourism will also experience growth (ecclesiastical, historical, etc.) All this belongs in the context of an activities already developed here—as economist Aristos Doxiadis has pointed out, who also participated in this study—“we do not need big investments to make this happen. The issues are institutional and structural. We do not lack the (tourist) infrastructure or human resources.”
5. What we must do
The study offers a list of recommendations and tools, from a marketing analysis in particular industries (Chapter 4) to a mapping of relevant quality, safety and risk management standards (3.9). It provides the following steps for the development of a strategy for the development of senior tourism in Greece:
- Market targeting and segmentation of senior tourism
- Develop geriatric and therapeutic segments, including recovery services, chronic condition management and after-treatment from a cohort of special advisors
- Cluster creation for localities to holistically brand themselves as medical and senior tourism destinations
- Form destination branding & narrative creation for each destination
- Ensure the provision of necessary medical and nursing services in places of high value for medical tourism and long-stay senior tourism
The basic proposals concern the development of a favorable institutional framework out of a status quo that dissuades companies from taking on entrepreneurial risk. Since 2013, a common ministerial decision is in place setting in place a new regulatory environment for medical tourism (KYA 27217/2013), including provisions for medical certifications according to international standards, mandatory insurance for medical malpractice, the composition and maintenance of a database of medical providers, and accreditation of “medical tourism” hospitality providers from the National Tourism Organization (EOT in Greek). Nonetheless, the relevant implementing directives were never issued, and are still pending. The process of licensing touristic facilities also remains problematic.
The study also recommends:
- Changing the regulatory environment in order to allow for the construction of large scale housing complexes outside currently inhabited areas
- Decoupling elderly care and day nursing facilities from social welfare institutions in order to create opportunities for business initiatives to enter this space
- Improving services and facilities around transport, accessibility and security in high potential areas for senior tourism across the country
- Licensing medical facilities within hotels and other tourist units.
- Creating the conditions for the operation and availability of relevant services and facilities for the expansion of the tourist season outside urban centers
- Seeking and facilitating the certification of medical facilities by international standards
- Facilitating visa processing for senior long-term stays
- Creating relevant trainings for senior tourism personnel
- Creating a National Council of Health Tourism with representatives from tourism and health public bodies for the creation of a national strategy, the promotion of regulatory amendments and the organized promotion of the country as a senior and health destination.
The ministry of Tourism should continue to promote Greece as a top, safe destination 365 days a year. The National Organization for Tourism should continue to participate in international fairs for the promotion of long-stay/after-treatment tourism and make bilateral cooperation agreements such as the recent agreement with Russia in 2018. National health services must be upgraded, not only to serve senior visitors but also to better accommodate Greece’s own citizens. Local governments and regional administration can contribute by improving disability access in cities, particularly around points of interest for visitors, and showcasing their area as a destination for travelers. Regions, municipalities, and private actors can design holistic local packages from small enterprises across different sectors. Municipalities will need technical support and capacity building in order to entice investment and develop senior tourism services.
Read the full report with relevant analysis here: