Service Evaluation Model for Medical Tour Service

Abstract

Medical tourism is a high-involvement and high-risk service. Because of these characteristics, consumers make decisions either by increasing benefit or by reducing risk. Therefore, there should be different decision-making procedures for different types of medical tour services. Consumers may perceive higher risk from significant treatment medical tour services, whereas lifestyle-related medical tour consumers may pay more attention to benefits. In this context, we propose a medical tour service evaluation model that reflects service characteristics and consumers’ involvement. From the results of this study, we drew meaningful marketing strategies for hospitals, travel agencies, and governments.

Keywords

medical tourism evaluation model high involvement intangible service benefit and risk

Introduction

Traveling overseas to receive medical services was once regarded as an exclusive luxury reserved for the affluent. However, decreased transaction costs and diversified country-specific medical specializations have popularized overseas medical tourism among consumers (Connell, 2006). When visiting a country, medical tourists stay longer and spend more than traditional tourists (Bennett, King, & Milner, 2004). Because of such attractive tourist behaviors, the governments of India, Malaysia, Thailand, and other countries focus on fostering medical tour services as part of their national strategic industries (Turner, 2007).

In academia, there also has been increased interest on the medical tour service industry. The research trend has been mainly in (a) the concept of medical tour service (Connell, 2006; de Arellano, 2007; Heung, Kucukustaa, & Song, 2010), (b) consumer behavior of medical tour service (Bennett et al., 2004; Ye, Hanqin, &Yuen, 2011; Yoo & Chon, 2008), and (c) market segmentation based on the types of medical tour services (Connell, 2006; Smith & Puczkó, 2010; Yu & Ko, 2012).

However, the existing body of literature seems to overlook some important characteristics inherent to medical tour services. The costly nature of medical services in general and the fear of receiving medical services in foreign countries cause consumers’ high involvement when purchasing medical tour services (Gruber & Frugone, 2011). Medical tour services are composed of a collection of intangible services. Consumers perceive higher risks from purchasing high-involvement products or services than from purchasing low-involvement products or services (Schoefer & Diamantopoulos, 2008). Also, consumers perceive higher risks from intangibility than from tangibility (Murray & Schlacter, 1990). As the medical tour service industry characteristically entails high risks, potential purchasers not only evaluate its benefits but also its risks.

On the other hand, the existing market segmentation research effectively demonstrates the diversity in the types of medical tour service. Scholars categorized the severity of medical tour services using three designations: (a) significant, (b) light, and (c) lifestyle-related treatments (Connell, 2006; Yu & Ko, 2012). Other scholars made the distinction between medical tour services and health tour services based on the degree of synthesis between medical treatments and tour services (Smith & Puczkó, 2010). Although, the market segmentation has successfully divided the medical tour services into specific types, it did not offer the service evaluation model suitable for each type. Without a tailored evaluation model for each type, medical tour service associates will remain challenged to map out a specific marketing strategy for each type of medical tour service.

The goal of this study is to propose a service evaluation model customized for the medical tour service industry. In order to represent the unique characteristics of the medical tour service industry (i.e., high involvement and intangibility), the proposed model will contrast consumers’ perceived benefits on evaluating a medical tour service to their perceived risks from the uncertainty in the service. Moreover, this study will explore the possibility of tailoring the evaluation model for each type of medical tour service by conducting an empirical test on one of the medical tour service types.

Conceptual Framework

Since the inception of the new millennium, the industry and academia have recognized a rising international trend of medical tour service. An estimated number of 5 million patients annually venture abroad to receive treatment for everything from cardiac surgery to facelifts, to dental work (Woodman, 2008, p. 8). Medical tourists collectively spend US$60 billion annually. This figure is estimated to rise to US$100 billion by 2012 (Ehrbeck, Guevara, & Mango, 2008). These numbers are remarkable as each medical tourist spends US$12,000 whereas each traditional tourist spends US$6,383 annually (World Travel & Tourism Council, 2011). In other words, these numbers indicate that medical tourists spend approximately twice as much money in the destination country than traditional tourists.

The governments of India, Malaysia, Thailand, and other countries support medical tour service as their national strategic industry to capitalize on the industry’s current popularity (Turner, 2007). To realize such strategic goals, governments, hospitals, and travel agencies need plans and methods that are customized and differentiated to medical tour service. Therefore, to develop such a tailored strategy, medical tour service associates should understand the factors that construct medical tour services.

Factors of Medical Tour Service

Industry experts attribute the rise in consumer interest to the combination of quality affordable health care and the pleasure of travel (Connell, 2006; de Arellano, 2007; Heung et al., 2010). The hospitality business and tourism management research have raised a variety of factors, which can characterize medical tour services. These factors could be organized into medical factors and tourism factors (Bowie & Chang, 2005; Connell, 2006; Cormany & Baloglu, 2011; Heung et al., 2010; Kim & Prideaux, 2005; Tsai, 2005). In addition, the facilitating conditions at the destination that influence medical tourists’ behavior have also been highlighted as a characterizing factor of medical tour service (Heung et al., 2010; Heung & Qu, 2000; Lunt, Hardey, & Mannion, 2010).

First, consumers consider medical factors, since receiving medical care is the main purpose. One of the main considerations customers make when shopping for medical tour service is the prospect for lower medical costs compared with the home countries (Connell, 2006). Consumers also consider the quality of medical services of the hosting countries. When evaluating medical tour services, consumers consider hospital facilities, physician reputations, and medical-team quality to compare with those of their home countries (Heung et al., 2010; Ye et al., 2011). Medical factors include not only affordable pricing and medical quality but also the service quality or patient-oriented operations of the hospital staff (Lunt & Carrera, 2010). Among the service operations criteria, waiting time for medical services has been shown to be one of the major problems that patients want to avoid (Heung et al., 2010).

Second, medical tour service consumers seek to enjoy tour services as well as to receive quality medical services (Bowie & Chang, 2005). Thus, tourism factors also are important factors of medical tour services. Family members usually accompany medical tourists when visiting the medical tour service destination and, for the family members, tourist attractions in the destination could play an important role (Cormany & Baloglu, 2011). Also, consumers evaluate accommodation facilities at the destinations. As medical tourists often have health issues, they tend to stay for longer periods than traditional tourists (Bennett et al., 2004). Although the price of accommodations is an important factor, the quality and proximity to hospitals are just as important for those traveling (Bowie & Chang, 2005). Moreover, the well-being or rejuvenating programs such as spa treatment services or environmentally friendly travel programs through the use of natural resources could be an added incentive for patients and their family members during the patient’s time of convalescence (Cormany & Baloglu, 2011; Kim & Prideaux, 2005).

Third, other than medical and tourism factors, consumers consider the facilitating conditions of the medical tour services at the destination countries. The hospitality of the destination government, medical tour service supportive policies, and national promotion of medical tour services are some of the factors, which allow for ideal facilitating conditions for medical tour services (Heung et al., 2010; Lunt et al., 2010). For instance, international traveler-friendly laws related to medical accidents and acceptance of foreign medical insurance policies may lower consumers’ concerns about the risks of receiving medical services in a foreign country. A simplified admission process to the country and one-stop transportation services from the airport to the hospital are some of the conditions that facilitate medical tour services (Lunt et al., 2010). Moreover, language differences have been the traditional problem in attracting international travelers (Magnini, Miler, & Kim, 2011). For medical tour services that involve having to explain and understand one’s health conditions, language interpretation is even more critical than for general tour services.

These major factors characterize medical tour services and the researches on those factors are organized in Table 1.

Table 1

Research Trend of Medical Tour Service Factors

	Medical Factors			Tourism Factors			Facilitating Condition
	Price Affordability	Medical Quality	Service Swiftness	Tourist Attraction Variety	Accommodation Appropriateness	Well-Being Program Availability	Simple Admission Process	Regulatory Support	Ease of Communication
Bowie and Chang (2005)			✓	✓	✓
Connell (2006)		✓	✓	✓	✓	✓			✓
Cormany and Baloglu (2011)	✓	✓		✓	✓	✓		✓
Heung and Qu (2000)				✓		✓	✓	✓	✓
Heung, Kucukustaa, and Song (2010)	✓	✓		✓	✓	✓	✓	✓	✓
Kim and Prideaux (2005)	✓			✓		✓
Lunt, Hardey, and Mannion (2010)				✓		✓	✓	✓	✓
Tsai (2005)	✓	✓	✓	✓	✓				✓

Types of Medical Tour Service

As medical factors, tourism factors, and facilitating conditions characterize medical tour services, the type of medical tour service differs depending on the emphasized factor. The existing research of medical tour service typology represents the diversity of medical tour service. Medical tour services could be categorized largely into five different types: (a) severe medical services involving spinal or cardiothoracic surgeries, (b) minor ailment services such as dental surgery, (c) aesthetic services such as plastic surgeries, (d) illness prevention services of cancer examination and overall health check-up services, and (e) convalescence tour services for rejuvenating one’s well-being (Connell, 2006). On a similar note, some scholars have identified the type of medical tour service based on the severity of medical treatments into significant treatments, light treatments, and lifestyle-related treatments (Yu & Ko, 2012). Other scholars took simpler approaches in dividing the types of medical tour service and health tour service based on the degree of synthesis between medical factors and tourism factors (Smith & Puczkó, 2010).

Although each type of medical tour service corresponds to consumers’ distinct wants and needs, research on medical tour service typology has stalled, simply subdividing the types of medical tour services. The types could serve as important foundations for developing medical tour service marketing strategy specific to each type. The type of medical tour service each country focuses on as their national strategic industry differs depending on the specific medical specialization each country excels. For example, based on its influential entertainment culture (i.e., the Korean wave), the South Korean government focuses its medical tour service around aesthetic plastic surgeries (Heung et al., 2010).

On the other hand, the Indian government focuses on marketing the affordability of significant medical treatments such as heart surgeries (Connell, 2006). As each type of medical tour service offers different utilities, the factors of medical tour services that appeal to consumers differ depending on the type. Therefore, it is necessary to develop service evaluation models specific to each type of medical tour service by understanding the specific factors that appeal to each type.

Evaluation of Medical Tour Service

On identifying the salient factors of the tour services, consumers evaluate and consider the factors that would be of most benefit to them (Roehl & Fesenmaier, 1992). However, the service evaluation should be more tailored to fit the distinct characteristics of the medical tour service.

Medical treatments have a direct effect on one’s health. Also, medical services in general are costly. Moreover, consumers feel the fear of receiving medical services in foreign countries. These service characteristics inherent to the medical tour service industry cause consumers’ high involvement when evaluating medical tour services (Gruber & Frugone, 2011). The high involvement also has its roots in the sociopsychological risk regarding unknown local conditions such as crimes targeting tourists, unfair laws against international travelers, and the fear of dissatisfaction about local accommodation facilities, travel contents, food, and so forth (Tsaur, Tzeng, & Wang, 1997). In addition, medical tour service is a service that is characterized by its intangibility (Murray & Schlacter, 1990). Littler and Melanthiou (2006) explained that perceived risk stems from the uncertainty in quality, which, only after the purchase, may be proven to be short of one’s expectations. In particular, such uncertainty has a tendency to be amplified when purchasing intangible services such as medical tour services (Kang, Cheon, & Shin, 2011). Therefore, by purchasing high-involvement and intangible services, consumers perceive higher risk than from purchasing low-involvement products (Reisinger & Mavondo, 2005; Tsaur et al., 1997).

As medical tour services portray high risks, consumers not only evaluate benefits that they can gain but also the potential consequences of taking on such high risks.Therefore, a more customized service evaluation model for medical tour services can be developed by examining the two conflicting decision criteria for perceived benefit and perceived risk (Kang et al., 2011).

After evaluating a medical tour service based on the aforementioned criteria, consumers perceive benefits or risks from the service. Then, based on the level of perceived benefit and risk of the service, consumers obtain a certain level of trust in the service quality (Coulter & Coulter, 2002). In other words, the level of trust in the service could serve as a concrete measurement for the quality of the service.

Consumers who had positive experiences with a particular tour service tend to recommend others to that service. Likewise, consumers who had negative experience dissuade others from using the service but at higher rate of intensity than those who recommend a service (Mattila & Ro, 2008). Because of the high-risk concern in medical tour services, potential consumers search for trustworthy medical tour services. They often turn to recommendations from acquaintances or friends who have had experiences with the services (Bigne, Sanchez, & Sanchez, 2001). The willingness to recommend refers to consumers’ willingness to provide positive information on a service that they experienced to their friends or acquaintances. Recommendation is a kind of positive word of mouth, which is extremely effective in persuading potential consumers of intangible services (Ferguson, Paulin, & Bergeron, 2010). Likewise, willingness to recommend is an important criterion for potential consumers’ evaluation for medical tour services (Feick & Higie, 1992).

Based on these observations, this study proposes a medical tour service evaluation model (see Figure 1). Specifically, we provide medical factors, tourism factors, and facilitating factors as the major configuring factors of medical tour services. From these factors, consumers evaluate a medical tour service and the evaluation influences consumers’ perceived benefit and perceived risk. The perception on benefit and risk determine the level of consumers’ trust in the service quality in the medical tour service being evaluated. Finally, the extent of trust influences consumers’ willingness to recommend.

Figure 1

Medical Tour Service Evaluation Model

Method

Sampling

To test the proposed research model, consumers who experienced medical tour services were surveyed. This survey was conducted in South Korea as it is a popular medical tour service destination for the light treatments (e.g., plastic surgery, dental care, acupuncture, etc.; Heung et al., 2010). Also, we selected the light treatment segment since it makes up the majority of medical tour service patients (Lunt & Carrera, 2010). To ensure respondents’ comprehension, respondents were given the choice of answering the questionnaire in the language that they were most comfortable with. The questionnaires were prepared in English, Japanese, Chinese, and Russian.

Prior to finalizing the questionnaire, we carried out a pretest to ensure that there were no mistakes in the measurement items. A pretest of the questionnaire was performed on 30 medical tourists in South Korea. The pretest respondents were volunteers not aware of the objective of the study. They were requested to complete the questionnaire in regard to the aforementioned 13 constructs. We modified the questionnaire based on the mistakes from language interpretations found.

The final questionnaires were deployed in 36 hospitals, which host international patients through medical tour programs. These hospitals range from small- and midsized hospitals to university hospitals, including dental clinics, oriental clinics, ophthalmic clinics, and other specializations conducting light treatments. We sent paper-based questionnaires to international patient coordinators of each hospital and had them conduct the survey on their patients. From the 36 hospitals, 220 patients participated in answering the questionnaire. Among the 220 returned questionnaires, 41 were dropped because of missing data and 13 were disregarded since they visited for more well-being purposes such as laser teeth whitening operations at dentists and meridian massage therapies at oriental clinics for body shaping. A total of 166 patients completed all parts of the questionnaire, which were included in our analyses.

Constructs and Measurement Items

In this study, there are a total of 13 constructs and 43 items. Respondents were asked to express their level of agreement with the items based on a 5-point Likert-type scale with anchors ranging from 1 = strongly disagree to 5 = strongly agree.

Three items to measure price affordability were derived from consumers’ price concept in Tsai (2005). Medical quality was assessed by developing three item questions based on Heung et al. (2010). To measure service swiftness, concepts from Connell (2006) were used. The simple admissions process was assessed with three items developed using the findings in Heung and Qu (2000). To test the ease of communication, three questions were generated based on the concepts from Lunt et al. (2010). Also, regulatory support was measured using three-item questions developed based on Heung et al. (2010). Items measuring the tourism variety were developed from Kim and Prideaux (2005). Measures of accommodation appropriateness were developed based on the concepts introduced in Bowie and Chang (2005). Well-being program availability was assessed by developing three-item questions based on Cormany and Baloglu (2011). To measure perceived benefit, concepts from Roehl and Fesenmaier (1992) were used. The measurement items asked respondents of their general satisfaction of the medical tour service in multiple perspectives including price affordability, medical quality, and the value of the service. Perceived risk was assessed with four items developed using the findings in Reisinger and Mavondo (2005) and Tsaur et al. (1997). The measurement items reflected the concerns that consumers have toward medical tour services such as medical accidents, cross-contamination, crime, and the quality of medical treatment (Reisinger & Mavondo, 2005; Tsaur et al., 1997). To test trust in the service quality, four questions were generated based on the concepts from Coulter and Coulter (2002). Finally, willingness to recommend was measured using four-item questions developed based on Ferguson et al. (2010). The measurement items and literature sources are organized and displayed in Table 2.

Table 2

Measurement Items

Constructs	Measurement Items	Researcher(s)
Price affordability	For its quality, the price of this medical tour service is reasonable.	Tsai (2005)
	This medical tour service is not overpriced compared with its competitors.
	I will not be overburdened for paying the price of this medical tour service.
Medical quality	This hospital is internationally known for the medical service I will be receiving or received.	Heung, Kucukustaa, and Song (2010)
	The medical team of this hospital is reputable for their skills.
	This hospital is certified in international medical standards (e.g., JCI).
Service swiftness	Service swiftness for the medical service from this hospital is shorter than from institutions in my home country.	Connell (2006)
	Immediate medical service is possible at this hospital.
	Less time is wasted at this hospital than at the hospitals in my home country.
Simple admission process	Immigration process of this country is simple.	Heung and Qu (2000)
	Receiving documents for medical service needed for immigration procedure is simple at this hospital.
	The staffs of this hospital are well versed in administrative processes needed for immigration.
Ease of communication	This hospital provides language interpretation/ translation service in my language.	Lunt, Hardey, and Mannion (2010)
	I can communicate in my mother tongue with the medical staff at this hospital.
	My family can communicate with this hospital staff through e-mail or phone from home country.
Regulatory support	This hospital has legal and systematic measures for protecting foreign patients’ rights during medical accidents.	Heung et al. (2010)
	This hospital has systematic compatibility with the medical insurances in my home country.
	This hospital protects my personal medical information.
Tourist attraction variety	This medical tour service includes a variety of cultural activities.	Kim and Prideaux (2005)
	This medical tour service includes tourist attraction visits, site seeing, and entertainments.
	This medical tour service offers rich dining experiences.
Accommodation appropriateness	The accommodation I am or my family is staying at is generally clean.	Bowie and Chang (2005)
	The accommodation I am or my family is staying at is close to the hospital.
	The accommodation I am or my family is staying at has good service quality.
Well-being program availability	This medical tour service offers nonmedical programs as a supplementary treatment for my illness.	Cormany and Baloglu (2011)
	This medical tour service offers nonmedical programs to enhance the recovery.
	This medical tour service includes nature visits for my health.
Perceived benefit	This medical tour service offers services that are valuable for me.	Roehl and Fesenmaier (1992)
	This medical tour service offers me much economical benefit.
	I am satisfied with this medical tour service.
	There are a lot to gain from this medical tour service.
Perceived risk	I am worried about medical accidents from this medical tour service.	Reisinger and Mavondo (2005); Tsaur, Tzeng, and Wang (1997)
	I am worried about cross-contamination from this medical tour service.
	I am worried about being the target of crime in the hosting country from this medical tour service.
	I am worried about receiving medical serve that is lower quality than what I paid for.
Trust in the service quality	I can trust this medical tour service.	Coulter and Coulter (2002)
	I feel safe with this medical tour service.
	The medical tour service provider is dependable.
	The medical tour service provider provides promised service.
Willingness to recommend	I will speak well of this medical tour service to my relatives, friends, and colleagues.	Ferguson, Paulin, and Bergeron, (2010)
	When others ask me about medical tour service, I will recommend this medical tour service first.
	I will recommend this medical tour service to others.
	I will not speak ill of this medical tour service to my relatives, friends, and colleagues.

Analysis

This study used partial least squares (PLS) to estimate the proposed model and the measurement scale. Within various structural equation model testing tools, PLS was chosen over LISREL or AMOS because this study aims at theory development instead of theory testing. PLS is a method to estimate the structural equation such as LISREL, and AMOS. It is the nonparametric statistics that do not assume the normality of the distribution. Thus, it is a little different in interpreting the results of LISREL, and AMOS which use goodness-of-fit index (GFI), adjusted goodness-of-fit index (AGFI), normed fit index (NFI), and comparative fit index (CFI) compared with using the composite reliability (CR) or R² in the PLS (Son & Benbasat, 2007). The structural model examines the significance of the relationship among the independent and the dependent factors of the research model. Similar to linear regression, an R² in the PLS analysis provides the strength of the overall model. Path coefficients in the structural model specify the strength of each individual relationship. The support, or lack thereof, for the hypotheses is provided by the size and direction of the path coefficient and is reported with the p value.

The PLS approach to structural equation modeling was used to validate the measures and to test our research model, using SmartPLS. Given the ability to model both formative and reflective latent constructs under small- and medium-sized samples, the PLS approach such as LISREL was used (Son & Benbasat, 2007).

Findings

Sample Characteristics and Correlations

Among the 166 respondents, there was an almost even split between male and female respondents with 80 male (48.2%) and 86 female (51.8%). Approximately 75% of respondents were between the ages of 20 and 30 years, which represents the most frequent users of light treatment medical tour services (Jenner, 2008). Also, there was a diverse geographic range represented in the survey with 46 patients from North America (27.7%), 38 patients from Europe (22.9%), and 62 patients from Asia (37.4%). Among the information search methods for the medical tour service, Internet searches, such as visiting home pages of travel agencies, hospitals, and KTO (Korean Tourism Organization), were the most popular. The demographic characteristic of the sample population is organized as follows (see Table 3).

Table 3

Demographic Characteristics

Item	Type	Frequency	Ratio (%)
Gender	Male	80	48.20
	Female	86	51.80
	Total	166	100
Age (years)	<20	8	4.80
	20s	68	41.00
	30s	56	33.70
	40s	24	14.50
	50s	10	6.00
	Total	166	100
Nationality	China	14	8.40
	Southeast Asia	22	13.30
	Japan	26	15.70
	Europe	38	22.90
	North America	46	27.70
	Others	20	12.00
	Total	166	100
Major information search route	TV	10	6.00
	Korean Tourism Organization homepage	18	10.80
	Recommendation by others	26	15.70
	Travel agency homepage	32	19.30
	Hospital homepage	38	22.90
	Newspapers and magazines	42	25.30
	Total	166	100

The mean, standard deviation, and correlation matrix appear in Table 4. Out of all mean values among each construct, the mean of perceived benefit is the highest with 3.74, whereas perceived risk is the lowest with 2.68. Well-being program availability shows the highest correlation with accommodation appropriateness of .63. Details on the correlations among constructs are tabulated in Table 4.

Table 4

Correlations Among Constructs

	PA	MQ	SS	SA	EC	RS	TV	AA	WA	PB	PR	TS	WR
PA	1
MQ	.39**	1
SS	.42**	.56**	1
SA	.33**	.41**	.46**	1
EC	.40**	.53**	.45**	.55**	1
RS	.20	.40**	.27*	.30**	.34**	1
TV	.33**	.40**	.31**	.43**	.39**	.40**	1
AA	.27*	.41**	.23*	.26*	.26*	.38**	.48**	1
WA	.23*	.37**	.32**	.25*	.25*	.29**	.49**	.63**	1
PB	.54**	.42**	.56**	.43**	.48**	.37**	.62**	.46**	.53**	1
PR	−.39**	−.29**	−.18	−.24*	−.44**	−.17	−.27*	−.12	−.05	−.45**	1
TS	.46**	.49**	.28**	.46**	.56**	.38**	.43**	.24*	.22*	.48**	−.62**	1
WR	.41**	.51**	.40**	.51**	.55**	.40**	.50**	.43**	.35**	.60**	−.47**	.53**	1
Mean	3.56	3.48	3.52	3.55	3.46	3.53	3.7	3.5	3.68	3.74	2.68	3.44	3.57
SD	0.99	0.64	0.75	0.72	0.75	0.7	0.54	0.63	0.62	0.79	0.93	1.04	0.74

Note. PA = price affordability; MQ = medical quality; SS = service swiftness; SA = simple admission process; EC = ease of communication; RS = regulatory support; TV = tourist attraction variety; AA = accommodation appropriateness; WA = well-being program availability; PB = perceived benefit; PR = perceived risk; TS = trust in the service quality; and WR = willingness to recommend.

p < .05. **p < .01.

Measure Validation

The reliability of this study is sufficiently demonstrated since Cronbach’s alpha indexes are all greater than .70, CRs are greater than .70, and average variance extracted (AVE) values are greater than .65.

In the case of PLS data analysis, convergent validity is assessed by the item’s loading on its corresponding construct. Convergent validity is assessed by (a) reliability of items, (b) CR of constructs, (c) AVE, and (d) factor analysis results. Examining each item’s loading on its corresponding construct assesses the reliability of items. Barclay, Higgins, and Thompson (1995) suggest that, as a rule of thumb, the item loading should exceed .70. In this study, the loading of each item meets this criterion (see Table 5).

Table 5

Confirmatory Factor Analysis Results

Constructs	Measurement Items	Loading	SE	t-Value	Cronbach’s α	CR	AVE
Price affordability	PRCA1	0.94	0.01	81.21**	.93	.95	.87
	PRCA2	0.95	0.01	102.61**
	PRCA3	0.91	0.02	58.33**
Medical quality	MEDQ1	0.8	0.05	16.60**	.83	.9	.75
	MEDQ2	0.89	0.02	38.83**
	MEDQ3	0.90	0.02	36.99**
Service swiftness	SWFT1	0.91	0.02	37.84**	.93	.95	.87
	SWFT2	0.95	0.01	88.43**
	SWFT3	0.94	0.01	69.64**
Simple admission process	SIMP1	0.83	0.05	18.44**	.84	.9	.75
	SIMP2	0.89	0.03	34.68**
	SIMP3	0.88	0.02	35.64**
Ease of communication	COMM1	0.92	0.02	55.63**	.92	.95	.87
	COMM2	0.95	0.01	82.83**
	COMM3	0.92	0.02	44.67**
Regulatory support	RGSP1	0.84	0.04	21.67**	.85	.91	.77
	RGSP2	0.93	0.02	53.06**
	RGSP3	0.85	0.03	28.02**
Accommodation appropriateness	ACMD1	0.81	0.05	17.89**	.81	.89	.73
	ACMD2	0.89	0.03	27.98**
	ACMD3	0.87	0.04	22.21**
Tourists’ attraction variety	TOUR1	0.69	0.08	8.82**	.74	.85	.65
	TOUR2	0.87	0.04	24.71**
	TOUR3	0.85	0.04	20.42**
Well-being program availability	WELL1	0.86	0.04	23.72**	.81	.89	.73
	WELL2	0.85	0.04	22.19**
	WELL3	0.85	0.04	23.92**
Perceived benefit	BENE1	0.93	0.01	64.27**	.94	.96	.86
	BENE2	0.95	0.01	73.96**
	BENE3	0.91	0.02	43.82**
	BENE4	0.91	0.02	43.04**
Perceived risk	RISK1	0.91	0.02	45.42**	.94	.96	.86
	RISK2	0.93	0.01	76.50**
	RISK3	0.93	0.01	79.93**
	RISK4	0.92	0.01	62.07**
Trust in the service quality	TRST1	0.94	0.01	77.25**	.96	.97	.89
	TRST 2	0.96	0.01	105.66**
	TRST 3	0.94	0.01	80.82**
	TRST4	0.93	0.02	59.78**
Willingness to recommend	RCMD1	0.9	0.02	36.68**	.93	.95	.82
	RCMD 2	0.94	0.01	66.59**
	RCMD 3	0.9	0.02	37.71**
	RCMD 4	0.89	0.02	35.64**

Note. SE = standard error; CR = composite reliability; AVE = average variance extracted.

p < .01.

Discriminant validity is assessed by examining (a) factor analysis results, (b) cross-loadings, and (c) the relationship between correlations among constructs and the square root of AVEs. Factor analysis results show good discriminant validity, because all the measurement items loaded highly on their own constructs but not highly on other constructs (see Table 5). As mentioned previously, CR estimates are greater than .85 and AVE figures are in the ranges of .65 to .89. The squared correlations are between .00 and .40. The maximum of squared correlation is lower than the minimum of the AVE figure, which secures discriminant validity (Hair, Ringle, & Sarstedt, 2011). Also, an examination of cross-loadings also indicates good discriminant validity, because the loading of each measurement item on its assigned latent factors is larger than its loadings on any other constructs.

Empirical Results

This section presents the results in regard to the structural equation model analysis of the research model. The results and their paths are displayed in Figure 2.

Figure 2

Causal Effects Among Constructs: A Case of Light Treatment Medical Tour Service

Perceived benefit has significant relationships with price affordability (.26, p < .01), service swiftness (.26, p < .01), tourist attraction variety (.18, p < .05), accommodation appropriateness (.20, p < .05), well-being program availability (.23, p < .01), and regulatory support (.12, p < .05). These results offer insights that consumers who had experienced medical tour services for light treatments perceive benefits of the service comprehensively from medical factors, tourism factors, and facilitating conditions. In particular, price affordability and service swiftness, of medical factors, have the largest impact on consumers’ perceived benefit.

On the other hand, perceived risk has significant negative relationships with price affordability (−.21, p < .05), ease of communication (−.33, p < .01), and regulatory support (−.30, p < .01). These consumers perceive risks of the service exclusively from facilitating conditions and medical factors. In particular, they perceive more risk as they feel more deficiency in effective communication (i.e., ease of communication) and medical tourist-friendly regulations (i.e., regulatory support).

Among the medical factors, tourism factors, and facilitating conditions of medical tour service for the light treatment medical tour service, price affordability is revealed to have simultaneous impacts on both perceived benefit and risk, which are the two major axes of service evaluation. This result indicates the versatility of price affordability as an important factor to increase the competitiveness of medical tour services for light treatments.

The positive link from perceived benefit to trust in the service quality is supported with a coefficient of .26 (p < .01). The negative influence of perceived risk on trust in the service quality is strongly supported with a coefficient of –.50 (p < .01). These results indicate that light treatment consumers’ trust in medical tour services depends both on the level of perceived benefit and risk. In particular, it is a noteworthy finding that perceived risk has twice as large an impact on consumers’ trust in medical tour services for light treatments than perceived benefit. Thus, reducing consumers’ perceived risk is comparatively more effective than increasing perceived benefit in earning consumers’ trust in the medical tour services for light treatments.

The relationship between trust in the service quality and willingness to recommend is revealed to be the strongest positive relationship for the light treatment service with a coefficient of .38 (p < .01). This result explicitly presents the relative importance of earning consumers’ trust on medical tour services to incur their willingness to recommend the service to other consumers. These results are consistent with Bigne et al. (2001) who suggest that the service evaluation influences the after purchasing behavior of consumers’ willingness to recommend the service.

Conclusion and Discussion

In the existing body of literature, evaluation methods of medical tour services are confined to considering medical tour service only as a service without effectively reflecting its unique characteristics of intangibility and high involvement. Furthermore, most prior research in medical tour services has successfully subdivided the medical tour service into market segments (Connell, 2006; Smith & Puczkó, 2010; Yu & Ko, 2012). However, the prior research has limitations in suggesting evaluation methods specified to each segment.

To resolve the incongruence in the research of medical tour service, this study proposes an evaluation model that soundly reflects the inherent characteristics of medical tour service. This study undertook the following actions to develop and empirically test the model for its expanded application into other market segments of medical tour service.

First, the process reflected intangible and high-involvement characteristics of medical tour services by structuring the contrast between consumers’ perceived benefit and risk as the focal point of the process. Second, consumers’ evaluation criteria of medical tour service that influence consumers’ benefit and risk perceptions are represented by medical factors, tourism factors, and facilitating conditions. Third, the proposed model was empirically tested with the data collected from surveying medical tourists of the light treatment segment. The results reflected the behavior of medical tourists in the light treatment segment by showing the different levels of benefit and risk perception derived from certain factors of medical tour service more appealing to this market. These results have several practical implications.

Above all, the results reiterate the importance of managing a consumers’ risk perception. A stronger relationship was found between perceived risk and trust in the service quality than between perceived benefit and trust in the service quality. This suggests that the stakeholders of medical tour service in the government, hospitals, and travel agencies may need to give greater attention to reducing consumers’ risk perception for promoting light treatment medical tour service. Then, these stakeholders can consider ways to decrease consumers’ perceived risk from medical tour service, which would be the next issue the stakeholders may raise.

This study revealed that providing ease of communication for consumers was the strongest resource of medical tour services for light treatments to decrease consumers’ perceived risk of the service. The impact of ease of communication on perceived risk is consistent with Heung et al. (2010) that communication is often one of the major concerns tourists have when visiting a foreign country. As medical tour services are built around medical treatments, which may require sensitive communication with the medical staff, this result empirically shows us the elevated concern consumers have toward effectively communicating with medical staff. Therefore, language plays a pivotal role in this aspect of medical tour service. Everything should be multilingual, from the promotional Internet website about the participating hospitals, to having an in-house interpreter service. An example of providing the ease of communication is practiced in the Bangkok Hospital International Medical Centre, which offers services in 26 different languages (Terran Tribune, 2010). Therefore, the government or hospitals should focus on elements that lead consumers to effectively communicate with the medical staff such as a government-provided interpreter system or hiring in-house multilingual nurses.

The results of this study also demonstrated that light treatment medical tour service consumers perceive high risk from the lack of supportive policies such as recognizing consumers’ home medical insurances. Such supportive policies could be developed through the collaboration of multiple governments. Medical tour service hosting governments could collaborate with the governments of other countries to develop innovative policies to resolve possible inconsistencies that may exist for consumers. The government of India’s continuous effort to discuss this medical tour service policy issue with the government of the United Kingdom serves as a good model for this type of supportive system of communication. The most controversial issue between the two countries regarding medical tour service is the 3-hour rule (Álvarez, Chanda, & Smith, 2011). This rule restricts U.K. citizens from being treated in countries that were more than 3 hours of flight time away. For the Indian government’s attempt to try to establish the medical tour service as a national strategic industry, this was a major formal barrier. To resolve this issue, the two governments have engaged in discussions to possibly increase the travel time restriction to 8 hours (Álvarez et al., 2011).

Although lowering the perceived risk for consumers was revealed to be more effective in earning consumers’ trust on a light treatment medical tour service, showing them the benefits of the medical tour service should not be overlooked. It also is important to increase consumers’ perceived benefit. Our analysis showed that consumers of light treatments perceive most benefits from price affordability and service swiftness. In other words, consumers consider efficient or lean operations of medical services as the major benefits. The field of hospital operations has recognized the importance of lean management (i.e., cost cutting) by hosting in-house accounting, logistics, supply-chain, purchasing, and other operational managers (Jack & Powers, 2009). High cost of medical supplies, often shorthanded medical staffs, complex medical insurance policies, require a well-designed supply chain, operations management, and medical industry–specific accounting management. These are tasks that need to be professionally done, and our results once again corroborate the importance and need for effective hospital management. In fact, to foster medical tour service as a national strategic industry, many governments collaborate with the medical industry to develop cost-cutting methods to provide low costs to the medical tour service industry. For example, the Singaporean government developed an innovative method to support medical tour services (Newsweek, 2009). In 2004, a Singaporean government initiative, Singapore Medicine was established with the aim of developing Singapore as a medical tourism hub. This initiative provides an exemption on medical tourist revenues from being taxed for allowing hospitals to cut costs (Newsweek, 2009). Through such efforts, medical tour service hosting countries could maintain its low cost operations and continue to provide economical medical services to consumers who visit their countries.

These results demonstrated the relative importance of reducing consumers’ risk perception over increasing benefit perception for light treatment medical tour services. These results also revealed the factors, which are more appealing to consumers of light treatment medical tour services. In other words, the distinctive consumer behaviors of the light treatment market segment are exposed, by reflecting on the evaluation model suggested in this study. Based on the distinctiveness, a service evaluation method tailored to the light treatment market segment can be developed by emphasizing on the ease of communication, regulatory support, and price affordability, the factors that are more perceptible to consumers in the light treatment market segment. Also, the factors that are relatively more important for the light treatment market segment suggest great managerial relevance to administrators of medical tour service in governments, medical institutions, and travel agencies in designing promotions specifically targeting the consumers of the light treatment medical tour service. This implication could be augmented to other market segments or other medical tour services by each specialization (e.g., dental, plastic surgery, optometry, etc.) and expected to provide customized directions in promoting medical tour services in each market segment or specialization.

Limitations and Future Research

Although the data generally support the proposed model, it is necessary to mention this study’s limitations as well. First, this study examined the factors of medical tour service that influence consumers’ benefit and risk perceptions. However, there are numerous other possible factors, such as government support, hosting country economic condition, and hospital types, among others.

Second, this study used the light treatment medical tour service as the sample. Consumers’ reaction to the services will differ depending on the market segments and medical specializations. This study indirectly illustrated the possible differences through an empirical test of the light treatment market segment. Hence, it would be valuable to investigate consumers’ reactions to other types of medical tour services and explicitly suggest diversified promotional directions specific to each type.

Third, because of the time constraints, this study used a case of medical tour service in South Korea and shows only a cross-sectional view of medical tour service consumer behaviors. After some time, with the longitudinal data, comparing consumer behavior chronologically and across different countries would be meaningful for future study.

This research was conducted in a realistic context with highly relevant domains, while simultaneously attempting to maximize internal validity. Although caution has to be exercised to avoid overgeneralizing the findings, this research has also advanced the understanding of medical tour service consumer behaviors. We expect this study to provide useful research materials for governments, hospitals, and travel agencies, and more varied and detached approaches in academic discussions.

Footnotes

Inwon Kang (e-mail: iwkang@khu.ac.kr), is an associate professor in the School of International Business and Trade, Kyung Hee University, Dongdaemun-gu, Seoul, South Korea. His research focuses on marketing applications in decision making, LISREL analysis of electronic commerce performance, and B2B commerce. Matthew M. Shin (e-mail: matt.m.shin@gmail.com), is a PhD student in the Drucker School of Management, Claremont Graduate University, Claremont, California. His research interests focus on business ethics, management performance evaluation, and Drucker on management. Jiwon Lee (e-mail: yemannuer@khu.ac.kr), is a PhD student in the School of International Business and Trade, Kyung Hee University, Dongdaemun-gu, Seoul, South Korea. Her research interests include international business, online consumer behavior, and brand management.

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