The Expanding Home Healthcare Market in Asia
Updated: Apr 20, 2020
The global home healthcare market — including devices, products and services — was worth almost $255 billion in 2019. It is projected to continue growing at 8% per year through the end of the decade.
In Asia, rising patient awareness of home-care and an expanding middle class mean that demand for home healthcare is exploding. The Asian market for home healthcare products and services has a double digit annual growth rate.
The Asian healthcare device market segment alone (not including home health services or other products) is expanding especially quickly and will reach $20 billion in 2020, up from $15 billion in 2019.
On the other hand, in some Asian countries, healthcare infrastructure is underdeveloped. For some Asians, in-hospital healthcare can be prohibitively expensive, and many patients prefer to be convalescing at home. Additionally, many Asian countries are starting to age more quickly, while also seeing significant increases in patients with chronic diseases that require long-term care. This in turn fuels demand for in-home medical services. A lack of trained doctors, nurses and assistants in some fields — such as geriatric care — provides good opportunities for Western medical device makers that can provide easy-to-use devices for home-care.
Source: UN Population Division
Retirement villages, nursing care, home infusion therapy, respiratory therapy, meal delivery, aging-in-place establishments, rehabilitation services, medical disposables, tele-health and holistic care services have strong growth projections in Asia.
The fast expansion of technology is one key driver of the Asian home healthcare market’s quick growth. Healthcare IT will be key in addressing the many unmet medical needs of Asian countries. The Asia-Pacific mobile health service industry alone will be worth almost $8 billion by 2018, with most value in tele-monitoring and diagnostic services. By 2018, China was the largest Asian mobile health service user in terms of revenue — accounting for almost $4 billion. Japan will be the second largest mobile health service market with revenues of $2 billion, while India will be third with revenues of close to $1 billion.
Lifestyle differences between the U.S. and Asian countries should be considered when exporting and marketing medical device products in Asia. For instance, Japanese homes are much smaller and have more narrow doorways — so the size of products should be reduced accordingly. Other differences, such as common home furnishings, sleeping mats and showering customs, should also be taken into consideration.
Japan has one of the largest healthcare markets in the world, valued at over $100 billion. Japan is also one of the most rapidly aging countries: by 2025, 36% of Japanese will be over the age of 60. The Japanese home healthcare market — including medical devices, services and other products for home use — was worth approximately $25 billion in 2013. Imported device products account for 20% of the homecare device market. The largest healthcare product segments include adult diapers, convalescent beds, hearing aids, wheelchairs, handrails and products for patients who have had strokes and/or heart attacks and will be bed-ridden at home. Japanese homecare product importers are looking for Western home healthcare products that are innovative and conducive to the Japanese home.
There were more than 5 million Japanese officially requiring long-term care in 2011, meaning that they receive government-supported long term care insurance. Millions more have physical disabilities that often require home healthcare equipment and services. Insurance is available for Japanese over the age of 40 who are bed-ridden or afflicted with dementia. Those with rheumatoid arthritis, terminal cancer and cerebrovascular disorders are also eligible.
Japan has by far the best insurance for home healthcare patients in Asia. Under the country’s National Health Insurance, there are 16 types of home healthcare services approved for reimbursement. Coverage includes short and long-term nursing home stays, home renovation, home healthcare support services, purchase and/or rental of home-care equipment and rehabilitation support services. Generally, insurance covers 90% of the cost of home-care services and devices.
For instance, approximately 110,000 Japanese use an oxygen concentrator to increase lung function. Other approved therapies include ventilators, continuous positive airway pressure (CPAP) therapy for sleep apnea, home dialysis systems, insulin administration for diabetics and infusion therapy. In 2013, rented home healthcare products covered by insurance were valued at $2.7 billion, and the market is growing at almost 10% annually.
Japan also has several government programs promoting the expansion of IT in healthcare through increased health record access and home healthcare quality — such as “My Hospital Everywhere” and “Seamless Cooperation.” The government has established a certification program for nurses to diagnose and treat basic illnesses, reducing the costs of doctor visits to patients’ homes.
As more Japanese hospitals expand their healthcare IT services, the market share will increase exponentially. Cloud computing services for the Japanese healthcare sector are projected to grow from less than $100 million in 2011 to $2.5 billion in 2020. Fujitsu, a large Japanese IT company, controls a significant portion of the electronic health record market and is expanding its networking services and cloud availability. Fujitsu launched several cloud-based home healthcare services in 2013. With a local partner, GE Healthcare also started offering cloud computing services for medical image data sharing in 2011.
Smartphones and tablets are also multiplying the possibilities of home healthcare. Microsoft Japan has developed software to support home visits by doctors, while Yamada Denki, a Japanese electronics retailer, has released tablet software for home healthcare use. Medical devices such as blood pressure monitors or cardiographs can be marketed for home use, and the information collected can be sent to the patient’s hospital or clinic. Rural areas are seeing a decline in the number of hospitals and doctors, increasing the need for IT connected home health technologies.
There are several product areas that U.S. home healthcare companies can do well in. Rehabilitation equipment for hospital and home use is a fast expanding sector, as the Japanese government is heavily emphasizing this field. Dementia patient care technology and equipment is another high growth area. There are around 2.2 million dementia patients in Japan — and half of these are living at home, cared for by family members. In addition to remote patient monitoring, home monitoring and alert systems for seniors living alone will be an increasingly lucrative market. There are almost 5 million households headed by a single person 65 years of age or older, and this number is growing quickly. Western device companies should look to expand their product lines and markets in high-tech communications technologies for people with disabilities, wearable devices, rehabilitation robots and equipment to assist caregivers with transferring patients to beds and wheelchairs.
China is another good market for home healthcare products and services, with a value of more than $3 billion. There are 85 million disabled people in China, and 75% require assistive devices. There are a further 230 million Chinese with chronic illnesses. With 150 million cars on the road, the incidence of traffic accidents is high. Almost 320,000 injured workers receive government funded rehabilitation treatment annually. Home healthcare is a very attractive option for those with chronic diseases or recovering from injuries, convalescing at home.
Demographically, aging is another issue in China. While not aging as quickly as Japan, there will be 290 million Chinese aged 60 or older by 2025 (compared to 175 million today), accounting for approximately 20% of the Chinese population. Many will be suffering from cancer, dementia, diabetes and/or cardiovascular disease.
China started allowing private healthcare establishments in its 12th Five Year Plan (2011-2015), which has opened the door to private home healthcare services and nursing facilities. There are already several joint ventures between U.S. health providers or investors and Chinese senior care companies currently underway in China.
In China, there is a strong cultural tradition of caring for elderly relatives at home. The Chinese government announced in 2012 that it would promote home healthcare as the main strategy to care for the growing elderly population. The Chinese government aims for 90% of seniors to be cared for in their own homes or in the homes of their children. A projected 7% of low-income seniors will live in government-funded elderly communities and hospitals. The remaining 3% of seniors will move to private nursing facilities and senior housing.
Chinese startups like PineTree (Beijing) and CCX Homecare (Shanghai) are joining early U.S. market entrants in home healthcare provision — such as Right at Home and Home Instead, two of the largest international home healthcare providers. These companies focus on providing cost effective in-home senior care for elderly Chinese. U.S. based Direct Supply (Milwaukee), which markets senior care products and services, has also been investing in China to expand its relationships with domestic and foreign senior care facility operators.
Western senior care brands are increasingly successful in China due to both a positive brand perception and a growing middle class that can afford such products. The senior care market is projected to explode in the next several years, making now a great time to start market penetration as well as build up brand recognition and market share.
The Indian home healthcare industry is valued at almost $2.3 billion and is expanding at more than 18% per year. While aging more slowly than Japan and China, by 2025 there will likely be almost 160 million Indians over the age of 60, about 10% of the population. Chronic diseases are also increasingly prevalent. The middle class is expanding and better able to pay for preventative and primary care. Hospitals are often not easily accessible for many rural Indians, increasing the attraction of homecare for chronic illness and post-operative care. Public awareness of home healthcare has also been rising. This is due in large part to the desire for cheap, efficient, comfortable quality care. An estimated 65% of hospital visits in India involve healthcare that can be done in the home.
The increasing utilization of technology will allow more care to be given at home instead of at an expensive hospital. The home healthcare services most in demand in India are geriatric care, diabetes management, paramedical care and physiotherapy. Sleep apnea is another attractive area for home healthcare, as an estimated 160 million Indians have the disorder. India’s mobile healthcare sector is also growing quickly, especially in the area of diagnostics — due in large part to India’s sizeable rural population.
Indian companies that have been expanding their presence in the home healthcare market include Metropolis Health Services (India) and Apollo Hospital (India). Some offer “doorstep” diagnostic tests, such as ECG, x-ray and ultrasound tests. Other large hospital groups like Columbia Asia (Southeast Asia), Hinduja Hospital (Mumbai) and Max Healthcare (India) have also started offering homecare services.
A variety of Indian start-ups — such as Health Care at Home India (Delhi), India Home Health Care (Bangalore) and Homital (Delhi) — are now entering the home healthcare market to provide services like post-surgery care, elderly care, physiotherapy and palliative care. These companies are also receiving increased attention from investors. In September 2013, home healthcare firm Bayada (U.S.) purchased a 26% stake in India Home Health Care. Portea Medical (Delhi) received $8 billion in investment funding in December 2013.
These growing Indian home healthcare firms generally only offer homecare services in large cities like Delhi and Bangalore. However, they are now expanding geographically and utilizing more home medical devices in their provision of services. Homital reported 300% year-on-year growth in 2013-2014 and is preparing to expand its operations to 4 more major Indian cities by March 2015. Health Care at Home India plans to expand into 3 more cities in 2014, followed by smaller towns in 2015. Portea Medical currently operates in 12 cities and covers 2,500 visits a month. Portea plans to expand to 50 more cities by early 2106.
Western companies like such as Philips, GE Healthcare and Johnson & Johnson have been operating in the Indian home healthcare market for years. To better enter the local market, many manufacturers utilize a rental marketing model, leasing larger equipment to Indians on a short or medium term basis due to affordability issues.
Western medical companies selling products that assist with home-based patient care should see quickly expanding market opportunities in Asia. Many countries have aging populations that are increasingly wealthy and able to afford home healthcare treatment that is often more cost effective than hospital stays. Many Asian countries have a culture of caring for the elderly in their own or relatives’ homes — further accelerating the demand for homecare products. Due to a shortage of qualified health professionals and a lack of homecare doctor availability, home care products that are easy for the patient or caregiver to use and/or that integrate IT will find an especially large market in Asia.