High margin medical procedures

They might be providing care and saving lives but hospitals are actually run like any other type of business, and profit is the key to survival in a competitive market. The healthcare market is worth more than one can imagine and with the rise of medical tourism, hospitals and medical practices, there is a need to compete more than ever to attract potential customers through their doors. Indeed the average US hospital barely breaks even but some can make up to 25 cents or more for every dollar that’s being spent on patients. The consumer-led approach to hospital management implies high margins and big turnovers in order to increase revenue, an arduous task as hospitals have been facing big financial challenges. We look at some of the most popular high margin operations that are currently favored by medical practices in order to face the budget squeeze.

1. Botox injections

Botulinum toxin injections are hugely profitable as patients have to come back for follow-up sessions every few months. It’s also a very competitive market as Botox courses are widely available to healthcare professionals: many medical practices now have to market such procedures and sell them as part of a package often including personal follow-up and sometimes even spa.

2. Heart surgery

Heart surgery is a very expensive but also at the same time a lucrative operation. In fact, the more complex the surgery, the higher the profit, it seems: a medical study published a few years ago revealed that surgical complications increase a procedure’s average margin by up to 330 % in the US. Some hospitals actually specialise in cardiac valve surgery in order to increase profit: they can hope to scrap up to $15,000 profit per operation.

3. Gastric bypass surgery

Weight loss surgery is performed in high numbers in countries such as the US, UK and Australia, where obesity numbers have been rising consistently over the past three decades. In the UK alone, almost two-thirds of the population is medically considered either overweight or obese. There is little wonder that the gastric bypass and other weight loss surgeries are in such high demand, with very profitable margins for the hospitals.

4. Fertility treatments

The cost of fertility treatments is very high, in medical practices all around the globe. In Canada, patients can easily have to fork out up to $10,000 per cycle for in vitro fertilization treatments. Demand for fertility treatments is growing steadily in countries where parents opt to have a child later in life. Waiting lists are so long in public sector facilities that many prospective parents are pushed to looking into private medical practices to fulfill their dream of having a family. In the UK alone, specialists believe that the medical fertility industry is probably worth around £600 million.