Thailand’s private hospitals face oil-driven medical cost hikes

Dr Paiboon Eksaengsri, president of the Private Hospital Association, told Thansettakij that the private hospital business, as it enters the second quarter, still needs to remain cautious about the impact of the war in the Middle East.

He said Middle Eastern patients who previously travelled to Thailand for medical services were now facing a high level of uncertainty, depending on unpredictable airport closures and reopenings.

Patients from some countries, such as Iran, have faced travel difficulties and have clearly disappeared from the market.

At the same time, soaring oil costs are beginning to affect several sectors, especially through shortages of plastic materials used in medical care, such as bags for dialysis fluid, as well as problems with medicine packaging.

Hospitals also need to hold medicine reserves for longer than three months, while some medicines must be imported and cannot be produced domestically.

This has left operators with more cash tied up and higher financing costs, initially estimated to rise by around 4-5%.

Hospitals also need to be careful about medicine expiry dates.

“Hospital operators are trying to tighten their belts, both on hidden costs and medicine stocks that may need to be kept for 3-4 months. Most are still trying to maintain existing prices and their current customer bases as much as possible amid rising costs. This year is a year of challenges for every hospital.”

In addition, the economy and Thai consumers’ purchasing power are starting to slow.

The number of cash-paying patients who previously visited hospitals for minor illnesses, such as high temperature, fever, headache and sore throat, has fallen by around 5%.

These patients are increasingly buying medicine themselves instead of going to the hospital.

The same trend is also being seen among people in the labour market, including those using social security benefits.

“Many factories are now slowing production, asking employees to take time off, or may even suspend operations. They may fail to remit social security contributions in the future. We need to monitor whether, over the next six months, more workers will become unemployed and leave the social security system. If these workers leave the system, the burden will immediately shift to the basic 30-baht healthcare entitlement.”

Dr Paiboon said the most worrying factors in 2026 were energy costs and plastic medical supplies.

All hospitals need to adjust their strategies by focusing on cost savings and retaining their customer base, while also assessing the economy and the prolonged Middle East conflict.

If possible, he said, the government should help facilitate travel for foreign patients entering Thailand and speed up health-related policies so Thailand can compete with neighbouring countries in the same region, such as India, Malaysia and Singapore.

Prof Dr Chalerm Harnphanich, M.D., former president of the Private Hospital Association and chairman of the executive committee of Kasemrad Hospital Group under Bangkok Chain Hospital Public Company Limited, or BCH, said BCH was still seeing continued enquiries from Middle Eastern customers about medical stays.

Daily Thai customers also remained strong.

The Middle East conflict had therefore had only a limited impact on patient numbers compared with the Thailand-Cambodia conflict, which had caused a larger loss of customers.

However, in the current situation, Thai customers are beginning to face “cost-push inflation”, making them much more cautious about spending.

More customers are switching to outpatient services (OPD), while those who need inpatient treatment (IPD) are carefully considering their insurance or welfare coverage.

If this continues, he said, there is likely to be a “sliding effect”, with cash-paying patients shifting towards basic healthcare rights, such as the 30-baht scheme or social security, so they can save money for food and daily living expenses.

Under these conditions, hospitals not only need to increase reserves of medicine and medical supplies from the usual 20-30 days to 90 days to cope with higher prices and logistics problems, but also need to adjust internally.

This includes maximum energy-saving measures, such as closing or consolidating wards to save electricity and water, while managing doctors’ and nurses’ shift schedules more tightly.

“I would like the government to help stabilise oil and electricity prices so businesses can survive without affecting the public. At the same time, I am concerned about any future increase in value-added tax (VAT), which is still not aligned with people’s purchasing power. If these costs rise, business costs will immediately increase.”

However, the direction of the private hospital business must also keep a close watch on the government’s public health policies under Prime Minister Anutin Charnvirakul.

The government is moving ahead with the development of Thailand’s health insurance system so Thais can receive treatment anywhere immediately.

The framework covers three areas:

1. Improving the management of the health insurance system to make it more efficient by developing a personal health database and linking Thai people’s data and medical treatment rights. This would integrate medical records under strict data security, allowing Thais to access healthcare rights comprehensively and equally.
2. Improving social security laws so they can support employment models in the modern economy and rapidly changing lifestyles, while raising transparency in management to create sustainability for the social security system. The government also aims to develop forms of voluntary self-insurance that can encourage employers and informal workers to enter the social security system.
3. Upgrading healthcare services for Thais by focusing on targeted medicine and medical AI technology, such as telemedicine, while promoting local wisdom and Thai traditional medicine. It also includes medical research and technology, such as biologics and medical devices, as well as support for investment in domestic production of medicines and medical supplies to strengthen Thailand’s capacity to produce medicines, equipment and medical devices locally.

The government is also focusing on strengthening the family institution, a key foundation of society, and building strong communities to support changes in Thailand’s population structure in three areas:

1. Developing people in the country to be rational, responsible for themselves, their families, communities, society and the nation, respectful of the rights and freedoms of others, able to live together with mutual understanding, and able to take part in shaping society through concrete mechanisms.
2. Creating social and community conditions that support an ageing society, so older people and people of all ages can enjoy a good quality of life, be self-reliant and participate in society. This also includes promoting the Silver Economy for and by older people, such as developing technologies and innovations that support daily life for the elderly, promoting industries or businesses that support an ageing society, encouraging income generation, savings and the use of older people’s potential, and reducing personal income tax for elderly people who have income.
3. Providing standardised shelters for older people and vulnerable groups in local areas, and implementing a village volunteer nurse project to care for patients, older people and dependent people in communities so family members can continue working. The policy also includes developing housing for low-income earners and pushing for drug rehabilitation centres in every district so users can receive treatment, helping rehabilitated drug users return to society, with participation from the private sector and local authorities.

Nevertheless, the 2026 crisis is a challenge for healthcare business operators in both the public and private sectors, who must urgently adapt.

The government should accelerate assistance measures across all sectors as quickly as possible, because if action is delayed, the burden may ultimately fall on the public.