Export of quality of health services to the foreign consumers is considered as a popular way of health trade in the South in recent years. Trade in quality of health services may suffer from the problem of quality signalling from the point of view of the patients of the North. Actually, patients of the North are misdirected by the quality of health services if proper signalling is not provided by the health quality producers of the South. Again signalling incurs some cost and hence production and export of high quality health services becomes unprofitable to the health quality producers of South. Hence, there exists a definite demand-supply mismatch regarding health quality. To capture the issue of quality signalling in the context of health services we want to develop a partial equilibrium framework, where the producer of the health quality in South, we refer to it as Multinational Health Service Provider (MNHSP), may enjoy some amount of monopoly power as this MNHSP has some special skills or it may introduce new quality of health services. The model shows that a movement from autarky to no autarky situation leads to, under reasonable conditions, a decline in signalling costs associated with high quality health services and also leads to an overall increase in demand for high quality health services in the South. © Springer India 2016.