Posted on 11/02/2006 11:56:52 AM PST by indthkr
Businesses and insurance companies are starting to eye the potential savings of outsourcing health care from the world's richest country to the developing world.
"It's just one of the many ways in which our world is flattening," said Arnold Milstein, chief physician at New York-based Mercer Health & Benefits, who's researching the feasibility of outsourcing medical care for three Fortune 500 corporations. "Many companies see it as a natural extension of the competition they've faced in other aspects of their business."
With an estimated 45 million uninsured Americans, some 500,000 trekked overseas last year for medical treatment, according to the National Coalition on Health Care. Asian hospitals in Thailand, India and Singapore have long been swarmed by medical tourists looking for tummy tucks and face lifts, but many glitzy, marble-floored facilities are now gaining reputations for big-ticket procedures including heart surgery, knee and back operations.
Some American hospitals already rely on places like India for X-ray readings and other diagnostics, while also importing foreign doctors and nurses. But the U.S. health care industry has been largely immune to overseas competition — just one reason behind soaring costs.
Premiums for employer-sponsored health coverage have surged 87 percent over the past six years, according to the Kaiser Family Foundation, putting a huge burden on both companies and employees. Family health coverage now runs about $11,500 annually, with workers themselves forking out nearly $3,000.
But just as shipping U.S. manufacturing to China and call centers to India initially created loud opposition, some critics are already preparing to fight any possible mass exodus of Americans packing their bags to go under the knife overseas.
In September, Canton, N.C.-based Blue Ridge Paper Products Inc., was set to send one of its employees to India for a gall bladder operation. Carl Garrett would have been the first U.S. employee sent abroad for medical care through an employer-sponsored pilot program, which would have allowed him to share the company's savings.
Shortly before Garrett was set to leave, the United Steelworkers, America's largest union, pulled the plug.
"We don't want to expose our members to the risks associated with providing health care in the Third World," said Stan Johnson, a union spokesman. "This is perceived to be voluntary, but voluntary programs tend to lead to mandatory programs."
Blue Ridge ultimately scrapped its plan for union members, but several other U.S. businesses and insurance companies are starting to explore the option of exporting patients.
"I get the impression that they're all waiting for someone else to take the first step," said Jason Yap, director of health care service for the Tourism Board in Singapore, another major medical tourism destination. "They're all interested in doing the homework now so they can move ahead when the time comes."
United Group Programs, a Boca Raton, Fla.-based company that sells self-insurance policies to small businesses, is already offering a plan that sends patients to Bumrungrad International hospital in Bangkok, Thailand. UGP says the plan will save employers more than 50 percent on major medical costs and slash employees' out-of-pocket expenses to zero.
Blue Shield of California and Health Net of California also both offer lower-cost policies allowing members to seek medical care in Mexico.
In June, David Boucher, an assistant vice president at BlueCross BlueShield of South Carolina, traveled to Bangkok for a close-up look at Bumrungrad. The Thai hospital began heavily recruiting overseas patients after the 1997 Asian financial crisis. It drew 400,000 foreigners last year — including 55,000 Americans.
"I was thoroughly impressed," Boucher said. "We're taking a serious look at this as an alternative" for the health plan's 1.5 million members.
In addition, West Virginia lawmaker Ray Canterbury plans to propose legislation next year that would give government employees the option of traveling abroad for necessary procedures, which could save the state up to $2 million annually. He wants to offer incentives, including extra sick leave and 20 percent of the cash saved by going abroad — allowing workers to actually make money on the deal.
Dodie Gilmore is a rodeo barrel-racing champion who runs a 180-acre ranch in Oklahoma when she's not bouncing across back roads selling farms. Gilmore is a spry 60-year-old who loves the outdoors, but when she could no longer straddle her faithful horse, River, she knew it was time for a new hip.
But how could she afford it? As an independent contractor for a small Coldwell Banker real estate franchise in Durant, Okla., she knew her privately purchased health plan would never pay up to $40,000 for the operation.
So she asked her boss about traveling to India where hip resurfacing alone would cost just $7,000. He not only gave her his blessing but offered to foot the bill, minus travel and hotels — making Gilmore one of the very first Americans sent overseas for surgery by an employer.
"The doctors were wonderful," Gilmore said days after being discharged, sipping coffee at a New Delhi roadside cafe with her sister, Carol, who was along for whole trip. "The overall care was pretty darn good."
More and more patients like Gilmore — who had never held a passport or even tasted Indian food before her trip — are returning home and spreading the word about an alternative to America's ailing health system.
Gilmore's boss, Martin VanMeter, who owns a Coldwell Banker office with about 24 workers, wasn't obligated to pay anything toward the hip surgery. But he sees his employees as family, and if they're too hurt or sick to work, no one benefits.
"I've invested so much money in them," he said by telephone. "All she's got to do is make one transaction for us, and we've got our money back."
But even with the growing momentum, big questions must be asked by anyone considering treatment abroad.
Despite the five-star facades of some hospitals — fountains, white marble floors, even a Starbucks and McDonald's inside Bumrungrad's lobby — the comfort of having a major surgery near home with family at the bedside is a far cry from the experience in the developing world, where culture shock alone can be stressful.
Pollution, poverty and insane traffic are all part of the experience when visiting hospitals like the Indian-owned Max Healthcare facilities in New Delhi, where it's not uncommon to see people urinating along roadsides. Jet lag, traveler's diarrhea and strange foods also can be coupled with the unpredictable, such as September's bloodless military coup in Thailand, which ultimately had little impact on daily life.
Language and cultural barriers also can make communication with doctors and nurses frustrating for some Americans, who are used to being direct with their physicians, often peppering them with tough questions and expecting straightforward answers.
Some Asian cultures also rely more on hints and subtleties to communicate, and doctors in some countries are regarded as authority figures who often aren't questioned. Follow-up care back in the U.S. also can be an issue for some patients.
"There are a lot of risks," said Rick Wade, a senior vice president at the American Hospital Association. "What happens if something goes wrong?"
In countries like Thailand and India, medical malpractice claims are rare and multimillion dollar awards are nonexistent.
"If there's a mistake, we fix it," said Curtis Schroeder, an American who is group CEO of Bumrungrad hospital, which requires all doctors to carry malpractice insurance. "But the idea of suing for multimillions of dollars for damages is not going to be something you can do outside the U.S."
In February, Joshua Goldberg, a 23-year-old American who was traveling in Thailand, died at Bumrungrad after seeking care for a leg injury. His father, James Goldberg, has set up a Web site alleging the hospital administered a deadly drug cocktail to a patient with a history of substance abuse.
Bumrungrad insists the care given was appropriate. Thai authorities are investigating the case, as is standard with all unexpected hospital deaths. No conclusions have been reached.
"What I'm dedicated to doing is to try to alert people to at least do their homework and consider very carefully what they're getting into. Why is this such a good deal?" Goldberg said by telephone. "You might not walk away. That's what happened to my son."
It's ultimately up to patients themselves to investigate hospitals and physicians before considering surgery abroad. The Internet is loaded with resources that range from doctor bios to patient blogs, detailing the positives and negatives.
As the phenomenon grows, more countries are trying to get in on the action. The Philippines began a campaign this year aimed at attracting Filipinos living abroad and Asians within the region. Packages offering city tours, day spas and even golf have been combined with health checkups and cosmetic surgery.
Some experts predict greater access to options like these will eventually drive more people to take control of their own health care.
Medical tourism facilitators like California-based PlanetHospital are banking on it, already working to make the journey less stressful for patients traveling abroad by arranging everything from visas and airport pickup to sightseeing.
Many doctors working in facilities catering to medical tourists are trained abroad, often in the U.S. or Europe. About 100 foreign hospitals have been approved by the international arm of the Chicago-based Joint Commission on Accreditation of Healthcare Organizations, which also accredits American hospitals.
Six countries in Asia have accredited facilities, including Bangkok's Bumrungrad; five in India, with three belonging to the Apollo Hospital group; and 11 in Singapore.
The Max Super Speciality Hospital where Gilmore had her surgery on Oct. 10, is working to become accredited, but she said she felt comfortable from the very beginning. Even if her boss had refused to pay for the surgery, she said she likely would have made the two-day flight on her own because her insurance would never have paid to fix the pre-existing condition.
"It's either that, or do it in the States for $28,000 to $40,000," she said. In the U.S. do you not sign forms? They're not responsible. The risk of it didn't really weigh on me."
In addition to saving thousands — the three-week trip totaled about $12,000, including the surgery, travel and lodging for two and a tour of the Taj Mahal — she also underwent a new technique just approved this year in the U.S.
Instead of total hip replacement, which limits mobility and requires the top of the femur to be cut off and a long shaft inserted, hip resurfacing uses only a small ball-and-socket device that enables patients to maintain their flexibility for activities like yoga, praying or even racing horses.
Gilmore's Indian physician, Dr. S.K.S. Marya, chief surgeon at the Max Institute of Orthopedics & Joint Replacement, has performed some 150 hip resurfacing operations over the past two years. About one American comes to him for the surgery each week, and Gilmore is just the latest in a growing number of satisfied patients who plan to keep their passports renewed.
"Every day I feel better. I can get around on one crutch now," said Gilmore, who plans to be back in the saddle within six months and out selling ranches soon after returning home. "I don't have near the pain. I can already move my leg a lot more than I could before. I can actually go up the stairs without pain, that's something I couldn't do before."
I don't know anything about the French system, but the Japanese system does seem to work for Japanese --- at least now: with the coming demographic shift in Japan, I am not sure that it will continue to be viable there.
However, I am also not sure the Japanese system would work here, since the U.S. is quite different. In particular, I think that our litigiousness would probably derail trying to model our system after Japan.
the lawsuits are part of it, yes. but there is more to it then that.
I also like the "medical 401K" MSA model - with some twists.
the contributions come from 3 components - employee, employer (mandated), and government (consumption tax, because something has to be done to include people who currently pay nothing). government workers also go into this plan. out of your medical 401K, you buy the private insurance plan of your choice.
but I agree, that politically, universal medicare is the likely outcome of all of this.
"Do you propose a solution, or shall we close up our borders and trade with nobody?"
Yes, I do propose a complete and fair solution.
There are certain "givens" of American life which we've established for good reasons, based on experience: Social Security, Worker's Compensation, Unemployment Insurance, OSHA, child labor laws, universal education, minimum wage laws, maximum hourly work weeks after which overtime must be paid.
All of that stuff is expensive for employers, employees, the whole economy. The REASON that foreign labor is so cheap, whether you exploit it in China or use illegal aliens here, is precisely BECAUSE you don't have to pay all that overhead.
Chinese slaves make socks for about a dime. They get sold here for $1. American sockmakers...when there used to be some...were far more efficient at making a given pair of socks, but all that mandatory overhead made the socks cost $3.
The answer, the whole answer, is to impose import tarriffs that equalize the effect that non-protection of foreign workforces has on price. So, for example, there would be no import tarriff from Japan or Europe: their workers and employers pay the same or more than American workers and employers do, and have comparable or greater protections. But Chinese socks would have a $2 equalization tarriff imposed on them, to increase the price of those imports to compensate for the fact that they were made by unprotected slaves abroad. Note that shifting Chinese goods to a less-oppressive place like Indonesia doesn't avoid the tarriff. (This is why you can't just ban the goods from the really bad places but import them cheap from less bad places: the goods get made in the bad places but shipped raw, to have the labels sewn on them in the less-bad places, defeating the whole purpose of the ban. By contrast, impose the equalization tarriff, and the socks from Indonesia, which doesn't have worker protections to speak of either, get hit with just about the same $2 tarriff, so there's no defeating it.)
Equalization tarriffs are the answer. They protect American businesses from the effects of foreign non-protection of workers, without, however, raising the drawbridge on free trade with other countries that DO protect their workers.
This does indeed impose costs on the American consumer. No doubt about it. They have to pay $3 for a pair of socks they currently pay $1 for. That $2 difference can be bandied about as a 200% increase, by those who would oppose the idea, but this is not something that would hit the entire economy. This is something that would particularly hit consumer goods, and that 200% does not slide all the way up the scale. More expensive things don't have the same huge profit margin in them that cheap things do, because even China doesn't use slaves to make more sophisticated manufactured goods.
That's the answer.
OK...you say "This does indeed impose costs on the American consumer. No doubt about it. They have to pay $3 for a pair of socks they currently pay $1 for. That $2 difference can be bandied about as a 200% increase, by those who would oppose the idea, but this is not something that would hit the entire economy. This is something that would particularly hit consumer goods, and that 200% does not slide all the way up the scale."
How much though? Does a DVD player go from $40 to $475? Or $40 to $60? If you think about the plethora of goods manufactured overseas in cheap markets, the average consumer could easily spend TWICE as much as they do now buying things, or just not buy them. Either way, decreasing consumer spending to a point that could cause a large depression.
Nah, world health insurance. Isn't there something about a Healthy People 2010?
tariffs will not happen. the only way to rebalance the equation - is to raise taxes on consumption of these goods at the point of sale, and lower taxes on wages.
Neither of those things are going to happen either.
So, you're all going to end up serfs.
How much did the last American-made televisions cost vis-a-vis their foreign competition, before the Americans went out of that business a few years ago?
Suppose a DVD player does cost $475. How many do people need?
Remember, the choice is not between having what we have now or having less. It's between having massive job insecurity and gradually being redduced in wages and protections, down to third world levels, or spending more and preserving the protections we have.
To compete with Chinese goods, we have to abandon social security, unemployment insurance, child labor laws, OSHA, and just go straight for serfdom. Otherwise, they win, because slaves are the cheapest possible labor, and the slaves aren't going to be agitating for greater rights, bringing up their costs. We will either proptect ourselves, by accepting the higher costs, or we will race with them to the Asian labor market bottom.
In America, we will either close the border, or there will be no work for unskilled and semi-skilled American labor, because no comparable American can compete with an unprotected Mexican. The Mexican works just as hard, and costs half as much.
There is no job in America - none except political jobs and government jobs - that are not just like the plight of the American laborer trying to compete with the Mexican laborer, or the American textile worker trying to compete with the Chinese slave. Europe, at least, has protected itself sufficiently that it still HAS a large domestic manufacturing sector. In America, to save a buck, we ship the jobs offshore, and give the American company a tax deduction for the cost of foreign labor!
YOU are paying, out of YOUR taxes (YOU dont'get the tax deduction), for your employer to ship YOUR job to the equally qualified, hungrier and cheaper foreigner who will eventually drive down your wages and drive you out of a job completely. Even doctors - skilled labor - are not safe. Legal jobs are being offshored to India.
Be government, be a capitalist, or be a service-sector guy with little protection.
Pay $475 for the DVD player and accept the economic constriction in the short term in order to preserve the American manufacturing base and security of employ in the longer term.
You don't NEED any but most people could get by with one if they wanted one. That's not my point. The point is if, using the DVD player example, sales of DVD players drop 95% then suddenly these protected American jobs will disappear anyway because NOBODY WILL BE BUYING THEM.
Fire retardent bloomers time, get ready.
As long as they come here from somewhere else, at least that was my latest experience.
Guess you haven't visited lately...
Texas, or India?
The only surprising thing is that that this hasn't happened earlier... Many hospitals in India and Thailand, and probably other places too, provide better quality care than the best ones in Britain. I found this website: http://www.globalhealthhub.com that has some good information on the topic.
Out-source our lawyers next?
I have always wondered what the word "universal" really means. Just a word that belies it's meaning?
As a reminder, Medicare or Medicaid do not pay for medical costs incurred in a foreign country. Private coverage does.
Yeah, I know. I bought a Universal remote control and was vastly disappointed when it only changed channels on my TV.
I had hoped I could at least zap liberals at a distance and see if shock therapy cured their disease.
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