FOCUS ON PUBLIC
Our presidential election is only days away. Forty-eight
million people in America are uninsured and healthcare costs are arising two to
three times faster than our nation's GDP. Where will America’s healthcare
system be in 5 years? Welcome to ReachMD’s monthly series, Focus On Public
Health Policy. This month we explored many questions facing healthcare today.
If you as health professional stop the movement by
consumers and patients towards medical tourism was a passing fad, think again.
It is on the verge of becoming even more global. Welcome to the Clinicians
Round Table on ReachMD XM157, The Channel for Medical Professionals. I am
Bruce Japsen, the healthcare reporter for the Chicago Tribune and with me today
is Dr. Devon Herrick. Dr. Herrick is a senior fellow at the National Center for
Policy Analysis. Dr. Herrick is a healthcare economist specializing in such
issues such as empowering patients, smart shopping for prescriptions, Internet
based medicine, consumer driven healthcare, and innovative medical care
providers. He has been quoted widely in the media. He has also been
contributing his own articles as contributing editor of Healthcare News and his
work has also appeared in Business Economics, The Washington Times and The
Journal of American Physicians and Surgeons. He joins us today from the
National Center For Policy Analysis' office in Dallas, Texas.
MR. BRUCE JAPSEN:
Dr. Devon Herrick, welcome to ReachMD XM 157, The Channel
for Medical Professionals.
Well, thanks for having me, Bruce.
Well, its great to have you here because this whole idea of
medical tourism is really starting to take off. I mean I get a lot of e-mails
and have had guests on the show, companies and people that are pushing this,
but I do not think people realize just how big this is.
Well, it has been growing by leaps and bounds, I think. For
example, a recent study by the Lloyd estimated about 750,000 Americans went abroad
for some type of care last year and they are projecting that it could actually
go up to, I want to say around 6 million by 2010. So, that is a significant
And what is driving people to seek care abroad? I think
when this started I sort of think of my aunt and uncle from Burlington Island,
who have a place in South Padre Island, who would go across the border into
Matamoros for some cheap drugs, but it is beyond that and what kind of people
are going over there? Are they uninsured, are they elderly people who may be
do not have, of course they have drug coverage now, who are these people and
why are they going?
I think it is many of the people you mentioned. For
example, I live in Dallas and I have been to South Padre and I had gone across
the border to Matamoros and bought drugs before. But you know, <_____>
South Texas has a significant number of what we call Winter Texans and retirees
that like to come from the cold climate in the North to spend the winters in
Texas and a lot of the medical tourism that currently exist is people crossing
across this border, especially to Mexico, but also there is a lot of people
that are either they are uninsured or they are under insured and I have a
health need and I look at the cost domestically and I think we can do
<_____> when going deeply in depth or if can I find a high quality
healthcare facility abroad where my total cost might be say less than $10,000 for
a heart bypass and so, I think that savings is driving a lot of it and that is
also making insurance and health plans to take notice.
I think that there are even some concerns by the American Medical
Association and others where employers in this country, in the United States,
are actually encouraging some of the workers to seek care abroad. Are you
finding that in your research?
Well, I am not finding a lot of anecdotes of companies that
have had actually paid workers to go abroad, but I am finding a lot of
anecdotes of companies that are very interested over health plans or insurance
companies that are interested in knowing more on how might this work, how might
you know what could they do to offer workers. The option cannot force them,
but offer them the option. I mean an example where people often times talk
about is Blue Ridge Paper. Several years back, they offered one of the workers
the option of going abroad to seek care.
Where is Blue Ridge Paper from?
I want to say it is in South Carolina or North Carolina, but
the bottom line was they had a worker who wanted to do it, who was doing to
lower his cost sharing substantially, but at the last visit the union stepped
in and said no we are not going to allow this. So, that was the case where
workers were willing to do, they wanted to do it because they wanted to keep
their cost sharing at a level they could afford and due to labor relations,
they were all prevented. I think in the future, you will see more of these
arrangements and increasingly I am hearing about firms, Hannaford in Maine that
is offering these options to the workers.
And I assume what would they be wanting them to seek? I
mean I guess one of the things that would be of concern to me as a patient and
certainly the medical community would be okay, where are you going to encourage
people to go and what has to be set up and we have to have some sort of quality
for people to go overseas or Canada or even Mexico? I would think that they
would want to know a lot of information about this.
Absolutely. I mean you would never just tell your worker,
you know, go somewhere, we will reimburse you. No, there are intermediaries
that actually have various hospitals, almost like the third world party
networks, you know they make sure the hospital is good, that the doctors are
good. For example, Apollo Group in India, Wockhardt in India is actually
affiliated with Harvard International, Punta Pacifica in <_____> Costa
Rica is partnered up with John Hopkins and or even Bumrungrad in Thailand. You
would want to go to a facility with an international reputation and have the
vision since many of whom actually tried in the US. If you know that you are
getting the same quality you would get at home, I mean, it would not be liked
wide we suggest to go somewhere and we will pay you back.
Well, you bring up an interesting point when you were
talking about places like Giants, Hopkins, and Harvard. Now, why would they
want to establish something that would seem to take business away from them? I
mean are they sort of willingness as they want to be treating ex-patriots or
they want to just establish, they want to go where the business is much like
McDonalds would go to a blooming company in China or so forth and not really
seeing the reasoning here. I hope you can explain it to me.
There is actually quite a bit of examples on Cleveland
Clinic has facilities that either manage or own abroad, Mayo Clinic, I think
also. In fact down the road for me in Dallas there is International Hospital
Corp, which has facilities in Brazil, Mexico, and Latin America. There is
Christus Muguerza, in Irving down the road from me that is cooperating and
partnering with firms and in Monterrey, Mexico. But the reason these firms are
doing this is some of them are wanting to attract business, as a business opportunity,
some of the big name companies, who are trying to create international brands
as healthcare becomes more globally competitive today wanted to be the
Coca-Cola, so to speak in healthcare.
Yeah, that is fascinating and so are they able to have lower
cost? I would assume they would have lower cost overseas. Otherwise, they
would not be competitive.
Oh absolutely. I have analyzed why can some of these
hospitals that have high quality, but much lower cost. Well, one of the
reasons is lower cost of labor. A physician in India, for example, only makes
40% as much of a physician in the US. Now a nurse in India, would make may be,
you know 1/10 to 1/20 as much and now that the orderly the semiskilled labor
and the manual labor are even less expensive compared to their US
counterparts. There is fewer cost subsidies. There is less third party
payment and the accompanying bureaucracy required for that, but in many cases,
because they are competing for patient dollars, they have kept streamlined of
When you think about a global economy, this makes it sound
it is more than just some senior citizens, who wants to get a chief hip
replacement going to Thailand and/or Mexico.
I think that is definitely true. I mean in fact, you know
in many other industries that we can assume goods and services global
competition is a norm. I mean, if you go to Maytag, for example, the washer or
drier you buy, the chips have been made in Asia, the subassembly may be put
together in Mexico, the pump or the motor may be in the US, but it might go to
a variety of countries, but the local domestic manufacturers out source these
products could be the most competitive they can be. Your local hospital would
not, you know ordinarily would not advise you, okay we can provide the same
service cheaper plane right away, but healthcare is going global and it is much
more common in Europe. For example, people who routinely cross national borders
for holidays or healthcare or what have they.
That is an interesting question because if they are going to
Europe, is this something that US provide…