U.S. insurers consider sending patients overseas for cheaper treatment

U.S. insurers consider sending patients overseas for cheaper treatment

By Corrie MacLaggan
AMERICAN-STATESMAN STAFF
Monday, October 27, 2008
CHENNAI, India — This is not how Jay Tronson pictured the hospital. In photos online — though maybe he was looking at pictures of the wrong hospital — he saw a modern glass structure sitting on a grassy hilltop, not this older building crammed into a busy neighborhood.
As he walks into the crowded, noisy lobby of Apollo Speciality Hospital, he tries to stay focused on the fact that he will be operated on by a well-regarded surgeon, that the reason he traveled here from Pearland, near Houston, is to end the pain in his hip.
"As long as the operating room is sterile and the doctors are competent, I don't really care" what the hospital looks like, he says, leaning on his cane.
In the lobby, a hospital staffer is waiting to whisk him up the elevator to the fourth floor, past a nurses' station and through double doors under a sign that says "Platinum Ward."
Suddenly, the slightly sour smell gives way to a sweeter aroma. Elevator music plays. There are leather couches and an aquarium. He walks into his hospital room, which includes a flat-screen TV and a laptop.
This is where the foreigners stay. He is pleasantly surprised — and relieved.
A recent report estimates that hundreds of thousands of Americans go abroad each year for medical procedures, primarily to save money.
They are not the only ones eyeing the bottom line. Some U.S. insurance companies — including Aetna and UnitedHealthcare — are considering paying for patients to go overseas for care, which could spark major growth in the medical travel industry. Wockhardt Hospitals officials said major insurers are requesting data that show how well the Indian company's hospitals treat patients, a sign that the insurers are investigating options in India.
"I don't know where this will stop," said Dr. Kushagra Katariya, a cardiothoracic surgeon and CEO of Artemis Health Institute in Gurgaon, near New Delhi.
Quests for care
Medical tourism isn't new. For decades, people from around the world have come to Houston, for example, in search of good doctors. Americans have long traveled within their country for specialized care — take U.S. Sen. Edward Kennedy, D-Mass., who went to North Carolina for surgery on a brain tumor.
And the American health care industry, like many businesses, is already outsourcing functions like reading X-rays to overseas providers.
Now, more and more Americans are traveling to countries like Singapore, Thailand and Costa Rica for medical procedures that are cheaper there than at home. Sometimes, they don't have insurance; sometimes, their insurance doesn't cover what they need.
"The American health care system has pushed itself into a corner where even the most routine care is not financially accessible for the average family," said Dr. Steven Tucker, an American oncologist in Singapore who is president of the International Medical Travel Association, a nonprofit group of health care providers and medical travel agents.
Estimates of the number of medical tourists vary widely and depend on how the term is defined. A new report by the Deloitte Center for Health Solutions, a research arm of the accounting firm Deloitte LLP,says that 750,000 Americans traveled abroad for medical care in 2007. Meanwhile, Josef Woodman, author of the consumer guide "Patients Beyond Borders," puts the 2007 number closer to 180,000.
The global consulting firm McKinsey & Co. released a study in May that said the trend is far smaller than commonly reported. It put the number of all medical travelers — not just Americans — at 60,000 to 85,000 per year. But that study, unlike the Deloitte one, used a definition of medical travel that does not include people who get outpatient procedures or go to neighboring countries for care.
A November 2007 report by the Dallas-based National Center for Policy Analysis, a research institute, said India "arguably has the lowest cost and highest quality of all medical tourism destinations, and English is widely spoken."
Almost everything that hospitals need is cheaper in India, including labor. Nurses earn $2 an hour "if they're lucky," Katariya said. They earn $1.60 an hour at Artemis.
In "Patients Beyond Borders," Woodman says that if the estimated out-of-pocket cost of treatment in the United States — including consultation, procedure and hospital stay — is $6,000 or more, "you'll probably save money traveling abroad for your care. If it's less than $6,000, you're better off having your treatment at home."
Traveling long distances for medical care isn't right for every patient or procedure, said Dr. Charles Cutler, who recently retired as medical director of Aetna's national accounts. For example, he said, you wouldn't want to put someone with significant heart disease on a long flight.
"You can come down to a fairly short list of things that make sense," Cutler said. Joint replacements would be on the list because they're a one-time procedure, he said, but treatment for chronic ailments would not.
'Willing to innovate'
Some people who have health insurance can already travel overseas for care as part of their health plan.
One example is Hannaford, a self-insured grocery chain in New England and New York whose health plan is administered by Aetna. This year, in what Aetna calls a pilot program, Hannaford started giving employees the option of going to National University Hospital in Singapore for knee and hip replacements. Hannaford will waive the co-payment, saving the employee $2,500 to $3,000. Hannaford will also pay for the plane ticket.
No one has gone to Singapore yet, and Hannaford spokesman Michael Norton said the company is hoping that the program will stimulate competition to reduce the price difference between U.S. hospitals and the Singapore hospital.
"We're willing to innovate to make it clear there is a barrier to employers in terms of getting the quality and the cost that they need," Norton said.
BlueCross BlueShield of South Carolina has a wholly owned subsidiary called Companion Global Healthcare Inc. that has a network of 10 hospitals in Costa Rica, India, Ireland, Singapore, Thailand and Turkey. Companion has been serving patients from self-insured employers — companies like Hannaford that fund their employee health plans — as well as people who have BlueCross BlueShield health insurance and need a procedure that is not covered because the condition was pre-existing.
Companion President David Boucher said that in the future, BlueCross BlueShield of South Carolina and other insurance companies will encourage employees of fully insured companies — those that pay health insurance companies to cover their employees — to go overseas by offering a reduced co-payment or deductible.
"I'm fairly bullish on where I think this is going," Boucher said. "I think we'll begin seeing actual changes in that benefit structure for BlueCross groups come January." He stressed that BlueCross wants to offer options, not force a patient to go overseas.
Last year, the Texas Legislature passed a bill that made it illegal for insurance companies to mandate that patients go overseas for care.
The bill's author, state Sen. Carlos Uresti, D-San Antonio, said that medical travel raises too many questions about continuity of care, liability, language barriers and what happens if a patient dies overseas.
"I'm sure it's a beautiful country," Uresti said of India. "But if I were to have to have surgery ... I wouldn't want to have to travel to a foreign country. I don't think it's fair to put our consumers in that position where they're required to go."
A dose of skepticism
Some insurance companies are also skeptical about medical tourism. Humana, for example, does not pay for treatments abroad, spokeswoman Anna Hobbs said. "We find that there's difficulty determining quality standards for physicians and hospitals abroad," she said.
Standards can vary widely from hospital to hospital. The Joint Commission International — an affiliate of the organization that inspects U.S. hospitals that receive Medicare dollars — checks everything from whether hospital workers wash their hands to how hospitals procure, secure and administer medication.
The Joint Commission International is so well-respected that some medical travel companies work only with hospitals that the organization has accredited — about 200 worldwide, including 10 in India.
American Medical Association President-elect Dr. James Rohack of Bryan said, "If I'm going to travel internationally and I get sick, I'm going to look for a Joint Commission-accredited hospital."
However, Paul Keckley, executive director of the Deloitte Center for Health Solutions and the author of a recent report on medical tourism, said Joint Commission accreditation isn't performed with "the same intensity" overseas as it is in the United States.
Dr. David Jaimovich, chief medical officer of the commission, disputed that, saying that quality standards for foreign hospitals are comparable to those in the U.S.
India churns out more than 40,000 new medical professionals each year, and many of the top graduates emigrate. More than 23,000 Indian doctors practice in the United States, according to the forthcoming "Patients Beyond Borders: India Edition."
"There is a huge group of Indian clinicians who have become very successful in the Western world," said Vishal Bali, CEO of Wockhardt Hospitals. "There is a familiarity which is already there" with Indian doctors.
Keckley said insurance companies might be more tempted by medical tourism than they're willing to admit.
"What will happen is the plans will tiptoe into this," Keckley said. "Plans are fearful of saying, 'We're going to invest some money.' The minute that's in the press, every local hospital, every local doctor says, 'Over my dead body.' "
Like Boucher, Keckley sees the trend growing exponentially — unless there's a "major blowup," he said. "The thing that could really derail this is if one person came back disfigured from a botched procedure somewhere and it got in the newspaper ... and health plans backed off."
Tronson's wife, Delia Williams-Tronson, says a botched procedure is exactly what she fears most for her husband.
In Tronson's hospital room, a staff member checks him in, and another takes him down the hall to be weighed. The scale reads 88, which sounds wrong until he realizes that it's in kilograms. He's confused when the nurses keep calling him "Jay Alfred," his first and middle names.
The next morning, he's wheeled out of the Platinum Ward and toward the operating room.
cmaclaggan@statesman.com; 445-3548
Medical cost comparison
Here are estimated prices for surgery, including hospital stay in a private room. Add about $5,000 for hotel and coach airfare for the patient and a companion. For example, a hip replacement in Thailand would cost about $18,000, which would be a savings of at least $15,000 compared to the estimated U.S. price.
Procedure U.S. India Thailand Singapore Malaysia South Korea Taiwan
Heart bypass $70,000 to $133,000 $7,000 $22,000 $16,300 $12,000 $31,750 $27,500
Heart valve replacement with bypass $75,000 to $140,000 $9,500 $25,000 $22,000 $13,400 $42,000 $30,000
Hip replacement $33,000 to $57,000 $10,200 $12,700 $12,000 $7,500 $10,600 $8,800
Knee replacement $30,000 to $53,000 $9,200 $11,500 $9,600 $12,000 $11,800 $10,000
Face-lift $10,500 to $16,000 $4,800 $5,000 $7,500 $6,400 $6,650 $8,500
Gastric bypass $35,000 to $52,000 $9,300 $13,000 $16,500 $12,700 $9,300 $10,200
Prostate surgery $10,000 to $16,000 $3,600 $4,400 $5,300 $4,600 $3,150 $2,750
Source: 'Patients Beyond Borders' by Josef Woodman

U.S. insurers consider sending patients overseas for cheaper treatment

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I know this is not veterans, but we all have family members that may be affected by this, there is something wrong when our medical system would even consider this, we supposedly have the best medical system in the world why would we as citizens allow this to happen?

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