In an effort to combat rising drug prices, one Utah health insurer will pay its members to travel to Mexico to fill prescriptions for certain expensive drugs, according to The Salt Lake Tribune.
This morning’s post by fellow blogger, Joe Paduda, contained a small paragraph that linked to an article in the Harvard Business Review (HBR) about a hospital in the Cayman Islands that is delivering excellent care at a fraction of the cost.
Joe’s blog generally focuses on health care and workers’ comp issues, and has never crossed over into my territory. Not that I mind that.
In fact, this post is a shoutout to Joe for understanding what many in health care and workers’ comp have failed to realize — the US health care system, which includes workers’ comp medical care, has failed and failed miserably to keep costs down and to provide excellent care at lower cost.
That the medical-industrial complex and their political lackeys refuse to see this is a crime against the rights of Americans to get the best care possible at the lowest cost.
As I have pointed out in previous posts, the average medical cost for lost-time claims in workers’ comp has been rising for more than twenty years, even if from year to year there has been a modest decrease, the trend line has always been on the upward slope, as seen in this chart from this year’s NCCI State of the Line Report.
The authors of the HBR article asked this question: What if you could provide excellent care at ultra-low prices at a location close to the US?
Narayana Health (NH) did exactly that in 2014 when they opened a hospital in the Cayman Islands — Health City Cayman Islands (HCCI). It was close to the US, but outside its regulatory ambit.
The founder of Narayana Health, Dr. Devi Shetty, wanted to disrupt the US health care system with this venture, and established a partnership with the largest American not-for-profit hospital network, Ascension.
According to Dr. Shetty, “For the world to change, American has to change…So it is important that American policy makers and American think-tanks can look at a model that costs a fraction of what they pay and see that it has similarly good outcomes.”
Narayana Health imported innovative practices they honed in India to offer first-rate care for 25-40% of US prices. Prices in India, the authors state, were 2-5% of US prices, but are still 60-75% cheaper than US prices, and at those prices can be extremely profitable as patient volume picked up.
In 2017, HCCI had seen about 30,000 outpatients and over 3,500 inpatients. They performed almost 2,000 procedures, including 759 cath-lab procedures.
HCCI’s outcomes were excellent with a mortality rate of zero — true value-based care. [Emphasis mine]
HCCI is accredited by the JCI, Joint Commission International.
Patient testimonials were glowing, especially from a vascular surgeon from Massachusetts vacationing in the Caymans who underwent open-heart surgery at HCCI following a heart attack. “I see plenty of patients post cardiac surgery. My care and recovery (at HCCI) is as good or better than what I have seen. The model here is what the US health-care system is striving to get to.”
A ringing endorsement from a practicing US physician about a medical travel facility and the level of care they provide.
HCCI achieved these ultra-low prices by adopting many of the frugal practices from India:
- Hospital was built at a cost of $700,00 per bed, versus $2 million per bed in the US. Building has large windows to take advantage of natural light, cutting down on air-conditioning costs. Has open-bay intensive care unit to optimize physical space and required fewer nurses on duty.
- NH leverage relations with its suppliers in India to get similar discounts at HCCI. All FDA approved medicines were purchased at one-tenth the cost for the same medicines in the US. They bought equipment for one-third or half as much it would cost in the US.
- They outsourced back-office operations to low-cost but high skilled employees in India.
- High-performing physicians were transferred from India to HCCI. They were full-time employees on fixed salary with no perverse incentives to perform unnecessary tests or procedures. Physicians at HCCI received about 70% of US salary levels.
- HCCI saved on costs through intelligent make-versus-buy decisions. Ex., making their own medical oxygen rather than importing it from the US. HCCI saved 40% on energy by building its own 1.2 megawatt solar farm.
And here is the key takeaway:
The HCCI model is potentially very disruptive to US health care. Even with zero copays and deductibles and free travel for the patient and a chaperone for 1-2 weeks, insurers would save a lot of money. [Emphasis mine]
US insurers have watched HCCI with interest, but so far has not offered it as an option to their patients. A team of US doctors came away with this warning: “The Cayman Health City might be one of the disruptors that finally pushes the overly expensive US system to innovate.”
The authors conclude by stating that US health care providers can afford to ignore experiments like HCCI at their own peril.
The attitude towards medical travel among Americans can be summed up by the following from Robert Pearl, CEO of Permanante Medical Group and a clinical professor of surgery at Stanford: “Ask most Americans about obtaining their health care outside the United States, and they respond with disdain and negativity. In their mind, the quality and medical expertise available elsewhere is second-rate, Of course, that’s exactly what Yellow Cab thought about Uber. Kodak thought about digital photography, General Motors thought about Toyota, and Borders thought about Amazon.”
Until this attitude changes, and Americans drop their jingoistic American Exceptionalism, they will continue to pay higher costs for less excellent care in US hospitals. More facilities like HCCI in places like Mexico, Costa Rica, the Caymans, and elsewhere in the region need to step up like HCCI and Narayana Health have. Then the medical-industrial complex will have to change.
Just over four months ago, I published an open letter to the medical travel industry.
To date, I have had no response to my letter of December 14th, nor have I been invited to attend any of the conferences that have been held since, or will be held in the future, and I just learned of one at the end of this month in Washington, DC.
By that time, I will have been writing this blog for five and a half years, and still on a daily basis, my posts get at best, less than fifty views, and on most occasions, not even twenty.
I have posted them to LinkedIn, Twitter, and have re-posted them several times, and yet, each time, I get a few clicks added to the ones previously received.
I am putting my heart and soul in this and not receiving any compensation, although I should. So would it hurt if the industry paid a little more attention to my writing and to me, in lieu of actual remuneration?
As a friend we all know once said to me, “What am I? Chopped Liver?”
I am not doing this to stroke my ego, nor am I doing it because I have nothing better to do. I am doing it because I care. I am in the process of reading a fascinating book on the real reasons health care in the U.S. and elsewhere is undergoing major changes that have affected the delivery of health care, it’s cost, quality, efficiency, and its efficacy.
The least any of you could do is acknowledge my efforts and pay me some courtesy. Is that too much to ask?
I’ve met some of you in the past seven years since I began this journey, but I’d like to meet more of you. And I am sure you would like to meet me. I am funny and am a great person to know.
What say you?
Thank you very much.
Many of you have probably thought that going abroad for medical care after passage of ACA was a thing of the past, or that the idea that workers injured on the job would go abroad was a “stupid, ridiculous idea and a non-starter”, have forgotten that medical care in the US is the most expensive in the world.
But the simple, undeniable fact is that we spend too much on medical care and get very poor results and outcomes, while other countries spend far less and get better outcomes.
Why are we so stubborn? And why hasn’t the workers’ comp world realized that they are fighting an uphill battle to lower costs every time they come out with some new strategy or cost containment measure that never lives up to its promise industry-wide?
Sure, there are individual cases where these companies save money for a particular client, but overall, the cost of medical care for workers’ comp still rises, even if that rise is slow at times, or appears to have shrunk, only to rise once again the next year, as seen in the NCCI State of the Line reports.
An article yesterday in Salon.com said that traveling abroad for medical care simply makes more sense — even regular teeth cleaning is four times more expensive in the US than it is in Mexico.
One of the first procedures mentioned in the article involves a Minnesota couple who went out of the country for an in-vitro fertilization (IVF) procedure. On her fourth trip to the Czech Republic, it finally worked, and she got pregnant. The procedure in the US would have cost them between $12,000 and $15,000.
While IVF is not something that workers’ comp would cover, the fact remains that procedures cost far too much in the US, and in the case of IVF, only have a 29% success rate, according to a CNBC report cited in the article.
An estimated 1.7 million Americans traveled abroad for care in 2017, according the Josef Woodman, CEO of Patients Beyond Borders, and author of the same titled book. In my seven years of studying medical travel, Josef Woodman’s name has figured prominently in many articles and forums of discussion on the subject.
The article goes on to say that that is 10 times more than the 2008 estimate from Time magazine.
Some of the top destinations for medical care are: India, Israel (always go to a Jewish doctor first), Malaysia, Thailand, Taiwan, South Korea (unless that little twerp up north gets an itchy trigger finger), and Turkey.
However, there are other, more accessible destinations closer to home like Mexico, Costa Rica, Panama, etc.
Typical operations are orthopedic or spine surgery (are you listening work comp world?), reproductive operations, cardiovascular and eye surgery.
For example, a coronary artery bypass graft (CABG) in the US costs an estimated $92,000 (you could buy a couple of nice cars for that amount), whereas in India, the same operation would cost $9,800.
A total knee replacement (are you still listening ,workers’ compsters?) cost around $31,000 in the good ole US of A, but in Thailand, costs around $13,000. Tell me how you can save that much on a knee replacement using any of your so-called cost saving schemes?
These same operations in Costa Rica would cost 45 to 65% less than in the US, and would not require such long flights from most parts of the US. What are you waiting for? Save some money, I guarantee your insureds will love you for it.
Malaysia would be 60 to 80% less, but why go there when you can go to Costa Rica?
According to Woodman, medical tourism (travel) is a Band-Aid for the country’s dysfunctional health care system.
Woodman told Salon, “I don’t think you can penetrate this with philanthropy. It’s gonna be baby steps all the way. But in the meantime, medical tourism is a really important option.”
Woodman also said he did not like the term “medical tourism” because it is not a vacation. You may have noticed that I use the term “medical travel” instead. It is travel for medical purposes, and if there is tourism component to it, it is incidental to the reason for going in the first place.
Patients who cannot afford dental work, IVF or orthopedic surgery in the US, Woodman said, should consider travelling abroad. If their operation or treatment is expected to cost them $6,000 out of pocket, they will save money — even with the plane ticket.
Oh, by the way, that Minnesota couple spent, get this, only $235 for the IVF, not including flights. With such reasonable cost savings, it would be a no-brainer for workers’ comp to do the same.
But some people are stupid, ridiculous, and non-starters in my book.
This past Saturday, while waiting for power to be restored in my area due to a pesky lizard’s venture where lizards don’t belong, I was able to use my cell phone to read some posts on LinkedIn.
I came across a discussion by three of the top medical travel personnel answering the question, “Is the term “Medical Tourism” obsolete?”
This discussion thread was begun by Stella Tsartsara, and followed by Ilan Geva and Elizabeth Ziemba, including yours truly, who put his two cents into the conversation.
Since Stella has given me her approval to use her comments, and I suspect that Ilan and Elizabeth would not mind, I am going to quote them verbatim here for the reader to digest. There will be some names that I will leave out, because one, I have not contacted them, and two, they were mentioned in passing by the individual who I am quoting.
Stella I. Tsartsara:
“I see Elizabeth Ziemba talking about carrying capacity of HC systems. XXXXXXXXXXXXXXXXXX told me half of the international projects I do have nothing to do with Medical Tourism, XXXXXXXXXXXXXX told me we are dealing with “International Healthcare” anymore, we are passed the term “Medical Tourism ” probably instigated by people traveling to another destination for (cheaper) surgery not covered by their insurance where the “patient” had time to do some sightseeing. But once the demand came to more serious interventions like heart surgery then the only organization needed was a reliable MTF and good research from the patient to guarantee results. Here the “tourism” is at the 4-5th place after doctor, hospital reputation, waiting list time, safety, post- surgery follow up, price and cost reimbursement from insurance.
Now with the Cross Border Healthcare and the Trade in Services Agreement (TiSA) Wikileaks revelation on the globalization of healthcare officially by the states, things take a completely new turn and the fact that we are talking about Medical Tourism is raising some eyebrows. Or at least it should be split from Healthcare delivery.”
Stella I. Tsartsara:
“I have no possibility for edit, I rephrase here that XXXXXXXXXXXXXXXXXX told me some time ago that her projects deal with international healthcare mostly which is a healthy sign of evolution in the industry although XXXXXXXXXXX says this word does not exist either, to which of course I agree.
Terms are the beginning of taking the trend seriously by the demand. It’s about shaping policy in the end.”
“Stella, I think that the term Medical Tourism was pushed upon us by an association. The fact is no one, except our circle of Professionals, is using it or cares about it. In the effort to differentiate and stand out, many started to use Medical Travel, Global Healthcare…whatever. Patients don’t really care what you call it, they have a need or a want that requires a solution. Many of them are not looking for the “Tourism “aspect of a medical issue. Have you noticed that even the MTA is not using their name as much as they used to? They are now pushing the GHA brand.
Is that an indicator that medical tourism is dead? Who knows, and frankly, who cares? Globally, there are enough tremors in the healthcare sector, enough to guarantee continued movement of patients from one region to another. Maybe we should start calling it “Medical Voyages”?”
“Thanks for starting a very interesting conversation, Stella. The term “medical tourism” isn’t dead yet because it is still the top search term in the sector and is heavily used by the media. But the sector itself has outgrown the term. I will be giving a presentation at the IMTJ/World Health Care Congress about this very topic. The sector is changing but it is hard to get away from “medical tourism” when SEO rules. I must admit that the name of my company, Medical Tourism Training, was selected because of its SEO and familiarity to people. Even now, people react to it favorably even though I hate it. Time to look past the label to the substance.”
Stella I. Tsartsara:
“Ilan Geva “medical tourism” is not dead and maybe never dead as there are interventions where tourism plays an important part and here individual consultants have a bigger profit margin. But definitely movement of patients for elective treatment is not and cannot be called this way.
In EU we call it “Cross Border Healthcare” because we established the Institutional parameters for its organization and delivery.
This is what is lacking from an international perspective for the term to have a meaning. By the way trained eyes in institutional development like XXXXXXXXXXX will see immediately that the TiSA is exactly the same (with 2 additions on insurance and compulsory post-surgery monitoring & liability) with the EU Directive 24/11/EC on the Cross Border Healthcare in EU.”
“I have used “Medical Travel” in my posts, but for the purpose of selecting a category to place them in, or to tag them when I write, I use both “Medical Tourism” and “Medical Travel”.”
Stella I. Tsartsara:
“Elizabeth Ziemba & Richard Krasner, MA, MHA I tend to agree more with Ilan Geva on the matter. However as I said there will always be room for the “tourism” side for hundreds of treatments where tourism plays a very significant part like Medical SPA, cosmetic surgery, diagnostics, dental etc, although still I do believe that it’s not a priority. What Ilan said it’s a revelation for the “association”. Who else would give international care such a limited meaning maybe pushed by its operators back then.
But what is coming ahead e.g. Institutional and Regulative development of international healthcare (among public hospitals as well) has absolutely nothing to do with “tourism”. We have to set things straight if we want to be taken seriously by those who will be in our path in the consultation activities for its future development. Those who were (are still) building the TiSA are not going to look or refer to “medical tourism”.”
Stella I. Tsartsara:
“I also have the impression that something is moving in layers that are not yet visible to us, on the management of this new trend. I believe that actors are organizing themselves differently and as there is not yet a market (it’s still a taboo internationally exactly because it involves also public HC, we in EU have solved this but it’s not the case at global level) and the demand is still hybrid, there is no business development and marketing yet of this new consulting set of skills and delivery. But very soon we are going to see a new type of developers in this perspective catering for the state development of international HC. I have proposed years ago through this group the organization of such Groups combining inevitably many specializations and some do exist already run by big Hospital Groups.”
It would seem there is not clear consensus on what term is appropriate for the activity of leaving one’s home country and travelling to a second country for medical care, no matter what the reason for travel may be.
If, as Stella said, it was for heart surgery, doubtless the patient would not be doing much sightseeing post-operation. Yet, on the other hand, if it was for less invasive, and less stressful surgeries and procedures, and if the patient was cleared by the physician and physically able, then the tourism part would apply.
The revelations by Wikileaks of the negotiations on the TisA is no doubt a concern to the entire industry, whether one calls it medical tourism, medical travel, health tourism, health travel, etc. The result is the same. Knowledge of the existence of such an agreement may forestall that agreement being finalized, if not totally scrapped altogether if the right individuals lead a campaign against it in member countries.
Such was the case with Brexit, and such was the case with the 2016 U.S. elections that Wikileaks had a hand in derailing.
The solution, therefore is a stronger effort on the part of all stakeholders to develop strategies, plans, and standards to regulate the industry and to promote it effectively. Relying on an association we know is unreliable is not going to work. Before TiSA is tossed aside like the TPP, or the Paris Climate Treaty by nationalistic dunderheads, the industry must do more.
P.S. The rest of the thread can be seen here: https://www.linkedin.com/groups/4304089/4304089-6368077962927050755
Happy Holidays to all!
Hope you all had a good holiday.
Here is an article from Fierce Healthcare.com that describes what actions the city of Tucson, Arizona is taking to become a medical travel destination.
Readers of this blog will recall a few past posts that discussed cross-border medical travel, albeit due to an on-the-job injury. The article, NAFTA, Work Comp and Cross-Border Medical Care: A Legal View, discussed a Workers’ Comp claim in Arizona when a Mexican truck driver was thrown from his cab, received medical care first in Mexico, then in Arizona, as the state had changed their laws, and he was able to file a second claim.
A follow-up article, NAFTA, Work Comp and Cross-Border Medical Care: A Legal View: Update, reported the continued status of the driver’s claim.
Here is the article in its entirety:
Tucson aims to become medical tourism mecca
by Ilene MacDonald | Apr 10, 2017 11:36pm
Tucson, Arizona, is on a mission to become a healthcare and wellness destination for international visitors, particularly Mexican families with enough disposable income to pay for medical care in the United States.
The Tucson Health Association—which includes Banner Health, the Carondelet Health Network, Northwest Medical Center and Tucson Medical Center—hopes to entice tourists to come to the city for elective, nonemergency services, such as total knee replacements, the Arizona Daily Star reports.
Although some Mexican insurers will pay for certain procedures in the U.S., Felipe Garcia, executive vice president of Visit Tucson, which is also a member of the association, expects most visitors will likely pay out-of-pocket for the procedures.
“If your patient needs a certain procedure we have in the U.S., we’ll take care of it in Tucson, do the surgery and then we’ll send the patient back to Mexico where the provider there can take the next step with recovery,” Garcia said.
Tucson hospitals are hoping their efforts will be as successful as Texas Medical Center in Houston, a group of nonprofit health providers that includes MD Anderson Cancer Center and the Texas Children’s Hospital. Those provider attract 15,000 medical tourists a year, according to the article.
Medical tourism has become a lucrative business, for both healthcare providers and the local community, as visitors usually have extended stays in hotels and leased apartments, according to the article. Josef Woodman, CEO of the North Carolina-based Patients Beyond Borders, told the publication that approximately 250,000 medical tourists come to the U.S. for treatment each year and spend as much as $40,000 per patient.
To attract Mexican patients, Visit Tucson intends to develop a website in Spanish and hire a concierge to help patients connect with medical care in Tucson and navigate the healthcare system. It plans to market heavily to those who live in the Northern Mexico area due to geographical proximity. Eventually the association plans to market medical services to Canadian citizens.