Political Economy of Medical Tourism

♠ Posted by Emmanuel in , at 6/25/2007 12:22:00 AM
The clip above of a 60 Minutes segment features Bangkok, Thailand's Bumrungrad Hospital, which claims to have the most international patients of any medical operation in the world (BTW, its last syllable is not pronounced like StalinGRAD or LeninGRAD; it's BumrungRAD as I managed to confuse my Thai friend by pronouncing it wrongly). As you will see from the clip, it is furnished as grandly as any luxury hotel. Indeed, it is a very $eriou$ operation; you can even use your Thai Airways frequent flier miles toward paying for your medical expenses there. Fortunately, the medical care appears to be of a high international standard as well. If you're into click-and-watch, there's another clip by Focus Asia on Bumrungrad.

I recently became interested in medical tourism as a spate of recent articles have mentioned it. In particular, the publication of Josef Woodman's recent book entitled Patients Beyond Borders: Everyone's Guide to Affordable, World-Class Medical Tourism has attracted significant press coverage to the growing prominence of the medical outsourcing trade--especially in light of the ongoing debate over unaffordable and sometimes ineffective health care in the US. First up is this article by Arthur Frommer of the well-known Frommer's travel guides:

For a travel writer, there is no surer way to attract a barrage of hate mail than to suggest foreign travel for the purpose of obtaining medical or dental treatment. Immediately, dozens of U.S. doctors and dentists accuse you of putting people's lives at risk, since only U.S. doctors and dentists are able to safely treat us. And U.S. medical and dental treatments, as we all know, are the absolute best.

If the United States had universal medical and dental insurance, and every American was able to afford treatment here at home, I would not be disposed to argue the matter. But more than 40 million Americans are without such insurance and are unable to afford many elective treatments here at home.

The proposed remedy will, therefore, not go away. Outside the United States are medical facilities and myriads of doctors and dentists willing to charge modest sums within the financial reach of nearly everyone. And more and more observers are claiming such care to be impressive and safe, the frequent equivalent of what many wealthier or insured Americans are able to obtain at home...

Let's assume that the arguments for medical tourism or dental tourism — namely, going overseas to obtain such treatment — aren't completely established. Let's assume that an operation costing a fraction of what you'd spend in the U.S. is not always guaranteed to be the equivalent of what you'd obtain at home. What do you say to the American who can't afford such treatment at home? What do you say to the person who is able to afford medical or dental treatments only if he or she can go overseas to obtain them? Do you advise such Americans simply to pass them up and do nothing about their health?

In Patients Beyond Borders, Woodman claims that the quality of the foreign facilities he describes is impressively high. He makes that claim for, among others, several leading hospitals in Bangkok and Phuket, Thailand (cardiovascular treatments, orthopedics and ophthalmology, neurology, dental care and oncology); for hospitals in Cape Town and Mossel Bay, South Africa (including the famous Christiaan Barnard Hospital, which is noted for heart- and kidney-transplant surgeries); for several highly accredited clinics in Singapore; for hospitals and clinics of every sort in Mumbai, Bangalore and Chennai, India; for low-cost dentistry in Budapest and northwest Hungary (where thousands of residents of Vienna go each year for their dental work); for cosmetic and dental care in Prague; for cosmetic surgery in Brazil (including the clinic and institute of Ivo Pitanguy, the world's most renowned plastic surgeon); for the addiction recovery and fertility clinics of Antigua and Barbados. These facilities are discussed in detail, as are the methods of traveling and staying there, the anticipated costs and the accreditation they possess.

Medical and dental tourism are obviously part of an increasing globalization of life. Just as numerous high-quality commercial and manufacturing processes are now found overseas, it is becoming fairly obvious that the medical and dental professions of numerous foreign countries also are gaining fame. They also are gaining American patients who travel there for affordable treatment.

Joshua Kurlantzick of the New York Times also vouches for the quality of medical treatment at Bumrungrad while deriding the "care" he found back home. From a political economy perspective, he also notes that medical tourism may be sucking away health care professionals in the developing world from providing care to ordinary citizens. Eventually, a shortage of medical care provision for locals may trigger a backlash against these medical tourism operations:

...my Bumrungrad doctor, trained in America, immediately put me at ease. Surrounded by a gaggle of nurses ready to care for my every complaint at any time of day, the doctor informed me, ''We're pretty sure you have dengue fever,'' referring to a dangerous tropical disease also known as breakbone fever. My temperature had topped 104, but the doctor quickly determined I did not have dengue hemorrhagic fever, the worst strain of the disease. While I rested in a spotless room, he designed a program for my recovery, recommended a week of convalescence, and prescribed an array of medication for the searing joint pain. When I visited Bumrungrad's cashier, passing the hospital's high-end restaurants and plush waiting rooms along the way, an assistant handed me the bill. For admittance to the emergency room, a consultation, a room and bags of medications, the total cost came to less than $100.

My unscheduled visit to Bumrungrad taught me an old lesson -- and a new one. For decades, Americans have known they could obtain cheaper health care abroad, and have slipped off to Mexico for small surgeries or Canada for prescription drugs. But more and more people now recognize foreign hospitals can deliver not only cheap but also high-quality health care, and are considering medical tourism even for serious health problems. When I returned to the United States, in fact, I found myself longing for Bumrungrad. On a follow-up visit to an American doctor, I waited in a small room after telling him about my dengue fever diagnosis. After a while, when he hadn't returned, I poked my head into the hall, and discovered him thumbing through a book to find information about dengue fever...

But just as American travelers begin getting comfortable with the safety of foreign hospitals, they face a new question. With developing world hospitals focusing on medical tourists, some may take doctors away from understaffed public clinics in nations like India and Thailand, potentially leading to a public backlash against medical visitors. Already, the press in Thailand and India has warned that medical tourism, which can be more lucrative for physicians, is sucking doctors away from public clinics.

Only days after my luxury dengue treatment at Bumrungrad, I saw this other side. At a larger Thai hospital where I'd walked in after feeling my fever spiking, I sat on a hard bench in the middle of a waiting room littered with cigarette butts and empty plastic bottles. For over an hour, no one called me. When a nurse finally approached me, she warned there wouldn't be any doctors around for hours, and then turned and walked away. I got up and took a cab to Bumrungrad.

The Economist notes the development potential inherent in medical tourism. Also, a backlash from medical professionals in the developed world may emerge should medical tourism eat more into their share of the business:
America's soaring health-care costs, already $2 trillion a year, are predicted to double in the coming decade. Dissatisfaction with the rocketing price of care will only get worse as demanding and health-conscious “baby-boomers” hit retirement and start to suffer the costly ailments of old age. In countries like Britain and Canada, with supposedly universal coverage, state spending is not keeping up with growing demand, so patients face long and agonising waits for operations. And in the prosperous bits of Asia and the Middle East growing numbers of people are rich enough to demand high-quality medical care that they cannot get locally.

All this presents a fantastic business opportunity for those Asian countries, principally Thailand, Singapore and India, which have excellent private hospitals that are used to treating foreigners and where costs are a fraction of those in rich countries. “Medical tourism” is booming as patients look abroad for cheap, fast treatment, often combined with a holiday afterwards. Josef Woodman, the author of “Patients Beyond Borders”, a new guide for those seeking surgery abroad, reckons that 150,000 Americans did so last year, and predicts the numbers will double this year.

Booming demand is encouraging rapid expansion at big stockmarket-listed hospital operators such as Thailand's Bumrungrad and Bangkok Dusit, Singapore's Parkway and Pacific Healthcare and India's Apollo Hospitals. This week Pacific Healthcare said it would build seven medical centres across Asia. Bumrungrad, which treated 430,000 non-Thais last year, has just expanded its Bangkok hospital and is setting up in the Philippines and Dubai...

But the Asian hospital operators are now courting American health insurers and employers desperate to rein in soaring costs. Bumrungrad's marketing chief, Ruben Toral, who was in America this week for talks with insurers and big employers, says they were very keen. BlueCross BlueShield of South Carolina already offers Bumrungrad's cut-price treatments to members whose policies do not cover the surgery they need.

To reassure foreign patients, many hospitals are seeking accreditation from the Joint Commission International (JCI), the international arm of the body that accredits American hospitals. Thailand's Bumrungrad and nine Singaporean hospitals already have JCI certificates. Raymond Chong, the boss of Bangkok Dusit's Samitivej Hospital, reckons it will be only a year or two before big American insurers and employers routinely offer patients lower premiums if they are prepared to travel to a foreign JCI-accredited hospital for surgery.

For patients, employers and insurers the benefits are clear. But the hospital operators are bracing themselves for a backlash from the rich countries' medical vested interests whose jobs are, in effect, being outsourced. Expect much shroud-waving from doctors' associations and health-care unions as they highlight the few cases of foreign surgery that go wrong—as though such a thing never happens back home.

Finally, the FT too has another nice backgrounder, along with some advice on minimizing the chances of things going wrong should you want to give medical tourism a go:

Enter countries such as India, Thailand, Mexico, Costa Rica, Malaysia and Singapore that cater to the maladies of well-heeled foreigners. In fact about 150,000 Americans a year leave the US to have medical work done and the industry is growing by about 15-20 per cent annually. The quality of care in top hospitals is said to beat most American hospitals, while providing savings of 30-80 per cent. In fact, in 10-15 years, “the best offshore hospitals will routinely be included in networks offered to insured Americans”, predicts Arnold Milstein, chief physician for the consulting firm Mercer Health & Benefits.

Not that medical tourism is a worry-free venture. From the training of foreign doctors and the conditions of far-flung facilities, to the legal limbo should something go awry, to the wisdom of getting on long-haul flights after major surgery, there are troubling questions to consider. But when patients are facing a major operation – a hip replacement, say, that could cost anywhere from $55,000-$85,000 stateside – it seems that more Americans are proving able to get beyond their doubts.

“Many people just can’t afford the procedures here in the US and the value overseas is so much greater,” says Patrick Marsek, managing director of Chicago-based group MedRetreat, which is facilitating 650 overseas surgeries for clients this year. While historically most Americans have gone abroad for dental or cosmetic work, he says, it is now extending to other areas – hip and knee replacements, heart surgery and hysterectomies.

Indeed, there is now a cottage industry growing up around medical tourism, led by companies such as MedRetreat and Planet Hospital. Not just in the US, but in countries with creaky national health systems such as the UK, where lengthy waiting lists for non-emergency surgery have spurred many to look abroad. “Now you can buy a travel package where they’ll literally handle everything for you,” says David Hancock, author of the newly published guide The Complete Medical Tourist. “They pick you up at your front door, take you to the airport, fly you in and accompany you to all clinical visits and operations. Then you’re off to a five-star hotel to recuperate for two weeks, before flying you back and getting a private car back home. And it all comes in at half of what it would be at a private hospital in the UK...”

So why isn’t everyone jetting off for a few dental crowns or a tummy tuck? For one, heading abroad will put you in a hazy legal zone should anything go wrong. Where a botched surgery might lead to a multi-million-dollar settlement in the US, malpractice awards abroad tend to be capped at a much smaller amount – never mind the potential nightmare of navigating through a foreign legal system.

To avoid ham-handed foreign surgeons, remember that all venues are not created equal. If a hospital has only done 50 relevant surgeries and cannot produce success rates or dossiers on their top surgeons – who have ideally been board-certified in the US or Europe, before returning to their home countries – steer clear.

To do medical tourism right, there are a few key steps to take. Whether you are on your own or working with a healthcare planner such as MedRetreat, look for hospitals accredited by the nonprofit Joint Commission International, and those affiliated with top American institutions.

As your search narrows, do your due diligence and find out how many surgeries your target hospital has performed, and what the documented success rates are. To wit: Wockhardt Hospital in India, which caters to foreigners, has a success rate of 98.4 per cent after 15,000 cardiovascular surgeries, which compares favourably with any US hospital and means “you won’t be coming back with a scalpel in your belly”, Woodman says.

With that in mind, here is the list of Joint Commission International (JCI) accredited organizations worldwide. Plus, here is a sample of national medical providers that have banded together to promote their services from India, Singapore, and the Philippines. The three main political economy questions, as I see it so far, are these:
  • Will the quality of medical services for local residents diminish as more health care professionals serve the medical tourism trade?
  • Will there be a backlash among developed-world health care professionals as more medical tourists go abroad in search of treatment?
  • Can medical tourism promote development?
On the last point there is an interesting book forthcoming concerning Medical Tourism in Developing Countries that looks quite interesting. It is more of an academic work though in contrast to the how-to emphasis of the Woodman book. Here's its description:
Western patients are increasingly traveling to developing countries for health care and developing countries are increasingly offering their skills and facilities to paying foreign customers. This international trade in medical services has huge economic potential for developing countries and serious implications for health care across the globe. The potential is explored in this book through analysis of the market for medical tourism and identification of its link to economic growth. The authors propose that medical tourism is not a universally feasible growth strategy. Instead, it is successful only in countries with economic and political advantages that enable them to navigate around international and domestic obstacles to trade in medical services. It is also suggested that a successful medical tourism industry, when coupled with cooperation between the private and public sectors, may lead to public health improvements in developing countries.