Imagine you are one of the 45 million Americans that have little or no health insurance. Now, imagine that

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1 by Julie Barmeyer The Next Generation of Vacations - Medical Tourism - Imagine you are one of the 45 million Americans that have little or no health insurance. Now, imagine that your doctor recently told you that you would need to undergo a heart-valve replacement surgery to save your life. To add to your dilemma, the operation will cost up to $200,000 out of pocket. Fortunately for you, the emerging trend of medical tourism can help. By traveling to India, you can have the operation for a mere $10,000. In 2004, this very situation happened to Howard Staab and many others in similar predicaments. 1 Medical tourism has been a growing industry ever since the development of medicine. According to Wikipedia.org, medical tourism is the act of traveling to another country to obtain dental, medical, and surgical care. 2 Europeans and Americans have frequented foreign spas and healing sites for years. Switzerland, for example, had 25,000 patients in 1997, grossing over $340 million in revenues. 3 Many other nations have realized the potential profits and have begun expanding the number of hospitals and procedures. With an increased level of international communication and globalization, medical tourism has become increasingly popular with Americans. For some, medical tourism is a necessity, not just a fad. The health insurance predicament coverage continues to appear on politicians to do lists. With the health care crisis in the United States, medical tourism continues to grow, promising to become a significant trend in the years to come. Typically, international hospitals provide a wide range of surgeries, from tummy tucks to hip replacements. These hospitals are located in various nations and regions. Southeast Asia, namely India, Thailand, Singapore, and Malaysia, boast the hospitals with the highest quality and the lowest prices. The governments of these nations fully support this expanding industry and encourage their affluent citizens to invest in medical tourism. The Malaysian Health Minister illustrated this fact in a 2003 press release saying that the [Malaysian] Government was making efforts to expand the health tourism industry in a big way and had identified health tourism as one of the potential growth areas in the country s tourism industry. 4 Industry hospital chains, such as the Escort Hospitals and the Wockhardt Hospital Group, continue to expand in their countries. 5 Numerous internet agencies, such as Planethospital.com, create quasi-vacation packages for potential customers. These all-inclusive packages consist of airfare, transportation, pre-operation lodgings, the actual operation, post-operation lodgings, and sometimes even sightseeing specials. Medical tourism appeals to an extensive range of clients due to these alluring aspects. A large number of medical tourists come from under- or un-insured Americans. These 45 million uninsured Americans, who slip through the cracks of American health care, can now turn to foreign countries for less expensive procedures. The dramatic differences in costs between the United States and a medical tourist country

2 like India are highlighted in Table 1 (See Appendix). For example, American Kevin Miller traveled to Thailand in 2005 to have a herniated disk repaired. The operation would have cost the uninsured Miller $90,000 at home; fortunately for him, it cost only $10,000 in Bangkok. 6 Patients, like Miller, who don t qualify for Medicaid but can t afford insurance on their own, turn to medical tourism as their only feasible option for recovery. l the search for affordable healthcare Medical tourism attracts American patients for numerous reasons, but the low prices have the largest draw. In fact, the prices equal about one-tenth to one-fourth of the American cost. Several factors account for these low prices. The main reason is the differences in malpractice insurance rates. In India, medical malpractice insurance for a heart surgeon costs about $4,000 a year, but in New York it costs about $100, These private hospitals can also charge less for procedures because pay scales for employees are much lower. The standard of living in foreign countries does not compare to the United States and workers can survive on much lower salaries. In addition, the high volumes of patients at these hospitals allow for decreased prices since there is a sharing of fixed costs. While patients originally used medical tourism namely for cosmetic surgeries, the field has expanded to include all types of elective surgery. Cosmetic surgery patients frequently have operations performed in other cities in order to stay discrete or avoid social scandal in their hometowns. Medical tourism allows potential patients to travel to a foreign location and have the procedure done, resolving two potential concerns for a client. Interestingly, cosmetic surgeries only accounts for 17% of American surgeries performed at the Bumrungrad Hospital in Bangkok. 8 The cost effective features of medical tourism offer the middle class the chance to undergo cosmetic surgery, an option they often cannot afford in the United States. Again, the rising U.S. costs for these cosmetic procedures may prove too much; thus, patients can turn to medical tourism as a solution. While the prices can catch any potential client s eyes, the high quality of the hospitals make them feel much more comfortable about having surgery abroad. 9 These medical tourist hospitals have state-of-the-art facilities and equipment, which are in more pristine condition than many American hospitals (See Illustration 1 in Appendix). 10 For example, the Escorts Research Center in New Delhi has a death rate of.08% for coronary bypass patients, whereas the New York-Presbyterian Hospital, the hospital where former President Bill Clinton underwent surgery in 2002, has a death rate of 2.35%. 11 Many have staff doctors trained in the United States and the United Kingdom and some physicians even have American accreditation. 12 Besides the amenities and quality of the hospitals, a sense of adventure draws potential patients to medical tourism. 13 Some former medical tourists have cited this as the only chance they would get to see such places as India, Thailand, and Malaysia. In some of the package deals, patients can schedule sightseeing trips ahead of time. For example, patients may also stop over to see the Taj Mahal in India or recover from surgery on the resort beaches of Phuket in Thailand. 14 The available medical tourism packages make hospitals trips a little more exciting and appealing to adventurous Westerners. l skilled surgeons & risky conditions Although medical tourism offers various benefits, risks do exist for the medical tourist. India, Thailand, and Malaysia still remain developing countries, giving many Americans apprehensions about the safety and nature of the nations. Thailand, the sex capital of the world, has one of the highest rates of HIV. Also, in the past year, 12 people have died from the Avian flu in Thailand. In all three countries, large disparities exist between the private hospitals and the local public hospitals. For instance, in India, there are only four doctors for every 10,000 patients and the government only spends 5.1% of the gross domestic product on health care. These figures present a stark contrast to the United States who boasts 27 doctors for every 10,000 patients and spends 14% of the GDP on health care. 15 According to an article in The Financial Times, The sight of the country s

3 overcrowded public hospitals, open sewers and garbage-littered streets would unsettle most visitors confidence about public sanitation standards in India. 16 In addition, while the doctors in medical tourist hospitals may have trained in Western nations, the nurses and other staff members may not have and standards of quality and care may be lower. 17 From a medical point of view, numerous mainstream doctors discourage medical tourism since it requires flying abroad for a surgery. The distance between home and the hospital makes post-operative care and follow ups nearly impossible. As Dr. Robert Barmeyer, a leading OBGYN from Southern California illustrates: One of the concerns is that a patient develops a significant complication from a procedure and the original doctor is not available to asses what has gone wrong. Complications develop even from procedures performed by the best surgeons. Also, when a patient takes a 15 hour plane ride home after a surgery, there is a significant risk of blood clotting that could lead to a deep vein thrombosis or an embolism. 18 The Bumrungrad Hospital will, however, redo a surgery if a patient does not feel satisfied with the results and will refund patients if their disappointment persists. Also, in general doctors do not recommend flying soon after an operation; with medical tourism, this time frame is usually only about three to four days later, depending on the procedure. The medical concerns against medical tourism are valid points and patients must weigh the risks against the plentiful benefits. As the costs for insurance increase in the United States, numerous small to midsized firms have begun to offer medical coverage for their employees through medical tourism. 19 While the companies could not afford health coverage by typical American standards, they can now offer great benefits to their employees. In addition, some of the extra money that the companies save on HMOs goes back to the employees. 20 [I]nsurers may be more willing to pay airfare to Asia than costs for recovery in a Western hospital, describes one article. 21 This option, while slightly unfamiliar at first, makes insuring small companies more feasible. Apart from the United States, citizens of other developed countries, such as Canada and the United Kingdom, use medical tourism as an option for procedures. 22 Canada and the U.K. both have government operated health care systems that differ from the private American system. Commonwealth citizens cite long waits for elective surgeries as a frustrating problem that only seems to worsen. While some surgeries, like cosmetic surgeries, are legitimately elective, other surgeries fall into the semi-elective category. These surgeries should not be put off for extensive amounts of time though. [I]f you wait six months for a heart bypass you may not need it anymore, says Prathap Reddy, the founder of Apollo Hospitals in India. 23 Naresh Trehan, founder of Escorts Heart Institute and Research Center in New Dehli, India, echoes the same sentiment by saying, If you can wait for two years for a bypass surgery, then you don t need it or you re dead -- one of the two. 24 In Canada, some wait times can be up to two years, while in the UK the wait times are even longer. Currently, many Canadians travel to the United States for cosmetic surgery to avoid long waits. l a growing international trend Despite the potential downsides to medical tourism, patients from around the world seek the benefits of this emerging trend. Southeast Asia leads with the number of clinics opening right now. But more and more countries have discovered the profitability of medical tourism and have started building their own private hospitals. The Dubai Healthcare City will become the largest medical center in between Southeast Asia and Europe when it opens in Though its prices will run a little higher than its competitors, it will also host a new branch of Harvard Medical School. Brazil has also become quite renowned for its cosmetic surgery clinics, which cater largely to North and South Americans. In Central America, Costa Rica and the East Indies have become hot spots for North Americans. 26 According to one doctor, Costa Rican surgeons offer a variety of cosmetic procedures, including tummy tucks and full dental restorations, all at bargain prices, and Barbados offers infertility treatments. 27 With the dispersion of knowledge through improved communication and

4 technology, many more nations have the ability to play host to medical tourism. With the increasing number of patients going abroad for surgery, medical tourism could significantly impact the United States. More Americans can have operations that they need for their physical health or operations that promote their mental well-being. With all of the inadequacies of the American health care system, medical tourism offers a solution to the under- and un-insured citizens who deserve the chance to promote their health. As more and more success stories reach the media, the number of medical tourists should increase even more. According to Uwe Reinhardt, a leading authority on health care economics at Princeton University, [medical tourism] has the potential of doing to the U.S. health-care system what the Japanese auto industry did to American carmakers. 28 With the emergence of companies offering benefits that include medical tourism and outsourcing, the number of insured Americans may increase, but at the expense of American-based hospitals. As a consequence of medical tourism, U.S. hospitals may not see the same levels of revenues that they have in the past. With the outsourcing of expensive health care procedures, some American hospitals likely will lose money. Hospitals make most of their revenue on expensive, elective procedures. When patients turn to foreign hospitals for procedures, the fixed costs per patient increase, leading to a decrease in the hospitals net income. The exorbitant costs of today s health care have led to the startling number of uninsured Americans: 15.6% or 45 million people. 29 By the redirecting of this business to foreign companies, U.S. hospitals may begin to feel the effects of their high prices. Even though international hospitals exist in numerous countries, the clientele, up to this point, has mostly consisted of people from neighboring nations. Most patients come from Asia, Africa, and the Middle East where top doctors usually do not stay in their home nations. 30 For Americans and other Westerners, the achievements of these clinics continue to grow and more and more people have become aware of their benefits. So far, the first Westerners have tended to come from emigrant families that still have family in their former nations. 31 The first and second generation expatriates come back home with news of wonderful vacations with successful surgeries on the side. Deep Kalra, the CEO of the medical tourism company makemytrip.com, says there is a potential market of some 12m expatriate Indians who would combine regular visits to India and save time and money by undergoing non-emergency procedures such as eye operations, dental work, cosmetic surgery and knee surgery. 32 As the stories of first rate surgeries at cost effective prices continue, the number of medical tourists increases. In 2003 alone, 150,000 foreigners traveled to India for medical tourism. 33 Indian officials expect the number of patients to increase by 15% over the next few years. Americans have become increasingly more comfortable with the idea of medical. For example, the Bumrungrad Hospital in Bangkok treated 55,000 American patients in 2005, a 30% increase from The worldwide trend of medical tourism continues to grow, especially amongst Americans and other Westerners. l an incentive for reform in the U.S. The benefits of medical tourism have stirred many to consider this unorthodox option. Health care in the United States has been a topic of debate for the past several decades. The U.S. remains the only Western country that does not have a public health insurance system. While the publicly funded Medicare and Medicaid do provide help, the rising costs of health care make these government programs highly sought after and difficult to qualify for. The government spent $473 billion on Medicare and Medicaid in 2004 but 45 million people remained uninsured. 35 Legislators continue to debate various options, but the federal government s current reimbursement plan makes Medicaid and Medicare patients often undesirable to doctors, especially good ones, due to the low reimbursement rates. 36 In addition to the rising costs of technology and inflation, doctors pay such high malpractice insurance that many private practice doctors struggle to stay afloat. This worsening malpractice insurance debacle forces doctors to practice defensive medicine where they make decisions based on a fear of being sued rather than

5 necessity. 37 Unfortunately, this causes more unnecessary tests and procedures leading to further rising costs. This downward spiral of factors has created an enormous health care crisis in the United States that will not be easy to fix. Until the necessary changes in American health care become a reality, Americans may need to turn to other sources to remedy their problems. Medical tourism has a definite place in American society due to the ineffective health care coverage in the U.S. and the inability of our political leaders to fix the faults in the system at this time. While medical tourism may not be a perfect option for all Americans, it certainly can help numerous people for the time being. If costs of health care continue to rise and world continues to shrink because of technology, innovative approaches to health care will be the trend. Until the health care system changes, Americans will look overseas and possibly have a great vacation along the way. l appendix l Table 1: This table highlights the differences in prices for procedures in the United States and India (taken from Medical-Tourism-India.com) Procedure Cost (US $) United States India Bone Marrow Transplant 2,500,000 69,000 Liver Transplant 3,000,000 69,000 Heart Surgery 30,000 8,000 Orthopedic Surgery 20,000 6,000 Dental Implants 3, Illustration 1: The entrance and interior of the Bumrungrad Hospital in Bangkok l works cited l American Medical Association Online.. Physicians react to projected Medicare physician payment cuts. 16 March September Barmeyer, Robert A. Personal Interview. 12 September Cannon, Michael F. and Michael D. Tanner. Healthy Competition: what s holding back health care and how to free it. Cato Institute: Washington, 2005.

6 Greenberg, Brad A. Have Ailment, Will Travel. The Los Angeles Daily News. 7 August September Health Care Tourist.com. The Process. 7 November Kasturi Dewi, K. Hospitals set fees for health tourism. The Star. 28 Oct The Association of Private Hospitals of Malaysia. Kher, Unmesh. Outsourcing Your Heart. Time.com. 21 May September time/magazine/article/0,9171, ,00.html Lancaster, John. Surgeries, Side Trips for Medical Tourists. The Washington Post Online. 21 October September Marcelo, Ray. India Fosters Growing Medical Tourism Sector. The Financial Times. 2 July September NBC News. NBC. 20 February September Thai Websites. Health Care in Thailand 7 November Todd, Stephen. Medical Tourism Saves You Money, But Which One Is Best?. Ezine Articles.com. 7 September Uretsky, Samuel D. The Thailand Tuck. MedHunters.com. 9 May September medhunters.com/articles/medicaltourism.html U.S. Census Bureau. Poverty: Health Insurance Coverage in the United States. 13 October September Wikipedia: the free encyclopedia. Health Care System. 11 Sept Wikipedia: the free encyclopedia. Medical Tourism. 11 Sept l about the writer l Julie Barmeyer is a junior in the Marshall School of Business. She plans on graduating in May 2008 with a B.S. in Business Administration and a minor in French. The native San Diegan has enjoyed all of the benefits that USC has to offer and is very active in her sorority where she is President. Julie submitted this article in response to Professor Eric Roth s Trend Analysis Assignment in his WRIT-340 class. l notes l 1. Lancaster. Surgeries, Side trips for Medical Tourists 2. Medical Tourism. Wikipedia.org 3. Uretsky. The Thailand Tuck 4. Kasturi Dewi. Hospitals set fees for health tourism

7 5. Kher. Outsourcing Your Heart 6. Kher. Outsourcing Your Heart 7. Lancaster. Surgeries, Side trips for Medical Tourists 8. Kher. Outsourcing Your Heart. 9. Kher. Outsourcing Your Heart 10. Lancaster. Surgeries, Side trips Lancaster. Surgeries, side trips for medical tourists. 12. Kher. Outsourcing Your Heart 13. NBC News 14. Lancaster. Surgeries, side trips for medical tourists 15. Lancaster. Surgeries, side trips for medical tourists. 16. Marcelo. India fosters 17. Uretsky. The Thailand Tuck. 18. Robert Barmeyer. Personal Interview. 19. Kher. Outsourcing Your Heart 20. Kher. Outsourcing Your Heart. 21. Uretsky. The Thailand Tuck. 22. Ibid. 23. Uretsky. The Thailand Tuck Lancaster. Surgeries, Side trips 25. Todd. Medical tourism saves 26. Ibid. 27. Uretsky. The Thailand Tuck. 28. Kher. Outsourcing Your Heart 29. U.S. Census Bureau. 30. Lancaster. Surgeries, side trips 31. Marcelo. India fosters Medical tourism 32. Ibid. 33. Lancaster. Surgeries, side trips 34. Kher. Outsourcing Your Heart. 35. Cannon pg Robert Barmeyer. Personal Interview. 37. Cannon pg Thai Websites. Health Care in Thailand. 7 November Health Care Tourist.com. The Process. 7 November l works cited l American Medical Association Online.. Physicians react to projected Medicare physician payment cuts. 16 March September Barmeyer, Robert A. Personal Interview. 12 September Cannon, Michael F. and Michael D. Tanner. Healthy Competition: what s holding back health care and how to free it. Cato Institute: Washington, Greenberg, Brad A. Have Ailment, Will Travel. The Los Angeles Daily News. 7 August September

8 Health Care Tourist.com. The Process. 7 November php?page=process Kasturi Dewi, K. Hospitals set fees for health tourism. The Star. 28 Oct The Association of Private Hospitals of Malaysia. Kher, Unmesh. Outsourcing Your Heart. Time.com. 21 May September time/magazine/article/0,9171, ,00.html Lancaster, John. Surgeries, Side Trips for Medical Tourists. The Washington Post Online. 21 October September Marcelo, Ray. India Fosters Growing Medical Tourism Sector. The Financial Times. 2 July September NBC News. NBC. 20 February September Thai Websites. Health Care in Thailand 7 November Todd, Stephen. Medical Tourism Saves You Money, But Which One Is Best?. Ezine Articles.com. 7 September Uretsky, Samuel D. The Thailand Tuck. MedHunters.com. 9 May September medhunters.com/articles/medicaltourism.html US Census Bureau. Poverty: Health Insurance Coverage in the United States. 13 October September Wikipedia: the free encyclopedia. Health Care System. 11 Sept Wikipedia: the free encyclopedia. Medical Tourism. 11 Sept l bibliography l Aaron, Henry J., William B. Schwartz, and Melissa Cox. Can we say no? the challenge of rationing health care. Brooklings Institution Press: Washington, Cogan, John F., R. Glenn Hubbard, and Daniel P. Kessler. Healthy, Wealthy, and Wise: five steps to a better health care system. AEI Press: Washington, Richmond, Julius B., and Rashi Fein. The Health Care Mess: how we got into it and what it will take to get out. Harvard University Press: Cambridge, The White House Domestic Policy Council. Health Security: the President s Report to the American People. October 1993.