Market Driven Health Care May Be Outsourced

Judy Dugan writes in the Los Angeles Times that foreign hospitals and medical centers are wooing U.S. insurance companies and major employers. The goal? To make “medical tourism” a regular part of America’s market-driven health care system.

Right now, medical tourism is an individual choice. People who have been dumped out of the U.S. health care system but who have the money to travel can get their hip replacements and cancer treatments in another country at the fraction of the cost.

But unless Congress gets its act together and takes the insurance industry into hand, soon “American workers may find themselves facing ‘incentives’ for overseas surgery that border on coercion,” says Dugan.

For insurers and employers looking at a $45,000 hip replacement in the U.S., the lure of a $5,400 hip replacement in India — even with $10,000 or $12,000 in travel and lodging costs added on — is hard to resist. So what if there’s a lack of public, comparative data on outcomes, complications and long-term recovery?

Doctors in other countries make a fraction of what U.S. doctors do. U.S. physicians may find themselves in the same fix as U.S. garment workers, competing with workers in the Third World. Patients also may have to sign waivers that free their foreign health care providers from any liability for error or malpractice.

Here are a few early indicators of insurer interest: The Blue Cross Blue Shield website touts “Blue Cross’ Companion Global Healthcare,” a wraparound travel planner and network of overseas providers, selling to individuals and to employers in South Carolina. In California, Blue Shield and HealthNet offer plans for employers of Mexican immigrants that cover treatment in Mexico. And United Health Group, the parent of PacifiCare, sent a speaker to the medical tourism conference to advise on how to get employers to include overseas surgery in health plan networks.

Conservatives want to de-subsidize health care and allow the magical free market to determine cost and delivery. Outsourcing overseas is a logical consequence.

Update: However, as Nicholas Kristof points out — we may get better care by going overseas. Our health care system, in spite of being the best health care system in the world, isn’t that great.

14 thoughts on “Market Driven Health Care May Be Outsourced

  1. Let’s not forget that those Indian doctors were all likely trained in the U.S. but found it far more profitable and beneficial to open facilities in India than the U.S. for any number of reasons and prohibitive to do so here.

  2. more profitable and beneficial

    Skipping out on their student loans, maybe? I think it’s a tad chauvinistic to think “all those Indian doctors” were trained in the U.S.

  3. Actually … that would be pretty cool if my insurance plan covered that … you get actual affordable treatment AND a trip to a foreign country! Of course the nature of the beast is that you’ll proibably be too sick to enjoy the vacation, but still….

    And if that started to happen a lot, perhaps ALL of the non-insurance-company parts of the US health care industry would suddenyl become big proponants of reform….


  4. I hate to say it, and I don’t like it, but I suspect medical tourism is an idea whose time has come. I read a couple years ago of some large health insurance company (was it Blue Cross?) proudly touting this on their official company website (possibly the “Companion Global Healthcare” cited above). And I know of people who’ve had particular surgeries done outside the US, and were happy about it, as do probably many of your readers.

    It’s much more than just garment workers who’ve had to deal with this kind of globalization – it extends to so called “knowledge workers”, such as engineers, accountants, and so on, and now doctors and medical staff, that can be drawn on from anywhere in the world. Cheap travel and good communication abolishes distance, and so these professionals can live anywhere. The web makes it possible for people to meet up, and conduct business, regardless of where they happen to live.

    Ages ago, when I worked as a computer programmer at GE, the company was just starting to experiment with outsourcing software development. There were a number of small pilot projects going on throughout the whole company, as a way to gain experience with the various players in India. The goal was to winnow out the good ones that could be trusted to do the work competently – these would then gain some sort of company wide certification, an award that would open the doors for more work.

    And so I suspect something similar will happen with outsourced medical, if it hasn’t already. I’m sure the insurance industry has a list of trusted offshore providers that it customarily refers clients to.

    All of this is sadly a gigantic leveling of the playing field, where whatever economic advantages US workers once enjoyed, are being levelled by advances in communication and cheap travel. I don’t see any point in fighting to retain the old structure of things, which is passing. I’m a lot more interested in figuring out how to adapt, and to take advantage of what is emerging.

  5. A few years ago my wife need surgery not covered by her insurance. She did some research and found that we could have the surgery in France and stay for three weeks for about half of what the surgery cost in the good old USA. In fairness, we stayed in cheap, but comfortable hotels. We would have saved more if we had known about “gites” at the time.

    It gave us a very healthy respect for the French way of practicing medicine. Their infection control was excellent, their facility was well fitted to its purpose without needless frills. It made sense. You could for example, open windows and let a summer breeze and the sun come in, which is probably one of the best things to do to make the hospital environment healthier. Their outcomes were superior as compared with the same surgical procedure here. You don’t even have to go to India or take on increased risk to save money.

    Our approach in the US always seems to be some variant of the Wal-Mart model: Cheap labor, looser interpretation of the standard of care and reduced liabilty, backed by great PR and advertising campaigns…. and Bob’s your uncle!

  6. Republican Health Insurance Reform Bill Insures Almost Nobody

    By 2019, CBO and JCT estimate, the number of nonelderly people without health insurance would be reduced by about 3 million relative to current law, leaving about 52 million nonelderly residents uninsured. The share of legal nonelderly residents with insurance coverage in 2019 would be about 83 percent, roughly in line with the current share.

  7. It’s a question for Paul Krugman but there’s a bigger economic issue here that makes me nervous. I am old enough to have witnessed in my liftime the evilution of ‘Japanese junk’ to quality products made for less than we were making comperable items. I am old enough to remember Nixons visit to china, and watch over decades as American (union) industries were dismantled and exported. I am old enough to remeber how the technical revolution was going to produce high-paying jobs and lower paying support jobs. As Monbat said, a big chunk of the programming jobs are offshore, and if you call AOL for thech support, you are talking to an consultant in India. Customer support you thought was immune, like for big banks, is also overseas.

    There are mid-east countries where almost the entire work force is foreign. The residents do nothing and are filty rich sitting on oil reserves. But what are we sitting on besides our butts and our arrogance if we outsource all the jobs – including medical ones along with the manufacturing and technology and support? Just what (please answer Paul K – because I don’t know) is going to support the economy of the USA?

  8. I have a friend who went to Germany for surgery several years ago.
    He had an experience similar to what goatherd described. Many Americans make the mistake of thinking everything beyond our shores is the third world, even some of the third world is not “the third world”.

  9. Yes, Goatherd’s experience with surgery in France sounds like it was rather pleasant, but I’m trying to imagine what someone with kids and a spouse with a job would do if they had to have surgery overseas — go by themselves? There’s an old saying, There’s two places you need a friend on the outside, the joint and the hospital.

  10. Last summer when I was researching my Masters paper on Bulgaria’s history someone told me about a good dentist and I got my teeth cleaned for 20 bucks. The facility was brand spanking new and the nurses all spoke English. Lots of English people are going to Eastern Europe for dental work now and that facility has opened up to cater to them. I would go back every year if I didn’t have to buy a 1000 plane ticket to get there…

  11. This protest underwritten by:

    Americans for Prosperity (AFP), the corporate front group founded in the 1980s by Koch Industries billionaire David Koch, worked closely with Rep. Michele Bachmann (R-MN) to orchestrate the anti-health reform rally today. As ThinkProgress reported yesterday, AFP has been encouraging right-wing activists to board their buses — free of charge — to attend the rally. While AFP does not disclose all of its corporate donors, foundations controlled by David and Charles Koch provide millions in yearly funding, and David continues to chair the AFP foundation and preside over AFP’s annual convention.

    ThinkProgress found at least a dozen AFP staffers standing at their designated bus drop off point near the Capitol, handing out signs, directions, talking points, petitions, and donuts to protesters. Many of the people who work at AFP are longtime Republican operatives, like Ben Marchi, the AFP Virginia director who previously worked for the National Republican Congressional Committee and for Rep. Tom Delay (R-TX). Victor Zapanta produced this video report of AFP staffers talking about their exploits at the rally today:

    AFP STAFFERS: We have 25 buses just from Pennsylvania, New Jersey we probably have 5 or 6 from Maryland.

    AFP STAFFERS: We have about 40 buses coming.

  12. Who knows about the loony people going out there and protesting against a more equitable health care system? I just think they look crazy and I don’t see how its even important who assists in organizing them! If corporations or organizations did not assist with the scale of a large political protest they would be very unwieldy to do…

    The people are being manipulated by the media for sure. On a side note, my local liberal talk radio station just got switched back to conservative. Meaning now their are three conservative radio stations calling Obama a “socialist” all day long! Obviously as someone who knows what the definition of socialism is, I beg to differ, but the radio hosts are just somewhat disarming and because they are always on the air people lose the capacity of independent critical thought.

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