Medical tourism draws growing numbers of Americans to seek health care abroad

April 4, 2011

When my father had a toothache, he saw a dentist in Boston who recommended a root canal and dental crown costing about $2,000. He decided to wait until he was in India, his native land, for holidays and had the procedure done there for $200. Extremely satisfied with the service and the price, my mother decided to have her two front teeth replaced, eliminating a wide gap that tarnished her smile, and estimated she had saved $3,000.

According to Deloitte consulting services, 875,000 Americans like my parents were medical tourists in 2010, traveling outside U.S. borders to receive health care: dental work, elective hip replacements, even bypass surgery.

I hadn’t given medical tourism or outsourcing much thought until a few months ago, when I was at the Narayana Hrudayalaya (NH) Hospitals in Bangalore with Devi Shetty, the founder of the medical complex and a pediatric cardiothoracic surgeon.

Shetty told me bypass surgeries cost his patients $2,000 to $5,000, a tenth of what it would cost in the United States. As a U.S.-educated doctor, I wasn’t sure whether I should feel threatened by or marvel at Shetty’s setup. But I was curious, so I asked him how he was able to realize such savings.

His formula was simple: Focus on the process and on volume. “If you are investing heavily in the process, the product naturally will be good,” he told me. Just as Wal-Mart capitalizes on the power of bulk purchasing, Shetty has applied process and volume principles to his hospitals, using innovation and well-tested surgical techniques developed in the United States.

Devon Herrick, a policy expert at the National Center for Policy Analysis, a think tank based in Dallas, identified other factors that make foreign hospitals less expensive: lower labor costs certainly, but also fewer third-party payments, price transparency, limited malpractice liability and fewer regulations.

As I spoke with Shetty, I was reminded of the epiphany Tom Friedman experienced when he conceived his book “The World Is Flat” after meeting with the founder of Infosys. Could health care become globalized and a level playing field, much like the software industry? Shetty’s hospitals are just a stone’s throw away from the high-tech, oasis-like campus of Infosys, an information technology company with more than $5 billion in annual revenue.

American health-care dollars are bound to be a prime target for providers overseas. But I was worried about the quality of health care in a developing country where the tap water is unsafe for drinking.

Shetty, 54, wearing a surgical cap and sea-blue scrubs, had me drape on a cotton gown and surgical shoe covers for a tour of his ICU. He told me that the Joint Commission International — a U.S.-based organization that establishes standards for and inspects health-care providers — was coming for a review in two weeks.

I asked him a litmus-test question about quality of care delivered to critically ill patients: “What is your ICU nurse-to-patient ratio?”

Without hesitating he said, “One to one.” The same as ours in the United States, I told him. He sent me an e-mail in February: “We got JCI with flying colors.” More than 220 medical sites outside the United States are JCI-certified.

I realized that Shetty was providing “value-based care,” a buzzword in today’s health-care-quality movement. Value is defined as quality divided by cost. Shetty had maintained U.S.-standard quality in his hospital services at a lower cost, thereby delivering better value than American hospitals do. That helps explain why the NCPA predicts a 30 percent annual growth in the medical tourism industry over the next decade.

Though NH Hospitals caters largely to the local population, other Indian hospitals — some with Western names such as Apollo, Escorts and Asia Heart Institute — are aggressively marketing to American patients.

But it is not an easy sell, says Arnold Milstein, a professor of medicine at Stanford University. “There are psychological barriers to traveling overseas for health care … to countries where there is no connection,” he says.

Indeed, even though I was born in India, I get culture shock each time I go back. If I were a Westerner recovering from a major medical procedure in a country with a billion people with different foods, languages and customs, I would not find it easy to have no friends or family members to visit me.

And then there is the travel and dealing with jet lag. Shetty proudly told me that his organization will soon break ground on a $200 million, 200-bed facility that can be expanded to 2,000 beds. The location: the British-ruled Cayman Islands, an hour’s flight from Miami.

All this competition was making me a bit uneasy.

According to Milstein, though, it may not be hands-on physicians like me who should feel threatened. He maintains that fewer than 2 percent of U.S. health-care spending can take place abroad, because so many health conditions — a case of appendicitis, for example — require urgent attention.

What may be more significant is the potential growth of ordinary medical services, such as radiology and laboratory tests. Ten to 30 percent of medical transcription is sent overseas, according to the American Transcription Association, and more than 200 hospitals contract for “nighthawk” radiology reading services in India or Australia, taking advantage of the 12-hour time difference, according to a 2006 New England Journal of Medicine article. Many of these radiologists are U.S.-trained. Clinics from the United Kingdom send blood tests overnight to Mumbai for cheaper processing.

On the seventh floor of one of the NH hospitals, I saw EKGs flowing across computer screens from patients having chest pain in Africa and rural India. At the telemedicine unit, cardiologists triaged and treated patients on whom they never laid a hand.

Unlike software and manufacturing, health care is highly regulated. For good or bad, protectionist policies by state licensing boards, hospital credentialing and government legislation could require providers to be locally based, hence limiting the flow of lab tests and patients overseas.

Regardless, medical tourism has gotten my attention, and it motivates me more than ever to do better in providing high-quality health care at the lowest cost.

Jain is an infectious-disease specialist in Memphis and an adjunct assistant professor at the Rollins School of Public Health at Emory University in Atlanta.

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