
Toothache anyone? It's time for a vacation - kirillzubovsky
http://startupgrind.com/2012/04/dental-departures-is-bootstrapped-disruptive-oh-plus-they-made-500k-last-month/
======
rdtsc
Can't wait to see the response and the PR campaign launched by American Dental
Association (or whatever it is called).

"<fade in> <sad marimba music playing> <black and white scene> some guy is on
the floor in fetal position, in some dirty antiquated medical office, he is
alone, holding his jaw with his hand. Camera slowly zooms out, out of the
windows, we see he is in Bangkok. Voice over "thinking of trying dental
tourism? Think again!" < fade out >"

On a related topic. I've been practicing medical tourism for 15 years now. Had
1 surgery, dental work, regular comprehensive full panel tests and saved lots
of money. (I went to Eastern Europe). What can I say. I go and also visit
friends and I have connections there to know which doctors are good. Can't
imagine just going there without knowing the doctors or knowing the country.
Corruption is rampant. Imagine it is the same in Thailand or South America.
Once this takes off, there will be lots of opportunity there to prey on
American "health" tourists. I would have to really trust the whole chain of
connections : company that manages this, people they employ locally, local
doctors, nurses.

~~~
ricardobeat
I can't vouch for anywhere else in South America, but private clinics in
Brazil are pretty much safe, well equiped and pristine (public healthcare is a
whoole different story). We also have leading research in many medical fields,
can't imagine Thailand (no disrespect) being anywhere near.

------
eof
I am currently in Nicaragua. I am from the USA and don't have health
insurance. I had a toothache that was periodically dehabilitating, mostly in
high altitudes.

Having an irrational fear of the dentist and a rational fear of dental bills,
I put it off for longer than I should have, and only last week got my work
done in Managua.

A root canal, 3 cavities, a half a dozen or so xrays and a teeth cleaning was
about $600; and included 3 visits and xanax for 2 of the 3 visits.

The last root canal I had in the USA was in 2002, and cost 1100 with
insurance.

I went to one of the most expensive dentists in Managua because he was
recommended highly and spoke perfect english, and I didn't really trust my
spanish.

Really interesting to wrap this phenomenon in a profitable venture; but I
found it easy to get the information myself.

I would 100% absolutely do it again.

~~~
dmix
Interesting. How much was the flight + living expenses by comparison?

~~~
eof
I have been traveling around for a while so I can't comment on flight as I
came via bus from Costa Rica.

Living expenses are extremely cheap. A nice apt on a short term lease in a
nice part of Managua is 300-400 a month. A very nice restaurant is like 7
dollars a person; food on the street is <$2 a meal.

For comparison, day labor outside of Managua costs 150 cordoba a day; or about
7 dollars.

------
harshaw
My Wife is a Dentist with a specialty in prosthodontics. One of the more
complicated cases you can do in Dentistry is a full mouth reconstruction where
you basically are fixing all the teeth and likely fixing the bite. These
treatment plans can easily cost $30K or greater. Sure, you can go overseas and
get this kind of treatment. However, if they are doing implants the only way
to do it in a timely basis is immediate placement (stick the implant in the
bone and put a crown on) instead of installing the implant and waiting for the
bone to heal. Additionally, good luck in getting a stateside dentist to
support foreign dental work. The statement that dentistry has been around
since Roman times is laughable; certainly not modern dentistry and definitely
not implant dentistry.

Here's a brief overview of the economics:

230K student loans, 6K / month business loan for office, 2K / month rent
(fairly cheap IMO), salaries for staff, malpractice, lab fees, etc. So there
is clearly a lot of shit to pay for. We aren't driving a Bentley yet.

One of the big issues driving cost is the same thing as medical costs: fee for
service payment. The nature of the beast forces Dentist to optimize specific
procedures or more of the expensive procedures. Additonally, armies of
consultants out there train dentists (and their staff) to optimize "coding"
against Dental insurance rules to optimize the payouts from the insurance
companies.

~~~
Retric
There are basically 4 things driving up medical costs in this country.
(Education, Malpractice, R&D, and Insurance) Unfortunately, I don't see any
fundamental change happening in any of those areas any time soon. Just think
what it would mean if you banned say, advertising the name of any prescription
drug to private citizens.

I mean I can understand advertising that there are prescription treatments for
ED which hey people might not know about. But, when these things have
significant side effects and can't be sold over the counter you need actual
medical advice not just people dancing around with smiles on their faces. Not
that I think there is a chance in hell of this actually changing, but many
country's actually do something like this.

~~~
dalke
Malpractice insurance is something like 2% of the overall medical costs in the
US, and at least some states have caps on liability lawsuits. Looking now, it
seems malpractice insurance premiums have stayed pretty constant over the last
couple of years.

Are you sure that malpractice is one of the major factors "driving up medical
costs in this country", and if so, do you have a pointer to something which
reinforces that statement?

Personally I thought the big increases in liability insurance coverage 5 or so
years ago were because the insurance companies were so invested in the market,
that after the market crash they needed to hike rates to build back their
reserves. Those hikes were then used as justification in advocating liability
caps.

~~~
Retric
It's not a major direct cost, however due to inefficiencies in the system your
paying for that 2% in several additional ways. Doctors do a lot of tests to
cover their ass. People without insurance tack their get their costs shifted
to other people. Then Insurance company's tack on their profit margin above
that 2% that's already been compounded a few times. And many of those
unnecessary tests can cause further complications down the road due to things
like false positives.

~~~
dalke
I believe that 2% includes defensive medicine. Ahh, here's one of the relevant
papers: <http://content.healthaffairs.org/content/29/9/1569.abstract>

"Overall annual medical liability system costs, including defensive medicine,
are estimated to be $55.6 billion in 2008 dollars, or 2.4 percent of total
health care spending."

I really don't see 2.4% as one of the major things "driving up medical costs
in this country."

Here's another from [http://www.factcheck.org/2009/10/malpractice-savings-
reconsi...](http://www.factcheck.org/2009/10/malpractice-savings-
reconsidered/) "In an Oct. 9 letter to Republican Sen. Orrin Hatch of Utah,
CBO Director Douglas Elmendorf said that a package of changes including limits
on malpractice awards 'would reduce total national health care spending by
about 0.5 percent (about $11 billion in 2009).'" "That figure includes a 0.2
percent reduction just from lower premiums for malpractice insurance paid by
medical professionals. And it includes an additional 0.3 percent in reduced
costs of medical tests, imaging and other medical services. "

This would imply that the malpractice overhead isn't more than a couple
percent.

Personally, I think the major perception regarding malpractice is based on
propaganda by people who want to put caps on all lawsuits. See, of all things,
a Cracked article on the major examples of 'outrageous' judgements where the
actual facts are at odds with the perceptions:
[http://www.cracked.com/article_19150_6-famous-frivolous-
laws...](http://www.cracked.com/article_19150_6-famous-frivolous-lawsuit-
stories-that-are-total-b.s..html) .

Civil lawsuits are one of the few ways that individuals can take on large
companies with bad business practices. Caps mean those companies are more free
to make decisions in favor of cost-cutting over quality.

Of course it's hard to justify it that way. It's much easier to say "idiotic
medical lawsuits are one of the major reasons for increases in medical costs,
so lets cap all lawsuits."

Where do you get your idea that medical malpractice costs are a major
contributor to increasing medical costs, either direct or indirect?

~~~
Retric
_Where do you get your idea that medical malpractice costs are a major
contributor to increasing medical costs, either direct or indirect?_ edit: I
am not predicting future costs just describing things as they are right now.

I know a few doctors paying well over 100k / year in personal malpractice
insurance. Though it looks vary regional. <http://www.ama-
assn.org/amednews/2003/11/10/prl11110.htm>

Obstetrician-gynecologists Florida (Dade County) $201,376 (2002)
$249,196(2003) South Dakota $13,325(2002) $14,662(2003)

I agree that on it's own it's not the single top issue. But, don't forget
those cost estimates 2.4% get multiplied by all the other inefficiency's in
the system. I don't think putting cap's on all lawsuits is the best idea, but
neither are lawsuits an efficient processes. Still, if you eliminate 5
different 2 percent inefficiency's your talking about a 10% drop in healthcare
spending and around 220 billion dollars a year.

There is no single bullet solution to healthcare. And a lot of people make
their living directly from those inefficiency's, but you can't provide
everyone the 'perfect' care that everyone seems to expect. Nor does 'perfect'
care mean everyone get's to live forever.

~~~
dalke
Yes, I saw that article as well. It is now 9 years old, and out of date.
Quoting from <http://www.medscape.com/viewarticle/751009> : "Premiums indeed
rose dramatically in the early part of the new century, but in 2011, they
declined for the fourth straight year for 3 representative medical
specialties, according to a publication called Medical Liability Monitor
(MLM). Its annual rate survey, highly regarded in the field, was published
this week."

You first said the 2% doesn't include the impact of defensive medicine. I
pointed out that it did include defensive medicine, so now you say it's
magnified by other inefficiencies in the system. I don't believe you, because
your arguments sound very hand-wavy, and don't change in the presence of
contrary data. Do you have any evidence to strengthen your statement?

I could be even more hand-wavy and argue that the increase number of medical
malpractice payouts is due to the medical system in the US getting worse. As
<http://content.healthaffairs.org/content/29/9/1565.full> points out, "One way
to attack the medical liability crisis is to make health care better and safer
in the first place" and "Another key to limiting medical malpractice suits is
to improve communication with patients immediately after an injury" and "Most
health policy experts, he says, believe that “caps on damages [are] tangential
to the real problems with the malpractice system, which involve excessive
numbers of medical errors, inaccessible compensation for most avoidable
injuries, and a slow, expensive process of dispute resolution that is inhumane
to both plaintiffs and defendants”."

You pointed out that you know doctors paying over $100K/year in personal
malpractice insurance. According to
<http://content.healthaffairs.org/content/29/9/1585.abstract> "We found high
levels of malpractice concern among both generalists and specialists in states
where objective measures of malpractice risk were low. We also found
relatively modest differences in physicians’ concerns across states with and
without common tort reforms. These results suggest that many policies aimed at
controlling malpractice costs may have a limited effect on physicians’
malpractice concerns." or as stated in
<http://content.healthaffairs.org/content/29/9/1565.full> "Emily Carrier and
colleagues find that physicians’ perceptions of the threat of being sued are
out of step with their actual risk of being the target of a malpractice
lawsuit."

In other words, those doctors might not be needing the $100K+ coverage which
they are paying for.

According to [http://www.kaiseredu.org/Issue-Modules/US-Health-Care-
Costs/...](http://www.kaiseredu.org/Issue-Modules/US-Health-Care-
Costs/Background-Brief.aspx) , "health care costs for chronic disease
treatment account for over 75% of national health expenditures" and "At least
7% of health care expenditures are estimated to go toward for the
administrative costs of government health care programs and the net cost of
private insurance."

Those two factors - which you didn't mention in your list of four things
affecting the increase in medical rates - are both larger than the 2.4% we're
talking about related to malpractice.

~~~
Retric
2.4% is 20% larger than 2%. That .4% represents something like 8 billion a
year which is ya know a lot of money. I have also seen numbers close to 3%
from a few sources.

If you want a less hand wavy answer why 2.4 was still to low insurance is
inefficient. Here is a link to one company lowering it's rates after the
recent change in how inefficient they can be:
[http://www.ctmirror.org/story/12550/aetna-seeks-cut-
health-i...](http://www.ctmirror.org/story/12550/aetna-seeks-cut-health-
insurance-rates) _Beginning this year, the federal health reform law requires
insurance companies to spend at least 80 percent of the money they collect in
premiums on health care costs for individual and small-group plans, and 85
percent for large-group plans._ Several company's where over that limit.
Anyway, going from the direct cost of 2.4% though an 80% efficient insurance
company means .024 / .8 = 3% of someones insurance premiums go to paying that
2.4% direct cost. It's a little worse than that because insurance also
requires the provider to create the bill and that time is then indirectly
billed back to the insurance company's.

But, still all of this is really nitpickey. It's not really sometime I care
about, I just used the word as one of several inefficient part's of the system
we have now. I am fine suggesting the dead weight is somewhere between .5% and
3.5% of total healthcare spending, but that's still something like 100,000 _or
more_ million dollars every 10 years.

~~~
dalke
Oh come on, I first said "something like 2%" and after a short bit of research
found the number was 2.4%. Not bad for a several year old memory, I think.

Neither you nor I have read that paper which gives the 2.4% value. It may have
included the insurance overhead already.

In any case, the health reform law you linked to covers medical insurance for
patients, while the 2.4% we're talking about is malpractice insurance for
doctors. You can't apply the numbers from one system directly to the other.

The US is the third most populous country. Of course any numbers related to
health care are going to be huge. We spend 2.6 trillion or so on health care
in a year. You can do as you did and use 100 trillion over 10 years, or you
can say that $10 billion per year / population of the US, is $32 per year, or
under 0.10 cents per day per person. Note that 2.6 trillion / population of
the US => $8,387 per person per year, and 2.4% of that is $201 per person per
year or $23 and $0.55 per person per day, respectively.

Quoting again from Wikipedia: "In December 2011, the outgoing Administrator of
the Centers for Medicare & Medicaid Services, Dr. Donald Berwick, asserted
that 20% to 30% of health care spending is waste. He listed five causes for
the waste: (1) overtreatment of patients, (2) the failure to coordinate care,
(3) the administrative complexity of the health care system, (4) burdensome
rules and (5) fraud."

I do not know if (1) is due to defensive medicine or other reasons. For
example, when I broke my toe, I asked for extra x-rays even though it wasn't
needed. I know friends who got MRIs even though not essential, because it was
included in their insurance plans. Or since the doctor gets reimbursed per
test, there's a financial incentive to do more tests (so long as cost less
than the reimbursement).

Searching now, I found no useful numbers about the overall cost of defensive
medicine. Indeed, it seems to be pretty hard to resolve. I came across the
statement that "variation in intensity of treatment from one hospital or city
to the next has been well documented among the government's veterans
hospitals, where there is no financial or business drive for more rather than
less treatment", so it's going to be noisy data.

Doctors do commit malpractice. There has to be some system in place to handle
that. Our system now is through the courts. Just how bad are 'frivolous'
medical lawsuits?

Let's take
[http://en.wikipedia.org/wiki/Medical_malpractice#The_case_fo...](http://en.wikipedia.org/wiki/Medical_malpractice#The_case_for_medical_liability_reform)
as the source for numbers. This should be biased for the doctors. The AMA says
60% are dropped without payment and do not go to trial, costing $22,000 in
fees. ... Sneaky AMA! Notice that it does _not_ list the percentage of
payments made without going to trial. This makes that section unusable for
what I was going to do.

I had to go to <http://bjs.ojp.usdoj.gov/content/pub/pdf/mmicss04.pdf> and
find that in the states where payout and lack of payout is required to be
reported (ie, Missouri and Maine), some 1/3rd of claims get a payout. Median
payout (using Missouri's numbers since they have 8x more reported cases than
Maine) is $110,000 for 2,598 cases out of 8,379 total cases. Of these, under
5% are reached by a trial decision.

So, 65% get no payout, and each costs the doctor (using the AMA numbers)
$22,000 in legal fees. 30% gets a payout of $110,000 and costs the doctor
$22,000 in legal fees, and 5% are reached by trial, of which 90% is found to
have no payment (at $110,00) to defend and 10% is found to have a payment of
$342,000 and still needs $110,000 to defend. Further, there are about 17,000
cases per year in the US.

Costs because the doctor was actually negligent: (0.30 * (110+22) + 0.05 * 0.1
* (342+110)) * 17000 = $700 million.

Costs because the doctor was incorrectly accused as being negligent: (0.6 *
110 + 0.05 * 0.9 * 110) * 17000 = $1200 million.

Hence, even if you could magically make all frivolous cases disappear, you
could only reduce the payouts+legal expenses by 60%, and you almost certainly
wouldn't make defensive medicine practices disappear because there will still
be court cases, and some rare ones in the $1,000,000+ range.

This is something I'm nitpickey about because I see liability lawsuits as
being the only strong tool individuals have against negligent practices. I
don't want to see legislative attempts to curtail that power when the
underlying justifications are unfounded. From what I can tell, the cost for
overtreatment and liability, while large in aggregate numbers, is simply not
one of the major reasons for increasing health care costs in the US.
Especially since liability rates haven't gone up the last three years.

~~~
Retric
_This is something I'm nitpickey about because I see liability lawsuits as
being the only strong tool individuals have against negligent practices._

Ok, I get where your coming from.

The problem I have is lawsuits is they are expensive AND ineffective. So many
things have to happen before _cutting off the wrong leg_ actually get's back
to those responsible that losing a 2 million dollar gross negligence lawsuit
is less meaningful for a doctor than winning the lawsuit and losing their
licence. There are some really bad doctors out there, but because there are
still insurable because it's fairly random when someone get's sued so it takes
a long list of errors before they need to look for other employment. Moving
can also help cover someones medical misdeeds.

The simplest way to cut down on medical errors is to limit how long someone
can be on call. Life or death decisions at the end of a 12 or sometimes 16
hour day is just insanity. Yet, it's all to common for someone to end up
pulling an 18 hour shift.

As to the awards, you can't just take payouts and say this money ends up in
the hands of those who where miss treated. Court cases are expensive and it's
not uncommon for someone to receive well below 1/2 the stated award after
their legal team get's it's cut. It also tends to take a long time.

My suggesting would be a system with automatic and harsher penalty's where
people and institutions are penalized for their average mistakes over time not
just the occasional one off case they can buy insurance to cover. And where
people who have been mistreated can automatically receive reasonable
compensation without the protracted legal battle. Unfortunately, I have no
idea of how to implement such a system.

PS: Then again, I am not really a doctor either. Just some random nerd who has
really enjoyed this disunion on a late Sunday afternoon. I will even say you
win the point if it makes you feel any better.

~~~
dalke
Woo-hoo - I win on the internets! ;)

Yes, that gets back to an issue I highlighted earlier, which is the need to
reduce malpractice in the first place. There's a lot of ways to do it. I agree
that unfortunately, we've decided that the courts are the right place for
feedback.

Doctor review boards, for example, are woefully hesitant to chide doctors who
continue to have bad practices. Politicians are equally hesitant to put the
nose of "big government" into oversight.

Frankly, one of the reasons I'm in favor of nationalized general health care
is that it tightens the feedback between the people who pay for health care
and the people who do oversight.

Thanks for the opportunity to do the research on the topic and improve my own
understanding.

------
amalag
An amazing idea to disrupt this industry. I can see the same thing for medical
and vision. Lasik for 25% of the cost sounds nice (but messing with your eyes
is a big risk). What are other players in this market?

~~~
read_wharf
Medical tourism, from the States to elsewhere, has been a "thing" for some
time, maybe a decade(?). I'm sure it's been done individually by out of the
box thinkers well before that.

It's great that businesses like in the article are making this a bit more
accessible and known, it will put some cost pressure on Stateside providers.
Also help people save some money by going outside the States, or even get care
that just would not happen otherwise.

------
petercooper
A guy who used to come to our local tech group used to get dentists from
Hungary to come to the UK and set up in inflatable dental surgeries at
temporary locations and offer cheap dental care. So that's bringing cheap
dentists to us, rather than us heading to the cheap dentists. No idea how it
panned out though, as he isn't doing it anymore..

[http://www.dailymail.co.uk/health/article-1051660/Deflated-c...](http://www.dailymail.co.uk/health/article-1051660/Deflated-
charges-blow-dental-surgery-Travelling-Hungarians-offer-half-price-treatment-
UK.html)

------
ChristianMarks
I just spent $21,600 on three implants and four crowns. And that was with
insurance.

------
_delirium
Here's an article from 2003 on (the old) Kuro5hin on the same subject,
involving dental tourism to Mexico:
<http://www.kuro5hin.org/story/2003/12/20/121018/65>

~~~
Daniel_Newby
I miss the Kuro5hin of yore. It has gone so far downhill as to be unreadable.

------
mrmekon
My parents have been traveling to Costa Rica for their dental work for years
(from the US). My dad usually stays with a local family through a language-
exchange program, stays for two weeks, and takes Spanish classes at their
local university.

He says he's saved tens of thousands of dollars (he doesn't have dental
insurance here), and gets awesome, educational vacations out of the deal.

Even my mother, who is not adventurous at all, loves it. The dentists speak
perfect English and have top-tier practices.

~~~
paul_mctaggart
Great to hear that your parents had an excellent experience in Costa Rica!

I really think once people step inside a Costa Rican/Thailand, Mexico dental
clinic their concerns of quality fade away.

Full disclosure: I work @ Dental Departures

------
viraptor
I completely agree with this. I'm doing a... reverse tourism (?) every year by
leaving the UK to visit my family in Europe and get my dental issues fixed
there. Saves me a lot of money considering cheap flight tickets are around £50
both ways and a standard filling with local anaesthesia costs the same (in a
good quality place)...

With local prices of ~£7 per month for basic dental insurance, this is a very
simple choice.

------
s0me0ne
Is there a site like this for healthcare? I remember seeing something on the
news once where people were going to India to get surgery done. When the US
treats healthcare like profitable business, what else do expect to happen?
Consumers w health issues will go elsewhere if possible, although with
emergencies, you are pretty much stuck here.

------
kandalf
My grandparents have been to Argentina a couple times in the last few years to
get their dental work done. They have been extremely happy with the quality
service as well as the pricing. Commercializing this is a great idea.

------
showerst
I'm a bit confused by the numbers here. They had 400 appointments and made
$500,000 in revenue? Does that mean that they're charging over a thousand
bucks to set these things up?

~~~
4clicknet
My first start-up was a medical tourism company.

It's basically an affiliate business model: you get 5-10% of the cost from the
doctor, hotel, and airline (depending on your negotiation skills). $500K
revenue means $25-50K in true gross revenue for the company. Their net profit
is $3-5K on that revenue, depending on how efficient they are.

I put my business on the back burner for 2 reasons:

1) 5-10% of the cost of the package is your true revenue before overheads, so
the it's not very profitable once you consider your expenses. 2) It's a high
touch customer service experience, so you can't scale it profitably (people
will not buy an operation via e-commerce like they would an e-book: there's a
lot of personalized contact and questions, examination of records, etc.).

