
For Medical Tourists, Simple Math - scottkduncan
http://www.nytimes.com/2013/08/04/health/for-medical-tourists-simple-math.html
======
YokoZar
" _In addition, device makers typically require doctors’ groups and hospitals
to sign nondisclosure agreements about prices, which means institutions do not
know what their competitors are paying. This secrecy erodes bargaining power
and has allowed a small industry of profit-taking middlemen to flourish: joint
implant purchasing consultants, implant billing companies, joint brokers.
There are as many as 13 layers of vendors between the physician and the
patient for a hip replacement, according to Kate Willhite, a former executive
director of the Manitowoc Surgery Center in Wisconsin._ "

A simple legal remedy here would be to invalidate this sort of NDA agreement.
The government is already involved as a customer in the health care market,
and having the courts simply no longer recognize contracts that prohibit
disclosure of prices would bring some immediate transparency to many involved.

The law could also go a step further and actually set up/order public listings
of prices (this is already done in a lot of industries where vendors try to
avoid competing on price).

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IANAICANABANA
I was a medical tourist in the opposite direction earlier this year. I'm from
Canada, land of free health care, and my doctor told me that I would have to
wait 6 months to see a specialist.

My ailment[1] prevented me from sleeping most nights, caused severe,
productivity-ending headaches all day, and caused me to pop ibuprofens like
candy. My PCP attempted to use water to eliminate what he believed was an
earwax impaction 14 times on separate days. It had been almost 2 months of me
completely disabled before he was willing to put in a referral to the ENT.
When he did, they told me it would be six months. You can imagine my
frustration.

So, I had a friend drive me to a clinic in Washington state. A bit of
discussion, $900 and two visits later, I had seen an otolaryngologist, he had
used a small curette to clean out the ear canal, and I was better. $900 to not
cry myself to sleep all day for six months seemed like a pretty good deal to
me.

Six months later I got a phone call from an office of an ENT here in Canada. I
was unbelievably angry.

[1] I had a condition where the skin had grown over the eardrum in your ear.
It required surgery by an otolaryngologist to remove the problem and restore
my hearing.

~~~
joe_the_user
I read a while back that the US hospitals charge foreign medical tourists
competitive rates. But getting that rate as an American is another matter
since the hospitals make so much with their standard rates.

~~~
JVIDEL
Nope, I been to the doctor while in the US and the bill was insane given it
was a routine check.

Good thing I had travel insurance.

~~~
joe_the_user
I mean the price charged to people from other countries who shop different
hospitals for particular medical procedures - "medical tourists".

Ordinary tourists who come for other reasons and happen to seek medical care
are a completely different story - they'll be charged the "highest possible
fee, 'cause we can" rate.

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cpursley
Who's interesting in doing a healthcare tourism startup? Especially if you
know the medical system well. Serious. Hit me up.

My wife has gone to Russia twice for dental work (her home country). Was a
fraction of the quotes here, including airfare.

~~~
gojomo
It's a good idea... and also already a big thing. Look at all the AdWords for
[dental vacation] and similar searches. Amish groups taking train rides to
Mexico for dental work paid in cash is also apparently a thing.

It could be much bigger, across more procedures... but often people needing
care are, by virtue of both age and their current medical worries (and past
experiences with bad providers), less adventurous.

A big breakthrough would be if Congress, as a cost-saving measure, allowed
Medicare payments for out-of-country treatment.

~~~
falk
"A big breakthrough would be if Congress, as a cost-saving measure, allowed
Medicare payments for out-of-country treatment."

If Congress cared about saving money when it comes to Medicare they wouldn't
have passed Medicare Part D, which by design doesn't allow for the negotiation
of lower drug prices with pharmaceutical companies like the Department of
Vererans Affairs is allowed to do. The fact of the matter is that a lot of
palms are getting greased in Washington when it comes to healthcare. Thus why
Obamacare doesn't have a public option.

[http://en.wikipedia.org/wiki/Medicare_Part_D](http://en.wikipedia.org/wiki/Medicare_Part_D)

~~~
tryitnow
Precisely. I worked a little bit for a large pharma company (in a finance
capacity) and I saw first hand how incredibly profitable it is for the US
government to not have negotiating power on drug prices.

Pharma companies make a wildly disproportionate share of their global profits
in the US simply because they don't have to negotiate with a large 'super-
buyer" (e.g. medicare).

Now if pharma R&D were productive I wouldn't have a problem with this, but
it's notoriously unproductive (and not just because of the admittedly overly
burdensome FDA regulations).

I would support a grand compromise: 1) for pharma companies: reduce FDA
hurdles for drug approval, but add more aggressive post-approval tracking (to
reduce the risks associated with a lower regulatory hurdle) 2) for the rest of
us: allow medicare to negotiate aggressively on price, this will have a ripple
effect and lead to lower drug prices for all.

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EGreg
It would be interesting to see a breakdown of what really accounts for the
majority of the price differences. This article mentions some things in
passing but ultimately doesn't conclude with the main quantitative insights.

~~~
VonGuard
Most of the difference here is that our hospitals have to fob off the money
they lose from treating patients without health care onto those that do. They
charge a lot more because every 5th or 6th person coming into the emergency
room has no health care, must be given treatment, and will never be able to
pay for it. Thus, we all take on that burden through a backdoor, round the
corner, through the mailslot, rather than just by dealing with it and giving
everyone health care....

~~~
EGreg
That doesn't really explain how the healthcare can cost 5x or more. What
you've said is that every 5th or 6th person is a free rider (presumably due to
laws such as the COBRA
[http://en.wikipedia.org/wiki/Consolidated_Omnibus_Budget_Rec...](http://en.wikipedia.org/wiki/Consolidated_Omnibus_Budget_Reconciliation_Act_of_1985))
... if that was the source of the added costs, it would suggest they would
only be 1.2 or 1.5x higher, not 5x or more.

~~~
Nrsolis
The #1 reason healthcare costs more is because of over-treatment. When
providers are paid by the procedure, suddenly everyone needs a procedure (or
ten). Combine that with third-party responsibility (insurance pays doctor,
employer pays for insurance), opaque pricing structure (doctors are the only
ones that can tell you if a procedure is necessary or not), and you have a
"market" that is "broken".

Put simply, everyone wants "the best care" when they never have to actually
pay for it. And as long as providers are incentivized to provide "the best
care", they will do it, as lost as "best" equals "expensive".

~~~
mjn
Over-treatment doesn't explain why the _same_ treatments cost more, though.
The base charge for simply occupying a hospital bed for one day is absurdly
high in the U.S. compared to just about any other country (Canada comes close,
if you're a non-Canadian and therefore actually liable for it).

~~~
Nrsolis
Actually, it does explain it. Lots of people are admitted that don't need to
be and nobody ever questions it.

And since we have such a high proportion of non-insured here, those admissions
raise the cost for everyone else who DOES have insurance.

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huherto
Some cities in Mexico have a very good medical system for the local rich elite
that is very affordable for Americans. This is from my hometown...
[http://www.chihuahuamedicalcity.com/English/hospitales.html](http://www.chihuahuamedicalcity.com/English/hospitales.html)

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abalone
The magic of the market.

~~~
johnchristopher
FTA: > Dr. Cram, the Iowa health cost expert, points out that joint
manufacturers are businesses, operating within the constraints of varying laws
and markets.

> “Imagine you’re the C.E.O. of Zimmer,” he said. “Why charge $1,000 for the
> implant in the U.S. when you can charge $14,000? How would you answer to
> your shareholders?” Expecting device makers “to do otherwise is like asking,
> ‘Couldn’t Apple just charge $50 for an iPhone?’ because that’s what it costs
> to make them.”

> But do Americans want medical devices priced like smartphones? “That,” Dr.
> Cram said, “is a different question.”

Indeed.

Maybe mixing something that is designed to work better when no ethics is
involved (free market and capitalist ideology) with a highly relative to
ethics sector (healthCARE) isn't such a good idea. Well, not for shareholders
of course.

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EwanG
So I get that by cutting out the insurer you are saving some funds, but where
does the rest of the difference come from? Are the hospital rooms and surgeons
so much cheaper because everyone in those countries pay them rather than just
the few people who actually use their services?

~~~
markvdb
Some possible reasons:

* The hospital system in Belgium is 99% either state or non-profit owned. Less sticky fingers. Less luxury.

* Infrastructure (buildings, tools, ...). The infrastructure is extremely heavily state subsidised.

* Medical professional wage negotiations. Medical professionals earn quite a bit less in Belgium than in the US. Quite many (most?) medical pros actually seem to have their priorities right: helping people solve medical problems.

* Choice. In Belgium, people, not insurers choose the hospital they go to, based on reputation and perceived quality.

* Volume. Healthcare in Belgium is fairly accessible, probably one of the most accessible in the world. This means few people putting off operations for financial reasons, so higher volume.

* State subsidies spilling over to foreign patients in unintended ways. I could very well imagine some of the marginal cost of an operation on a non-resident American citizen also being carried by the state in other ways.

Two anecdotes, logical consequences of this system.

1) My (poor by US standards) 90 years old neighbour had a hip replacement at
the age of 86, 100% paid by the state.

2) An aunt working as a nurse told me about a phenomenon that was quite common
until a few years ago: "winter rabbits", old people "dumped" into hospital for
several weeks even if they were not ill. Relatives dumped them at the hospital
as a (to them) low cost way of getting rid of them for a few weeks while on
holiday for example.

~~~
berntb
I've lived in Scandinavia, with largely similar systems (they vary a bit, I've
seen Sweden and a bit of Finland). The health care systems are centrally
planned and administered, and hence have the typical problems doing the work
in an efficient manner.

For instance, it is acknowledged in international comparisons as really hard
to get diagnosed because doctors just don't have the time, largely because of
administration. Me and others I know have had years and decades of lowered
life quality from easily cured problems like bacteria infections, simple knee
problems, allergies and iron/vitamin deficiencies.

I've heard good things about the German health care system.

Notes: I have also lived a few years outside of the Nordic countries, so I
have some perspective. And I agree that the US system seems the craziest one
on the Western world.

Edit: The government has recently decided that all illegal immigrants in
Sweden will get free health care, without any paperwork. If you need an
expensive and can fake an Ukrainian accent in English, or something similar,
there is a cheap solution for millions of Americans with a ticket to Sweden...

~~~
moocowduckquack
"The government has recently decided that all illegal immigrants in Sweden
will get free health care, without any paperwork."

If the vast majority of people treated are not subject to itemised accounting,
the bureaucratic expense of having itemised accounting for one small group can
actually be higher than just treating them for free as well.

~~~
berntb
Not for expensive operations costing 10K++ €. The administration of those
payments is already set up for e.g. tourists that get sick.

Since it seems I need to explain in more details:

The problem is that potentially anyone which can get to Sweden can get
expensive treatment free. This is potentially ruinous for a small country.
Just the millions of poor gypsies in Romania/Bulgaria which lack good health
care for poor people ("I'm from the republic of Moldova outside the EU. I am
here illegally because criminals are after me") is enough to break the Swedish
health care system if they use this loophole in an organized way. Or normal
citizens in those countries, for that matter. We will see...

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jotm
Jesus Christ, the price is 5 times lower for a non-EU citizen in Belgium
(which is still pretty expensive by worldwide or even European standards)?
That's just unbelievable...

------
Ras_
Cross-European medical tourism could explode next year, after 2011/24/EU:
Directive on patients' rights in cross-border healthcare enters into
application.

The directive created a legal framework for patient’s right to seek healthcare
in another member state and for reimbursement.

[http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2...](http://eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2011:088:0045:0065:EN:PDF)

------
bdcravens
Eventually I'll need a lung transplant, and possibly more (I have Cystic
Fibrosis). It's one thing to talk teeth and knee joints, but lungs and livers
are a completely different story. That said, paying $150K+ isn't something I'm
looking forward to (or even know that I'll be able to do), so medical tourism
is something I follow closely to see how it develops.

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Qantourisc
The state should also do some math. What is the cost of having a disabled
person, even if slightly ?

------
rayj
So what are the negatives? This NYT article reads like a PR piece for medical
tourism... What about malpractice insurance in Belgium/Poland and what happens
if there are problems down the road with TFA's hip implant?

~~~
auctiontheory
What happens if there are problems down the road with an implant (or any other
procedure) you got in the US? You pay for more procedures, that's what.

The ability to sue for millions of dollars is the one "advantage" of buying
your medical care (or airplane tickets) in the US. We each need to decide how
important that is to us.

~~~
octatone2
> The ability to sue for millions of dollars is the one "advantage"

That isn't necessarily true, as some states have caps on tort damages, and
more corperations are lobying for similar caps/limits on civil restitution via
state law: [http://www.nytimes.com/2013/01/25/us/even-with-counsel-
texas...](http://www.nytimes.com/2013/01/25/us/even-with-counsel-texas-
amputee-is-hindered-by-state-tort-laws.html)

