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Toothache anyone? It's time for a vacation (startupgrind.com)
43 points by kirillzubovsky on Apr 7, 2012 | hide | past | web | favorite | 35 comments

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.

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.

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.

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

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.

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.

Harshaw: we actually see roughly 30% of our patient base receive dental implants. The vast majority (95%) of our patients do not receive immediate load dental implants. They receive their implant and then travel back for treatment 4-6 months later (after the bone has fused to the implant). The great part is they still save money even with the second visit and this includes the cost of their travel.

I appreciate your costs to become a dentist...I've felt the burden of student loans and it is tough to dig yourself out.

Dental Departures is globalization plain and simple: dentistry & medical services are no longer immune. The labor, overhead & cost of materials are less expensive overseas than in the United States (for the same quality of care).

Full disclosure: I work @ Dental Departures

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.

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.

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.

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... "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... .

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?

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.

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/... , "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.

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... 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.

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... 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.

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.

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.

Your neighbour to the north does this. It leads to vague advertising that tells you about some problem and encourages you to ask your doctor about it. Doesn't seem to have been the end of the world.

FYI, there are Mayan human skull remains that have shell, bone, and wood implanted into the jawbone. Not really the point though; are you suggesting that a US dentist would disregard their Hippocratic Oath and refuse to treat a patient who has been treated abroad in the past?

My point was more that the Dentist will treat the patient according to their standard of care. That could mean for example that they won't patch the current crappy work and instead treatment plan a correct solution. Keep in mind that I am a lowly hacker who has some insight into Dentistry via pillow talk :)

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?

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.

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..


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

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

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

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.

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

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.

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.

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.

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?

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.).

$500K is the bookings of Dental Departures...our revenues are 15% of this total

Full disclosure: I work @ Dental Departures

Not certain, but it seems they charge you the full amount for the procedure and then pass the money down, with an exception of a small fee. That's why with 500K in revenue, their profit #s are lower.

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