Medical tourism: What questions should health plans and employers be asking?

by David E. Williams
Health business blog



Until now, medical tourism has mainly been a self-pay phenomenon. But over time the patient base has expanded from the plastic surgery crowd to the uninsured and underinsured. Now health plans and employers have started to ask what role medical tourism can play for them. We’ve been receiving a number of inquiries on the topic at my consulting firm, MedPharma Partners. Soon we’ll be developing a medical tourism white paper. In the meantime, here are some questions health plans and employers should be asking:

1. Should I include overseas providers in my network at all? If so, which ones?
For some payers the time is now. For others waiting will make more sense
The providers that are popular with self-pay patients may or may not be the right ones. Proximity, local infrastructure, quality and capacity may be more important considerations

2. How should I engage my employees or members? Should I require patients to travel or should I make it optional?
The moment health plans and employers start to encourage the use of overseas providers they will be met with suspicion, but there are ways around this. Making overseas care optional will reduce the suspicion but limit the savings
It’s important to let prospective traveling patients engage with their peers. That’s one objective of the forums at MedTripInfo
It can also make sense to share some of the financial benefits with employees and members or simply to grant them additional vacation time, which they can enjoy overseas

3. How do I guarantee quality and overcome the challenges of patient safety?
You might want to ask this of your local providers, too! But seriously, there are international accreditation bodies like JCI and many overseas hospitals are going over and above those requirements

4. What about medical malpractice and liability?
That’s a tough one to address and we’ll see what evolves. There are promising approaches emerging involving arbitration and insurance for complications
This may be a hard argument to make, but patients don’t have great recourse in the US when things go wrong. Cases take several years to reach trial and plaintiffs usually lose, unlike in other personal injury cases

5. How will pre- and post-travel care be coordinated?
This issue can be addressed differently depending on the procedure and patient population
It’s essential to work with your existing provider network rather than handling medical tourism in a vacuum

6. Should I contract with providers directly or work through an aggregator?
It will be difficult to develop and maintain a comprehensive network on your own so working with one of the emerging provider networks is a better idea

7. What procedures and treatments should be included?
This will depend on your patient population but it will generally include orthopedic and cardiac surgery

8. How much am I likely to save and how can I increase that number?
Most of the estimates tossed around, touting “90% savings” and so on are based on a comparison of US charges with the price paid overseas. First of all, only the uninsured get stuck paying charges, plus you’ll need to factor in the costs of travel –maybe also for a companion. I haven’t seen a really good estimate of the true savings potential for an insured population

9. How will domestic providers react?
Depends on how they’re managed, and this is one place where the interests of health plans and employers may diverge. Health plans may want to use the threat of sending patients abroad in order to beat down providers on price. Employers are more interested in maintaining relationships

10. What is the relationship between medical tourism and consumer directed health plans?
In theory patients with consumer directed plans are a great fit for medical tourism. In practice, they may blow through their HSA even at steeply discounted international prices, so it may not make that much of a difference

11. How well does medical tourism fit with limited benefit/”mini-med” plans?
Potentially very well. It offers the potential to include a major medical component at an affordable price

If you’d like to discuss these topics or receive a copy of the white paper when it’s published, send me an email: dwilliams@mppllc.com



Health Business Blog is a regular contributor to BioHealth Investor
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