DALLAS - A new study reports on U.S. potential healthcare cost reductions achieved through medical tourism, citing a lack of cooperation on part of government and insurers, as main barriers.
The National Center for Policy Analysis, NCPA, which conducted the study, is a nonprofit, nonpartisan research institute advocating private solutions to public policy problems.
The study provides details on the increase in medical travel, travel costs and quality of care, change in the globalization of healthcare and legal and policy barriers that restrict it.
“Wealthy patients from developing countries have long traveled to the U.S. for high quality medical care," said NCPA Senior Fellow Devon Herrick, author of the report. "Now a growing number of less affluent Americans are traveling outside the U.S. for affordable healthcare that rivals care in the U.S. in quality."
The study outlines key strategies to reduce healthcare costs via medical tourism:
• Collaboration between American and foreign hospitals
• Outsourcing procedures
• Health insurance plans that cover medical tourism
• Global competition
Consulting firm, McKinsey & Company estimated that the medical tourism industry would rise to $100 billion by 2012. Though the report acknowledges that not everyone will participate, it cites the study, How Health Insurance Inhibits Trade In Health Care by Aaditya Mattoo and Randeep Rathindran, which notes that “if only 10 percent of the top 50 low-risk treatments were performed abroad, the U.S. healthcare system would save about $1.4 billion annually.”
NPCA finds that although there is plenty of potential for cost savings, laws and policies are still a barrier to making it happen. Some examples cited include the Stark and HIPAA laws, which can hinder patient-physician communication as well as other licensing laws that affect procedures. Also, both private health insurers and public programs like Medicare and Medicaid are hesitant to send members abroad for care.
"Most insurers do not cover foreign providers, and we are unlikely to see a large number of patients going overseas right away," said Herrick. "But if these trends hold, the future of medical tourism will be insurers taking advantage of global competition by adding nearby lower cost foreign facilities to their network." For example, BlueShield of California's Access Baja plan is for people living near the border who want to receive physician care in Mexico.”