Passport to Health

If you can’t get the healthcare you need for the price, timeline or quality you want in Canada, you can head to India, Singapore or Thailand instead. That’s the idea behind medical tourism.

While years ago, medical tourism might have meant inexpensive facelifts and breast augmentations, this has changed. It now encompasses cardiac, orthopaedic and bariatric procedures as well as a host of other alternatives. With more global medical experts, increasing healthcare costs and long wait times for many procedures, medical tourism has become a growing trend.

According to one U.S. estimate, the number of people travelling internationally for medical care is expected to reach six million by 2010. McKinsey & Company and the Confederation of Indian Industry indicate that the global medical tourism industry accounted for US$40 billion in 2004—which is projected to increase to $100 billion by 2012.

Made in the U.S.A.
Jonathan Edelheit, president of the Medical Tourism Association, says people opt for medical travel because of price, quality, access and availability. For example, availability is an issue in the U.S. when a particular treatment is not FDA-approved and the person has to leave his or her country to get it.

While access and availability may be concerns, cost is the real issue—especially for those without health insurance. According to the U.S. Census Bureau, in 2007, there were roughly 45.7 million uninsured Americans.

And the savings from medical tourism can be immense. For example, a hip replacement in the U.S. costs anywhere from $43,000 to $63,000, whereas in India, it’s roughly $9,000. In Thailand or Singapore, it’s $12,000. “The employer is saving up to 90%, and the employee is saving thousands of dollars, so it’s a win-win for everyone,” says Edelheit. In 2006, researchers from the World Bank research group identified 15 common procedures performed by American hospitals. They found that if one out of 10 Americans opted to have a procedure done abroad, the potential savings would be approximately $1.4 billion a year.

The U.S. employer’s role in medical tourism, however, is still up for debate. Few American companies currently offer it as part of their benefits packages.

Hannaford Bros., a supermarket chain in Maine and the northeastern U.S., implemented a medical tourism policy in January 2008. The policy offers knee and hip replacement surgery for employees at the accredited National University Hospital in Singapore. It pays travel expenses for the employee and his or her companion, as well as hotel and recovery and rehabilitation costs.

But this is the exception, not the rule. “Employers are concerned about the potential liability risks,” says Joe Marlowe, senior vice-president with Aon Consulting. “What will be required in the U.S. is for some highly visible employers to publicly announce coverage for medical tourism. That will make it easier for others to follow.”

Margaret Sim, a principal with Mercer, suggests that more employers may consider it in the future. “We all know that healthcare in the U.S. is expensive and may prompt employees to seek less costly treatment elsewhere. This reality may incite employers to consider adding medical tourism coverage. In turn, the employer reduces potential costs and employees have a viable option.”

However, Marlowe says uptake by employees would likely be small. “Even though [the procedures have] a high cost on a per surgery basis, in terms of the total cost impact on the employer, it can be fairly negligible when you consider that only some fraction of those having the procedures would actually be motivated to do medical travel.”

Helen Darling, president of the National Business Group on Health, agrees. She’s found that it’s hard enough to get employees to travel within their own state, let alone beyond the U.S. borders. They want to be with their local doctor. “The idea that people would get on a plane and fly for 18 hours for a terrifying procedure just doesn’t quite ring true to me, other than when you’re desperate and you have no alternative,” she adds.