Will Obama end the American medical tourism dream?

As reported in International Medical Travel Journal this week, President Obama has pledged to cure Americans from "the crushing cost of health costs." His proposed reforms include lower prices from hospitals, salary cuts for doctors, and payment to hospitals by government insurance schemes linked to quality of care not quantity of care. He also wants to give Americans the option of a public health insurance plan. His plans follow a social insurance model which is found in some European countries.

Simplifying the funding structure within US hospitals could also lead to significant cost savings. At present an individual US healthcare provider may have to administer payments through upwards of 700 different providers.

Past research (1) has shown that while the United States spends significantly more on health care per capita than Europeans nations, Europe actually delivers more real resources per capita. For example, Europe employs a larger health workforce per capita and delivers more physician visits, hospital days, and prescription drugs than the United States. Higher prices and administrative inefficiencies account for most of this differential.

Obama's grand plan could end the American medical tourism dream. Introducing what is in effect a publicly funded healthcare system and forcing down prices could remove a key driver for outbound medical tourism from the USA.

The IMTJ's conclusion:

"If Americans are a target market, you need to keep a very close eye on US healthcare reform as it could quickly impact your business. You may even have to change from marketing on price to marketing on quality alone."

...and I tend to agree.

Recent years have seen a bandwagon effect in the medical tourism sector. And it's been a "get it cheap" bandwagon. But for decades medical tourism has been driven by patients seeking better treatment, specialist expertise, and higher quality. Some new market entrants may need to rethink their strategy.

1 Mark V. Pauly, “US health care costs: The untold true story,” Health Affairs, 1993, pp. 152–9.

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NHS Patient Choice - Lessons for medical tourism

In the UK, "patient choice" is one of the driving forces in healthcare. Since April 2008, patient choice has been extended in the UK. Patients can choose which hospital they are treated in....anywhere in the country. Patients can choose the time of their hospital appointment. In some cases, patients can choose the individual consultant they see. The NHS Choices website lists information about all NHS hospitals, such as their MRSA rates, facilities and ratings and reviews by patients which means that patients can make an informed choice.
The NHS Choose and Book web site enables people to make their choices.
In reality, the patient choice initiative has been a bit of a disappointment. One problem is that not enough patients are actually aware that they have a choice. The Report of the National Patient Choice Survey, England - December 2008 has analysed uptake of patient choice so far.
The key findings:
The percentage of patients recalling being offered a choice of hospital for their first outpatient appointment was 46% in December 2008, the same as in September but up from 30% in the first survey (May/June 2006)50% of patients were aware before they visited their GP that they had a choice of hospitals for their first appointment, up from 48% in September and 29% in the May/June 2006 survey.

The factors influencing choice

Hospital cleanliness and low infection rates were given most often (by 74% of patients) as an important factor when choosing a hospital.The other five are quality of care (given by 64% of patients), waiting times (63%), the friendliness of staff (57%), the reputation of the hospital (55%) and location or transport considerations (54%).

So what can medical tourism businesses learn from this?

If UK patients can compare NHS hospitals on MRSA rates, post operative infection rates and outcomes, why can't they do this for overseas hospitals? Or perhaps, why is it difficult if not impossible to find a hospital treating medical tourists that publishs such data or makes it freely available on their web site?

Many people in the UK have the right under EU law to travel abroad for treatment. The EU Directive sets up a framework around this. but the basic right of free movement already exists. So, why aren't people taking advantage of this?

They don't know they have the right.They don't "trust" overseas hospitals.They would rather wait for treatment on the NHS in their local area.

Awareness of overseas treatment options can be generated by the providers themselves. One of the best tools to consider is the use of patient stories to create local press coverage and thus raise awareness. See this story in the Scotsman. Let's see more of them!

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Increase in IVF tourism in Europe

At Treatment Abroad, we've seen increasing interest from IVF clinics abroad that are experiencing significant growth in patient numbers from the UK and other European countries.

The latest report from the European Society for Human Reproduction and Embryology confirms an increase in IVF treatment abroad, The report surveys infertility clinics in Belgium, the Czech Republic, Denmark, Slovenia, Spain and Switzerland and is based on a sample of 1,230 patients visiting these infertlity clinics. See details of the report in the Guardian.

Lack of access to IVF services in the home country for the over 40's and legal restrictions on infertility treatment are the prime drivers. Italy was the biggest source of IVF "medical tourists" accounting for 32% of the patients in the survey. Next was Germany (14%), followed by the Netherlands (12%), France (9%) and the UK (5%). The average age was over 37 but 63.5% of the British patients were over 40.

According to study coordinator, Dr Francoise Shenfield from University College Hospital in London, "Spain and the Czech Republic are popular destinations for oocyte donation; Swedes travel to Denmark for insemination, and the French to Belgium." She also highlighted the significant numbers of Italians who travel abroad to receive treatment that was rendered illegal in their home country under recent legislation or because they believe they will receive better quality care.Extrapolating the data, EHSRE estimates that 20,000 to 25,000 cross-border fertility treatments are carried out each year.IVF related medical tourism is a relatively new but growing trend in the UK, as couples delay having children into their 40's and then discover that they have a problem.

IVF treatment is available within the National Health Service in the UK, but access to treatment can be a problem.

Age and waiting lists can be a barrier to treatment.
Overweight women are excluded from NHS treatment.
Demand for egg donation exceeds supply. ( The right of anononymity for egg donors was removed in 2005)Obviously, private IVF treatment is available in the UK but this may be expensive and the same legal restrictions will apply.

Whereas some areas of medical tourism may be feeling the effects of the recession and the resulting impact on people’s pockets, IVF treatment abroad is an opportunity worth pursuing for those IVF clinics abroad that can demonstrate impressive results and cater for the needs of the “fertility tourist”.

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EU votes on medical tourism directive

Members of the European Union's various committees vote this week on whether to make changes to the EU Directive on cross border healthcare. The Directive aims to provide a framework for patient mobility, whereby patients in one member state will have the right to treatment in another state.

The UK's General Medical Council (GMC), which regulates the country's 230,000 doctors, is running a lobbying campaign to protect Britons seeking healthcare in Europe from what it describes as "dangerous" doctors. the GMC wants the new EU laws to give patients access to the disciplinary history of incompetent clinicians.

Quoted in the Guardian, Paul Philip, the GMC's deputy chief executive says:"The vast majority of doctors do a very good job under very difficult circumstances. However, when UK patients travel to mainland Europe, there is a risk they could be treated by a doctor who is not fit to practise or not fully qualified to give the required treatment."

UK patients have full access to GMC records and are able to check whether a doctor has been disciplined, or is the subject of a disciplinary hearing. The GMC wants doctor organisations in other countries to provide similar patient access to information about their doctors.

In the first 9 months of 2008, the UK NHS paid for over 500 British patients to have treatment elsewhere in Europe. Some patients were also funded by their primary care trusts. It is estimated that another 80,000 Britons funded their own treatment overseas.

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A word of warning for medical tourism companies

A woman from Wales who underwent cosmetic surgery in Belgium is bringing a test case against the Belgian clinic in the UK courts.The patient is suing the clinic after undergoing a face-lift and upper and lower eye surgery in 2005. She claims that she has been left with scarring around the eyes and the ears and has experienced numbness of the face.

It is a significant case because it could set a precedent for other patients who wish to sue a clinic or medical tourism company after going abroad for treatment. Rather than sue in Belgium, the legal firm involved have decided to sue the clinic in the UK courts where they might expect higher payouts if they win the case. Laurence Vick, the solicitor who is representing the patient, is a medico-legal expert and specialises in clinical negligence claims. (Coincidentally, he and I were undergraduate students at the same college, many years ago!)

The question of who to sue in medical tourism cases is one that faces any patient where surgery abroad doesn't work out as it should. Is surgery abroad any riskier than surgery in the UK? No one knows.... because there is no comparative data. But the answer is probably not. Nevertheless, any surgery carries a risk. Cosmetic surgery is not risk free, so there are going to be cases of alleged clinical negligence where the patient will pursue a legal action. Medical tourism companies need to be aware of this test case, particularly those that have a UK presence. Rather than sue the surgeon or the hospital in the destination country, the patient may opt to sue the medical tourism company in the UK.

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The opportunities for Korea in medical tourism

South Korea is a country that has come late to the medical tourism game, but it may in the long term become one of the winners. Perhaps initially attracted by the inflated forecasts that are touted around the medical tourism industry by “industry experts” and commentators, Korea has however taken a more realistic view of where its success may lie.

The recent Busan Medical Tourism Convention provided an insight into how Korea is thinking about the opportunities presented by medical tourism. In 2010, Korea is expecting to attract around 60,000 medical tourists and the target is to attract 140,000 in 2015. This is not an unreasonable target and is far more realistic than some of the numbers that we see appearing from government and tourism organisations in other countries. The “highest quality, lowest cost” strategy is not one that Korea wants to pursue or indeed should be pursuing. Korea’s research into existing medical travellers shows that quality, convenience and trust factors far outweigh cost related drivers. In terms of relative costs of healthcare services, Korea is significantly less expensive than the USA (but then every country is) but is not as price competitive as countries such as India, Singapore or Thailand. Indeed, something like a knee or hip replacement would cost a similar amount in Korea to the cost of private treatment in the UK.
So, Korea is not going to win on cost. Nor is it going to attract vast numbers of medical tourists from Europe. Its prices aren’t competitive enough and long flight times will deter potential European patients. The same may apply to patients from the USA if the much hyped US medical tourism boom begins to happen. For a US patient, the perception of quality of care in medical destinations such as Korea, Singapore and Thailand may be very similar. So, if it comes down to the cost factor, Korea will lose out.

So, from where is Korea looking to attract its patients? The drivers of accessibility and cultural match provide the answer:

Although the USA is a twelve hour flight away, cultural connections mean that the Korean community within the USA has to be a prime target. Around 1.2 million Korean Americans, many of whom are on the West coast should provide a source of patients.
Within a one hour flight from Korea is Japan, already a source of many cosmetic surgery tourists, and where healthcare costs are rising fast.
And not much farther away is China which may provide a plentiful supply of medical tourists in the longer term.
The interesting market that Korea and many countries are turning their attention to is Russia. With the movement towards a market economy in Russia, there’s a wealthy upper class that is investing abroad, taking holidays abroad....and seeking healthcare abroad.

How can Korea create a competitive advantage in the overcrowded world of medical tourism? It may not be in Western medicine; Kang Dong Hospital in Busan is a Korean hospital that combines Western medicine with “traditional” oriental medicine and provides a model of healthcare that is attractive to many in the Far East.

Another opportunity is for Korea to build on its existing strengths and the image it has created in world markets. Through the success of companies such as Samsung and LG, Korea has created a hi-tech modern image for itself. Applying its technological knowhow and skills to the medical tourism sector may prove advantageous in creating an edge over the competition. The only technology company that I have encountered at a medical tourism conference so far is Samsung.

It has been said that Korea’s success in technology and in manufacturings industries such automotive lies in its ability to copy what others are doing, learn from their mistakes, do it better and work harder at it. If Korea applies the same philosophy to medical tourism, then some of the more established destinations will be looking over their shoulders.

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NHS staff numbers reach an all-time high

The UK Department of Health today released it's latest update on NHS staff numbers. It reflects the investment that the UK has been putting into the NHS in recent years, and also has an impact on outbound medical tourism from the UK. NHS shortcomings and waiting times are a significant driver of people seeking elective surgery abroad. In the last couple of years NHS waiting times have come down and there is now an 18 week target which most NHS trusts are meeting.
The number of people working for the NHS has reached an all-time high. After a dip in overall numbers in the previous two years, the annual NHS census showed staffing levels recovered to reach a peak of 1,368,200 in September 2008. This is a 2.8 per cent increase on the previous year and a 27.7 per cent increase compared to 1998.

In September 2008, the NHS employed:408,200 qualified nurses – up 2.1 per cent or 8,600 on 2007 and up 26.2 per cent or 84,700 on 1998.25,700 midwives – up 2.3 per cent or 570 on 2007 and up 12.4 per cent or 2,800 on 1998.34,900 consultants – up 3.7 per cent or 1,200 on 2007 and up 56.4 per cent or 12,600 on 1998.49,200 hospital doctors in training – an increase of 5.1 per cent or 2,400 on 2007 and up 59.4 per cent or 18,300 on 1998.

The number of people in employment in the UK was 31.32 million in December 2008 which means that 4.4% of the UK workforce is employed in the NHS.

The UK unemployment rate has now reached 6.5 per cent. So, the NHS is quite a good place to have a job!

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