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Thursday, July 1, 2010

UNCP economists report medical tourism on the rise

Consider heart surgery in Singapore? A hip replacement in India? Dental work in Costa Rica? How about a facelift in Turkey?

Jim Frederick

Jim Frederick

Lydia Gan

Lydia Gan

Black Line

It could be in the future for more U.S. patients, say two UNC Pembroke economists who have been researching medical tourism for the last two years.

Dr. Lydia Gan and Dr. Jim Frederick said patients can realize large cost savings abroad and more Americans may be headed that way.

“It may be that a health insurance company refers you to a foreign hospital,” Dr. Frederick said. “They might waive deductibles and co-pays and pay for you and your spouse’s travel.”

“The savings are quite large, as much as two-thirds to three-quarters,” Dr. Gan said in a June 14 interview. “In three weeks, I have an appointment to get a crown from a dentist in Singapore.”

Although not a typical U.S. medical tourist, Dr. Gan’s interest was sparked by personal experience. Once her eyes were opened to the economics of medical tourism, she felt there was room for academic inquiry.

One thing the UNCP economists found is the growing number of medical tourism “facilitators,” who link patients with foreign hospitals. One of their papers, “Medical Tourism Facilitators: Patterns of Service Differentiation,” studied the businesses of 46 facilitators.

Another developing trend, the researchers found, is that U.S. healthcare companies are beginning to ally themselves with foreign hospitals. Foreign hospitals are eager to do business, and many are JCI accredited (Joint Commission International, the leading international accrediting agency and an affiliate of the organization that accredits U.S. hospitals).

Drs. Gan and Frederick are studying all aspects of medical tourism, including consumer attitudes and barriers to it. They have developed two surveys, one for consumers and one for facilitators, and posted them on their Web site: www.uncp.edu/mtrc/surveys/.

“This summer, we plan to conduct face-to-face surveys in Southern Pines, Fayetteville, Pembroke, and Dunn,” Dr. Gan said.

“We are interested in the perceptions of medical tourism from a variety of perspectives,” Dr. Frederick said. “The first thing we want to know is whether consumers have heard of medical tourism.

“We want to learn the barriers to medical tourism, such as travel or cultural differences,” Dr. Frederick said.

Who is taking advantage of medical treatment abroad?

Those traveling to obtain medical care abroad today most likely lack health insurance. Cosmetic surgery, weight loss surgery and dental care are also popular because they are not covered by health insurance.

“There's a rule of thumb in the industry,” said Dr. Frederick. “If a procedure would cost more than $6,000 in the U.S. – some say more than $10,000 –  it would be worthwhile to have it done abroad.” 

For example, a heart artery bypass could cost $130,000 in the U.S., but may only cost $20,000 in a good hospital in Asia. Dr. Gan added, “For an uninsured working person, this could be the difference between losing your house and keeping it.”

The UNCP economists said the playing field may be shifting because of U.S. health care reform.

“It’s not the rich who are traveling for care today, but that may change if reform results in long waits for care,” Dr. Frederick said. “Healthcare reform may push a different group abroad.”

The future is up for grabs for health insurance companies who want to hold down costs.

There is much more to learn about the economics of medical tourism, and Drs. Gan and Frederick see a wide open field.

“One of the things that attracted us to medical tourism is that there is so little national data available,” Dr. Frederick said. “We are actively seeking data and collaboration with others in the field.”

The pair is actively seeking funding for their work through grants. They hope to hire student workers in the fall to work with data collected through their Medical Tourism Research Center.

“Because we teach, this is a part-time project,” Dr. Gan said. “We don't have as much time as we would like to administer the center and to collaborate on research.”

The research has paid off in two published articles, several presentations and additional articles in progress and pending publication.

For more information or to take the survey, go to the medical tourism Web site at www.uncp.edu/mtrc/.

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