Biomedical Business & Technology

Sorry, Christopher Columbus, it turns out that the world is flat.

No, not in the sense that you will fall off the edge if you sail too far west. Rather, it is a leveling of the global playing field for businesses and all sorts of entrepreneurial activity — an idea thoroughly explored by Thomas Friedman in his book arguing a newly leveled world via globalization (The World is Flat, Picador, 2007). And the concept of global outsourcing is expanding far beyond the information technology industry. It has been common practice for European patients to travel to other countries for medical care, and it recently is becoming a more frequent practice for those in the U.S. seeking a range of procedures — from liposuction to heart bypass.

An estimated 500,000 Americans traveled outside the U.S. last year for some type of medical procedure, and in the next couple of years that number is expected to balloon to several million. The drivers for this trend? A whole bunch of them: the rising costs of U.S. healthcare, record high numbers of health-uninsured (and-underinsured), a wealth of online information concerning new care options, the ease of international travel — and, importantly, the chance to travel to interesting, often exotic countries.

But medical tourism raises a variety of questions:

• Is this trend just a fad that will fade, or something that will become a boom — and require some sort of international regulation?
• What is the actual quality of overseas healthcare offerings? Is medical tourism a threat to patient safety?
• How is medical tourism being marketed, and how do patients sort through the marketing verbiage to make informed choices?
• And what are the implications of medical tourism for U.S. med-tech and healthcare providers?

'Wild west' medicine

While travel to distant lands suggests a certain amount of adventure, the real adventure of the sector may be in its lack of regulatory oversight.

The industry is "a little bit like the wild west," says Peter Lindland, in a conversation with Biomedical Business & Technology. He worries about the lack of regulation and the fact that any Tom, Dick or Mary can suddenly decide to launch a website and start a medical tourism company — regardless of experience or expertise.

Given these concerns, Lindland about three years ago founded Medical Nomad (Naples, Florida), a medical tourism information website, after he became a medical tourist himself.

Working as a family practice physician assistant, he found he needed some "rather significant" dental work. He had healthcare insurance, but it didn't include dental coverage, and in the U.S. the work would have cost him $14,500.

"That would have been a hit," Lindland says.

Mining some family contacts in Guatemala, Lindland was put in touch with a "well recommended" dentist. Taking the plunge, he traveled there for his dental procedure, and saved about $10,000 — since his medical tour cost was just $4,500.

But while he was researching his medical options abroad, Lindland "couldn't find any type of website, database or company specializing in people looking for choices outside the U.S.," he says. The lack of online resources at the time prompted him to consult a technology-savvy friend to help him design a consumer-focused website for people to explore their medical tourism options. Lindland says he designed it to be the website that he wishes had been available when he was looking for information about traveling abroad for his dental work.

Of course, since launching Medical Nomad, he has seen countless companies pop up to serve patients interested in healthcare abroad. "It's been amazing ... we've seen this industry just kind of explode," he says. "There's new brokers online every day."

Unlike so many of the sites dedicated to medical tourism, however, Medical Nomad is strictly an online resource, not a for-profit business, Lindland says.

"I like the idea of empowering the medical consumer, giving people choices," Lindland says. But he acknowledges: "We haven't really monetized ourselves at all. We're kind of a work of charity."

Lindland isn't the only person concerned about the lack of rules and regulations. Just in the last six months the Medical Tourism Association (MTA; West Palm Beach, Florida) has been formed as a non-profit organization with the goal of attempting to help regulate the laws and promote quality healthcare for medical tourists.

It aims to set credentialing standards for hospitals and medical tourism companies, and to increase the awareness and use of overseas hospitals for Americans. "And to make sure that the hospitals we recommend are the ones that have equal to or better healthcare than we have in the U.S.," says Jonathan Edelheit, president of MTA and VP of OptiMed Health/United Group Programs.

Filtering out the not-so-reputable

Edelheit told BB&T that the first step the MTA takes to filter out the not-so-reputable medical tourism companies from the reputable ones is to have potential members fill out a "very detailed" questionnaire.

"The purpose is to really get some background on the company, find out how long they've been in business what their experience is with hospitals," Edelheit says. "There are some medical tourism companies that actually have doctors and nurses on staff that's a real perk, to know you're dealing with a doctor or nurse who actually understands your condition."

One such company is Med Journeys (New York), which offers to coordinate a conference call between the patient, the doctor abroad, and the company's medical team. Med Journeys also says its team of doctors and nurses will give the patient its "expert evaluation."

While having an MD or registered nurse on staff is one strong sign of a credible company, Edelheit says this isn't an absolute — that there are also quality companies that don't have medical teams.

MedRetreat (Vernon Hills, Illinois), for example, does not have any doctors or nurses on staff because the company says this just adds a complicating and unnecessasry layer. Rather, it prefers to put its patient customers directly in touch with the surgeon who will be doing the procedure rather than offering any medical advice.

"We're not a medical company, we're communication experts," Patrick Marsek, managing director for the company, told BB&T. "We get it right from the horse's mouth."

Perhaps an even better way of screening medical tour providers and companies is customer referrals. Before becoming affiliated with a comany, the MTA will contact some of its patient customers to ask them about the quality of their experience.

Lastly, MTA makes sure that it is only dealing with quality hospitals. "We're not interested in companies that work with chop-shops ... hospitals that don't provide quality service and are just cheap or are paying higher referral fees [to the companies]," Edelheit says.

Thus, MTA requires hospitals to fill out a lengthy application before becoming a member, complete with reports of infection rates of infections, providers' credentials and data concerning outcomes.

So far, the association has about 50 members.

Standard-setting, accreditation spotty

Lindland says he is curious to see what the MTA evolves into, and he believes that, "ultimately, the entity that's really going to bring regulation to the industry is the government."

While the medical tourism industry has yet to deal with any hard and fast rules and regulatory parameters, one widely recognized organization in the U.S. has developed a set of international standards for hospitals and other healthcare facilities, — though the net it casts is less than comprehensive.

The Joint Commission International (JCI; Oakbrook, Illinois), a division of the Joint Commission Resources (JCR), an affiliate of the Joint Commission (both Oakbrook Terrace), launched a medical tourism accreditation program in 1999.

Karen Timmons, president/CEO of the JCR and the JCI, told BB&T that the standards were established by an international panel of experts to set uniform expectations for healthcare organizations serving this industry.

She says the JCI's process is designed to take into consideration a variety of factors concerning the services provided by overseas healthcare facilities. These range beyond the obvious healthcare issues to legal and cultural, even religious, factors.

Once every three years the JCI sends a three-person team consisting of a doctor, nurse and an administrator, to perform an on-site survey of each facility before renewing its accreditation. Additionally, JCI follows up on complaints it receives about specific hospitals within that three-year period. "Certainly, accreditation is a demonstration of an organization's commitment to quality and safety," she says.

The JCI has accredited about 130 hospitals serving foreign patients worldwide.

In August the JCI revised its international accreditation standards for hospitals, which the organization will use during its on-site surveys beginning in 2008.

Among the most notable changes, the organization said it would place more importance on the role of hospital leaders in overseeing all areas of performance. The revised standards also will include new chapters on anesthesia and surgical care, medication management and use, and management of communication and information.

The new accreditation manual will also include the organization's six international patient safety goals, which were introduced into the survey process this year, the JCI said. Those goals include the correct identification of patients (especially when giving medications, taking specimens, or providing any treatments or procedures); improving effective communication; improving the safety of high-alert medications; eliminating "wrong-site, wrong-patient, wrong-procedure" surgery; reducing the risk of healthcare-acquired infections (however the JCI noted that not all countries have an oversight organization such as the Centers for Disease Control and Prevention or recognize the standards established by the CDC); and reducing the risk of patient harm due to falls.

But JCI accreditation is both voluntary and price-resistant and thus hardly complete. Its accreditation comes with a price tag, the average fee for going through the accrediting process averaging about $30,000, depending on the size of the organization and the complexity of the services offered.

That's the reason not all of MedRetreat's hospital partners are JCI-accredited, Marsek told BB&T.

However, he says its representatives have visited each of its partner hospitals and stayed at each of the hotels it recommends, in order to be able to assure customers concerning service and quality.

When looking for hospitals to partner with, Marsek says that MedRetreat looks for cleanliness and follows what he calls a condensed version of the JCI's accreditation criteria, such as infection rates, mortality rates and how the hospital administers drugs.

He says that, in fact, the company has denied partnership to about 50% of the hospitals it visited based on those factors.

"These hospitals [that MedRetreat refers patients to] are the very best within their destination," he says. "We're not talking about a little clinic on the side of the road."

Marketing, marketing, marketing

If real estate depends on "location, location, location," so does medical tourism, in promising travel to interesting places. And its current growth hasn't been driven by a whole lot of marketing — something that U.S. healthcare providers probably ought to consider rather carefully.

MTA's Edelheit says most people seem to be learning about the industry through word of mouth and, not surprisingly, the Internet. And medical tourism companies are also enjoying a whole lot of free marketing, with the word-of-mouth experiences of medical touring patients fashioned into human interest news stories, including even a "60 Minutes" segment.

In the last three years newspapers across the country — the New York Times, The Wall Street Journal, USA Today, and the Washington Post, to name just a few — have covered this trend, highlighting the experiences of U.S. patients. Most recently articles about medical travel have appeared in Good Housekeeping and the AARP Bulletin — with AARP an organization that has recently focused on the growing numbers of the healthcare uninsured as a major concern and unlikely to send its members off on wild goose healthcare chases.

In addition to all the media attention, Lindland says a lot of the marketing in the industry is being done through Internet search-engine strategies. Companies trying to get an edge in the industry pay for Google Ad Words, he notes, to jockey for position.

MedRetreat even advertises within its own website via a podcast. And the company has created its own jingle that declares, "We're the American gateway to healthcare abroad, MedRetreat, medical tourism specialist," on its website.

So far these businesses have not shown much interest in the traditional advertising vehicles of print, television or radio, Lindland says. They haven't had to.

Hitting 'hot spots' — or not — for health

Of course, in selling the idea of medical tourism to patients, many companies in this sector are taking advantage not only of the lower healthcare prices available overseas, but also the exotic location of many of the international hospitals. The hottest medial tourism "hot spots" appear to be India, Singapore, Thailand, and Costa Rica, Edelheit says. Hence, MedRetreat's website tag line is "... where smart medicine and exotic travel come together."

But Marsek told BB&T that at MedRetreat, the overall philosophy is that the "medical" aspect should come first and the "tourism" part is just a byproduct of it. "The most important thing is to receive good, quality, medical care," he says.

If patients have time after their procedure to sightsee, great, he says. And while that's one of the "added value" pitches of medical tourism, he acknowledges that, more times than not, the touring part of medical tourism doesn't happen.

Especially after more complex procedures, "People just don't feel up to it," he says.

In a statement sent to BB&T, Med Journeys said that it seeks to accommodate its clients' needs through a "one-stop-shop" method that customizes the experience they will have, which can include a whole range of services and can exclude any of the touring or sightseeing components. The company offers its customers an "all-inclusive quote" which includes the medical procedure, accommodations, airfare, private transportation in the host country, meals, and personal assistance.

"Should they wish to recuperate in a five-star hotel rather than a guesthouse, we will gladly accommodate their needs in doing so," Med Journeys said.

From 'curious' to 'gold club'

A potential downside for consumers who decide to use one of the many medical tourism companies in the industry to plan their overseas medical trip is that they will be limited to the healthcare providers and facilities that the broker has a relationship with, Lindland says.

On the other hand, these companies warn that there are many issues not apparent to first-time medical tourists, and thus there are many benefits to using a medical travel service to plan the excursion. These companies usually can make all the travel arrangements from airfare to hotel accommodations and take care of all those "little details" that can add complications to any medical procedure. "One thing you don't need when you're going to receive a procedure is added stress," says Marsek.

The process of coordinating a medical trip for a patient can be quite involved, he adds. Typically, the entire process takes from 30 to 45 days, and MedRetreat spends about 20 hours in the planning process for each customer/patient.

To get started, a potential customer fills out an online application form through the company's website. Then, the company sorts through the applications to weed out the web surfers and the merely curious, which Marsek said is usually about 20% of the applicants. "We want to make sure we're spending our time with people who are serious about this," Marsek says.

Then, the patient receives a phone call from the company's director of facilitation to discuss the specific medical condition, the procedure needed and any specific travel needs.

More than 400 people are currently on track to receive service from MedRetreat, Marsek said. For those patients who want the company's free service and are not in a hurry, the wait time is about four to five months, he says. Otherwise, patients who can't afford to wait can become a "Gold Club" member and be bumped to the front of the queue via a $195 fee, applied to the procedure cost if they end up going through with the trip.

Then the patient selects a surgeon and a hospital, not unexpectedly the two most important considerations, Marsek says. However, he recognizes that most people interested in medical tourism are looking for a good deal and that some destinations, such as Southeast Asia, offer a better value than others.

Instead of offering package prices like those provided by Med Journeys and other companies, MedRetreat prefers to get a price quote from the surgeon specific to each patient and combine that with other cost factors to come up with the total all-inclusive fee.

Before the patient departs the U.S., MedRetreat also collects a 20% deposit to book the surgery. If, after meeting with the surgeon and touring the destination hospital, the patient decides not to go through with the procedure, the company says it will refund the deposit within five business days. The traveler is then responsible only for the cost of airfare and hotel stay during the time spent abroad.

Spreading the word

In response to the rapid growth of medical tourism, CPR Strategic Marketing Communications (CPR; Elmwood, New Jersey) recently has developed a free, biweekly, electronic newsletter, Medical Travel Today, geared towards stakeholders in the industry.

According to CPR, Medical Travel Today is the first publication to track the development of businesses providing healthcare abroad. Subscriptions are available at www.medicaltraveltoday.com.

"Medical tourism, practically unheard of just a decade ago, has grown rapidly into a multi-billion-dollar worldwide industry, with medical providers in more than 50 countries on six continents vying for international patients. A growing number of U.S. residents — and their health plans — are finding it to be an attractive option in terms of patient outcomes and the bottom line," says Laura Carabello, publisher of Medical Travel Today and founder of CPR. Carabello told BB&T that the publication also intends to be a voice for the MTA, since she is a board member of that organization.

She says her company has been planning the newsletter since the spring. "It's not something that's just going to be a feed of what's in the news ... it will have in-depth [articles with] reliable sources. It's not going to be the same-old, same-old," she says. "I really want this to be a credible, in-depth look at the industry."

CPR's publication will include a roundup of medical tourism stories worldwide; bylined commentary and perspectives from industry experts; facts and figures on top international healthcare providers; updates on medical tourism events and conferences; and book and article reviews.

The MTA is also attempting to raise awareness about the industry by publishing a monthly magazine, Medical Tourism. Edelheit says the first issue is expected out this month. The association also is working on a television documentary that will highlight the industry.

Getting flat, growing bigger

"As countries are growing and developing on a variety of fronts, we are finding that the world is truly becoming 'flat' within the healthcare space," Med Journeys said in a statement it sent to BB&T. And as the medical tourism industry continues to grow in this increasingly flattened world, some industry followers are eager to speculate on where the sector is headed.

For med-tech, of course, the prospects appear to be much more than a half-full glass — more likely a three-fourths-full glass.

While overseas competition will drive more sales to lower-cost venues overseas, the overall impact is obviously the availability of a growing worldwide patient pool willing to pay for quality care. This means that the healthcare pie is getting larger, with increased demand for more medical instrumentation and more of the higher-priced, higher-margin types of that technology.

Lindland says many observers of the medical tourism phenomenon foresee "pretty significant growth" in the sector, and he agrees with that assessment.

And Edelheit predicts that the industry is well on its way to becoming a mega-blockbuster in the $100 billion range in a few years.

A major driver of this growth is the number of Americans, now about 47 million, in the health-uninsured or under-insured category, Lindland notes But he also points to a variety of factors likely to place an eventual cap on uninhibited expansion of the sector: aging patients not healthy enough to travel internationally, the underlying fear that overseas healthcare will never be quite what American medical centers can offer, and continuing innovation in American healthcare that makes many procedures affordable even to those in middle-class economic categories.

"I think there's going to be a glass ceiling," Lindland says. "There are only so many procedures that can be outsourced." (Another limiting factor, of course, could be the eventual development of universal insurance coverage in the U.S.)

But one thing seems very certain: medical tourism is not just growing; its growing attractiveness and the media coverage it is producing may become one of those importnat "microtrends" that could alter the American healthcare landscape. More than just hype, it clearly is offering a different healthcare experience for hundreds of thousands of Americans, one that could offer active competition, even with universal insurance coverage.

And Lindland says that medical tourism is still another way of pushing forward a key issue in a society that frequently measures quality in terms of costs. While most Americans believe they have access to the best healthcare technology in the world, able to provide the best quality — they are becoming increasingly aware that they they don't have a good handle on the eventual costs, perhaps because they don't know exactly what they are paying for or what will be reimbursed.

"Medicine in the U.S. really is not a very free market; it's pretty opaque," he says. "You don't often know what you're going to pay."

Thus, via medical tourism, many U.S. patients for the first time may be making more informed and more deliberate choices about facilities and providers, and taking more responsibility for their healthcare costs, rather than putting their trust in a faceless, corporate insurer.