“Uncertainty” is the word to best describe market reaction to the repeal of the Affordable Care Act, with changes that signal escalating healthcare costs for individuals and employers. In this new environment, “travel for treatment” programs, both domestic and international, may finally get the attention they deserve from potential medical travelers in virtually every market niche.
The swelling ranks of the uninsured will be scrambling to find truly affordable quality care, and may choose to go abroad. Predictions are that the number of Americans traveling overseas for medical care or episodes of treatment is expected to increase 25% annually over the next decade, according to BenefitsPro.
Self-funded employers seeking to lower healthcare costs and increase financial margins may re-double their efforts for direct-to-provider contracting, also known as “U.S. domestic medical travel.” It’s a model whereby employers steer employees to more cost-effective Centers of Excellence (COEs) that demonstrate quality outcomes but are located outside their home state or region.
Employers are also sending workers to foreign hospitals that have become COEs as a result of knowledge-transfer programs and training offered by U.S. institutions and providers. These collaborative efforts are bringing American ingenuity, sophisticated technology and advanced levels of care to hospitals in Mexico and throughout the Caribbean or locations worldwide.
Employer groups of every size can immediately implement direct-to-provider contracting and domestic medical travel programs to generate cost savings and positive outcomes—without waiting for the ACA demise, tax abatement or regulatory relief. Many U.S. COEs are ready to offer bundled pricing for joint replacement surgery, cardiac, oncology and urology procedures, or bariatrics. Sending employees to these destinations by plane, train or automobile pays dividends to the company’s bottom line with cost savings, reduced readmissions, quicker return-to-work and enhanced patient satisfaction.
Traveling to another country is another avenue for employers to generate even greater savings without sacrificing quality of care. Several hospitals, particularly in Central and Latin America, have sharpened up care delivery, adopted U.S. clinical protocols, and elevated standards to meet or exceed benchmarks for quality and safety. Many are now accredited by Joint Commission International, an extension of Joint Commission. Hospitals and providers in countries that are in closer proximity to the U.S. are likely to become the destinations of choice, offering less travel time, expenses and minimal language barriers.
In fact, there is one U.S.-based organization, North American Specialty Hospital, now offering a program in Cancun that is unique to international medical travel: U.S. orthopedic surgeons located in cities throughout the country and who are covered by U.S. malpractice insurance provide pre- and post-care in the U.S., and travel to Cancun to perform surgery.
The savings on joint replacement surgery are as much 60% less than U.S. rates, and the program features bundled pricing with continuity of care. For the first time, this model overcomes one of the main barriers that has historically stunted international medical travel: Employers have recourse if there are less-than-optimal outcomes.
Individual market enrollees
The unraveling of the ACA will undoubtedly result in an increased number of uninsured individuals. As the burden of payment transfers onto healthcare providers and systems, they will be forced to continue cost shifting onto the backs of paying customers. Furthermore, there may be a declining number of insurance companies willing to underwrite coverage in the exchanges, leaving individuals with limited coverage options.
Left adrift and the victims of cost-shifting, many Americans will be forced to pay out of their own pockets for healthcare. Those who can afford a plane ticket will find it increasingly attractive to travel outside the country for quality medical care at lower costs—including joint replacement, cardio-thoracic surgery, oncology, bariatrics and a host of other medical procedures, including treatment for hepatitis C.
For Medicaid beneficiaries who remained optimistic that their home state would offer expanded coverage, their hopes have been dashed. Fixed payments from the government to the states, known as block grants, could replace the current system, resulting in significant cuts in federal Medicaid support and reduced services for low-income residents.
Strapped for cash to fund expensive care in the U.S., Medicaid beneficiaries might have the resources—or can gather support from family and friends—to access care at a fraction of U.S. rates. Emigrants from Central and Latin America, in particular, can travel to their homelands where they feel more comfortable and healthcare costs a lot less.
An aging population and the likelihood that many seniors will require surgery favorably positions international medical travel for those facing higher premiums, deductibles and cost-sharing. The infamous "donut hole" in Medicare's prescription drug coverage may return, prompting many who are 65 and older to travel outside the country and purchase drugs at lower costs, which is known as “prescription medical travel.”
Under a full repeal, Medicare enrollees may also lose some of their free preventive benefits, such as screenings for breast and colorectal cancer, heart disease and diabetes—another reason to travel abroad.
An era of change
An ACA demise forecasts distinct changes in medical travel patterns, as Americans move beyond traveling solely for elective procedures, dental care or aesthetic surgeries. Many are now likely to seek reliable medical treatment for complex conditions in nearby destinations. Benchmarks for provider selection, cost transparency, determining legal recourse and other issues will surely surface.
Laura Carabello, principal, CPR Strategic Marketing and Communications, is a medical travel consultant to healthcare providers worldwide and U.S. employers. She serves as editor and publisher of Medical Travel Today, medicaltraveltoday.com and U.S. Domestic Medical Travel.com.