Given the lower prices and high quality care available outside of the U.S., is anybody surprised by medical tourism's growth? Probably not. The real question is what should we do about it.
OK, I know I'm going to get some angry mail here, but why not just lower our prices by a substantial margin? Can we make that work if people are showing up daily with cash money to get important procedures done? I say, yes we can.
Let's look at how the market is shaping up. While his experience may not be unique, one medical tourism company CEO operating in Thailand tells me that pricing is a tremendous issue, if not the only issue, in why patients contact him. In other words, while his videos pitch the high-end amenities his tourists get, including high-gloss hotels and transportation, nice weather and the like, what people are into is the bottom line. Some customers are so price-sensitive, in fact, they go around him when they arrive just to avoid fees of about $200, the CEO says.
So what if the provider industry in the U.S. took a cue from this and rather than just posting prices, actually lowered them significantly? I'm not talking about charging patients the rates insurance companies get--which are actually still high compared with many foreign venues--but offering whopping discounts of, say, 70 percent to those who pay in cash on the day of the procedure or service. (I don't now if that number per se would work--you have your own spreadsheets--but you catch my drift.)
I'm not a big fan of CDHPs, but I do realize this is the effect they're trying to accomplish. The thing is, they're just a vehicle employers and the insurance industry are using to try and force down prices, which won't work. Providers who won't go low enough on pricing are using them until get a better trade off. And I think doing a lot more cash business could be just the ticket to make everyone happy. -Anne