Consumer Focused Health

If you listen to insurance companies and government healthcare proponents, you would believe that Americans are unable to determine value for care and therefore a benevolent, paternalistic entity is required to determine what types and how much care is “necessary” for all Americans and at what prices it should be delivered.

And yet, if you look at what happens when people are aware of differences in value of care across borders, its pretty clear that greater transparency will create huge shifts in pricing and approach to health services if and when retail transparency reaches consumers.

Hundreds of thousands of people already receive medical procedures across borders today. Interestingly enough, this includes people from developed countries with nationalized insurance as well as those with and without insurance from the US. When facilities are high quality, a fraction of the cost, and provide immediate service, and do it with a smile, there are numerous reasons to go.

What does this mean for countries providing this service? Often they utilize doctors trained in the US or other high-quality residency programs who return home with similar skills to Western doctors. Large hospitals catering to the wealthy and foreign nationals claim to provide care at an international standard (Brumrungrad, Singapore Medicine, Apollo Hospitals). Less-skilled providers and less-impressive facilities are left to provide care at a different, local standard. This is becoming a model that resembles the tiered hotel industry– and international players are establishing brands or utilizing international reputations to get into the act.

What are the implications of the existence of medical tourism?

1. Patients are seeking better value for care– and when pushed, can locate it a continent away with a few simple tools. Imagine what they’ll do when meaningful differences in care are highlighted in their own backyard.
2. Patients don’t want the lowest cost option– the international facilities chosen need markers of high quality (even if it is only cleanliness and a professional approach to care) before they are even considered. Many “price transparency” schemes miss this distinction today– and ignore markers consumers need to choose a cheaper provider
3. Brands providing a consistent expectation across geographies will be increasingly be used to calibrate patient expectations. These brands can either be provider brands expanding across geography or comparison shopping/information services
4. The similar global arbitrage forces for labor will push physicians to show higher value for their higher pay (you’re starting to see this with retail clinics)