What Obama’s Affordable Care Act means for the world’s hospitals

SAN JOSE, Costa Rica — Sitting in blue scrubs in a hospital room, plastic surgeon Christian Rivera ponders a potential sea change for this Central American country’s private hospitals, triggered by health care reform in the United States.

That’s because his profession thrives on uninsured US citizens looking for cheaper care abroad. So what happens to medical tourism when US President Barack Obama’s Affordable Care Act grants almost all US citizens health insurance by 2014? Rivera hopes he has a positive answer.

In June, the US Supreme Court declared the core of the reform constitutional. Republican presidential candidate Mitt Romney, if elected, has vowed to repeal it. At the same time, overseas medical tourism representatives are searching for ways to benefit under the new law, often called “Obamacare.”

That name started out as a favorite pejorative for critics who deride what they see as a central pillar of Obama’s agenda for big government control. But now the law’s supporters have adopted the word for legislation they believe brings Americans closer than ever to universal health care.

But other changes could be under way. Some experts predict a doctor shortage and longer hospital waits in the United States. They also foresee insurance companies extending coverage for Americans’ international medical bills. If all this is true, medical tourism will have a healthy future.

US patients obtain health care treatment in foreign countries well below US rates. Treatments include dental implants, hip and knee replacements or bariatric surgeries. Americans also go abroad for more complicated procedures such as heart operations and cancer treatment, or alternative therapies such as stem cell treatment unavailable at home.

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Estimates vary on the size of the medical tourism industry. In December 2010, consulting firm Frost & Sullivan put the industry’s global worth at $78.5 billion. Patients Beyond Borders, a consultancy for consumer information on the sector, put it at $15 billion, counting 5 million patients worldwide in 2011.

Estimates for how many of the patients were American vary too: from 550,000 to 1.6 million.

In the developing world, many doctors now work like Rivera. Physicians and surgeons train at top US medical schools, return to their homeland — whether in Mexico, Central or South America, or Asia — and provide nimble treatment to anyone who can afford their care.

The economic benefits extend far beyond the doctor’s office. In Costa Rica, patients fly in to fill hospital beds, hotel rooms and spots in tour groups all on the same trip. They tend to stay longer and spend six times as much money than the average tourist, according to Promed, a Costa Rican nonprofit association representing the private health sector. American patients often bring the family, and spend their recovery at a beach resort or in a lodge in the rainforest.

In 2010, Costa Rica attracted 36,000 medical tourists — primarily US and Canadian citizens — who spent $295 million in the country, according to Promed.

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Those commanding numbers underline why it’s crucial for countries to understand the intricacies of Obamacare — and how to take advantage of it.

“One drop of business from the US is a tsunami for the Costa Rica economy,” Rivera says.

David Vequist researches medical tourism at the University of the Incarnate Word in San Antonio, Texas. He estimates that a little more than 1 million US citizens seek health care abroad each year.

The American population is getting older, fatter and sicker, he said. The US has a doctor shortage even while the country extends coverage to 30 million citizens. The Association of American Medical Colleges says the United States could have a deficiency of more than 62,000 doctors by 2015.

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If demand cannot be met, Vequist said, patients with the means to travel abroad will do so to obtain immediate care.

He predicts a slight drop in patients traveling abroad in the first two years of reform, and then an increase starting around 2015.

Some US businesses already persuade employees to travel for treatment. Medical tourism experts see that becoming more common in the future. With incentives like deductible waivers, the plan saves money for the insurance company, the business and the employee.

The health care reform does not cover many of the industry’s most popular procedures, such as dental work, which accounts for an estimated 40 percent of medical tourism. Elective surgeries and operations not offered in the United States, including stem cell treatment and experimental drugs, will not be affected by the reform.

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Countries like India, a medical tourism leader in the developing world, could face more of an obstacle since many Americans visit Indian hospitals for heart surgery and other procedures covered by US health insurance. Few will travel halfway around the world to get cavities filled.

Jonathan Edelheit, who runs the Medical Tourism Association, a Florida-based trade group, is bullish about the industry’s prospects in the face of the Affordable Care Act.

“Consumers are more educated than ever before on quality,” Edelheit told GlobalPost. “And when they find it they’ll travel wherever they have to."

He calls the law merely “insurance reform,” since it does little to slow the rising costs of pharmaceuticals or medical devices. The fines for opting out of insurance ($95 in 2014 and $695 in 2016) are too weak, he said, so young people will choose not to be covered, further straining the system.

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The Congressional Budget Office estimates 1 percent or roughly 4 million people will opt out and pay the fine instead of buying health insurance by 2016.

Glenn Cohen, a Harvard law professor who studies medical tourism, notes that in 2006, Romney, then the Massachusetts governor, overhauled the state’s health care system. Hospital wait times have not increased dramatically. The longest wait comes in primary care, averaging 45 days, according to a recent report by the Massachusetts Medical Society. Specialty care wait times are shorter. Better access to a doctor has helped improve patient wellness and disease prevention, thus reducing costly emergency room visits.

The severity of the doctor shortage likely will depend on the state. According to 2008 data by the Kaiser Family Foundation, Massachusetts has one of the highest primary care physician-to-patient ratios in the United States, with more than 1.5 doctors per 1,000 people, similar to most of the Northeast. However, states in the Mountain West and the South have far lower ratios.

The legislation includes some incentives for becoming a primary care doctor, but whether it fills the gap could mean a world of difference for countless international clinics.

Yet the government could choose to put limits on coverage for care in foreign countries, particularly if it sees problems with liability, quality and lack of transparency in their health sector.

There is no official global regulatory body overseeing medical tourism.

The closest thing perhaps to a hospital standard-bearer is the US-based Joint Commission International. It has accredited more than 200 hospitals and clinics in three-dozen countries that follow specific norms for quality and safety.

That helps health providers stand out among the competition.

Latin America and southern Asia held an advantage of lower costs over places like South Korea, Japan, Taiwan, Israel and Europe. Experts believe Latin America’s proximity to the United States, and the US’s large Hispanic population, will give the region an edge over Asian competitors after the reforms take place.

Yet Rivera worries Costa Rica could lose out to other major destinations. The surgeon is urging the Costa Rican government to promote clinics along with other traditional tourism hotspots in international advertisements.

“When you talk about Costa Rica the average American tourist thinks about jungle, rivers, volcanoes and birds,” Rivera says. “They don’t think about surgeries.”