Today, we look at an interesting cost-cutting concept called “medical tourism”. We are joined by Billy and Akaisha Kaderli, from Retire Early Lifestyle Blog, who have explained the ins and outs of this frugal healthcare management technique. If you haven’t already read it, be sure the check the interview they participated in to reveal how they achieved financial independence in their late 30s!
Thanks for joining us again today! Please summarize the concept of medical tourism and its importance.
Generally, Medical Tourism refers to going elsewhere other than your own city or state to receive medical care. For example, people in the U.S. have been going out of their home state to Mayo Clinic for years, and no one thinks twice about it. Canadians will come to the U.S. for procedures perhaps because they don’t want to deal with long waits in their own home country or maybe they have other personal reasons.
Today, there are dozens of countries like Thailand, Mexico, Costa Rica, India, Guatemala, Singapore and the Philippines which offer excellent medical care delivery in ultra-modern facilities for very affordable prices.
The importance of medical tourism – and this cannot be overstated – is that its availability offers options to those who are:
- Not insured and,
- For procedures not approved in the USA (or the patient’s home country).
What are the cost implications of medical tourism? How should one evaluate an option (i.e. country & hospital) and how should one budget for it?
In terms of budgeting for medical tourism, we think it’s a good idea to have an emergency fund, or institute your own style of a Health Savings Account, where you only utilize that money for health related issues.
When you purchase medical care overseas, you will know how much it will cost before you purchase. There is no guessing game because you check off what you want as if from a menu. If you want to have an “Executive Physical” for instance, you can choose all the features you would like: lung x-ray, bone density test, colonoscopy, full panel blood tests, etc. and with every choice, your total at the bottom of the page changes. You see beforehand what your cost outlay will be and what price everything is individually.
The delivery of medical care in the States is expensive and out of the reach of many. If you have a high deductible, and you go out of network, sometimes that deductible doubles.
Treatment in the States for a heart condition or cancer can cost hundreds of thousands of dollars. Not so overseas.
A heart valve replacement in the States can cost $170,000 but will run you $24,000 in Guatemala City. Chemotherapy in the States runs about $75,000 but is under $20,000 in Guatemala City. A bone marrow transplant can cost up to $200,000 in the U.S., but will run up to $25,000 in India. A spinal fusion runs between $80-100,000 in the United States but will cost you $6-10,000 overseas.
There are many medical tourism concierge services available and websites of hospitals in various countries have their prices listed for procedures. Shopping for a medical service provider overseas is to be taken seriously. Depending on which company is chosen and the package you purchase, rehabilitation, medication and follow up care is included in the price.
One way that you can ease your mind is to look for hospitals that have JCI accreditation. Joint Commission on Accreditation of Healthcare Organizations International gives foreign doctors and hospitals endorsement and makes sure that they have the proper training and use proper procedures. Doctors are board certified or have similarly high standards of accreditation and this organization is highly respected in the United States.
You can find out more information about this topic on our medical tourism page.
What are some driving factors behind the rise of medical tourism (MT)?
Affordability, no waiting in lines, no penalties for pre-existing conditions, simple paperwork, and good quality of care are all factors that have pushed medical tourism to the fore over the last several decades. The fact that the health care system in the States has been absolutely tortuous for so many has also been a factor.
How is MT different from employer-sponsored medical travel?
In some respects it is not different at all, in that one would be receiving medical care outside of your home city or home state. However, the big difference is that in employer-sponsored medical travel, the employer pays for the procedure and probably has a list of accepted hospitals and doctors from which to choose. In full-fledged medical tourism, you, the patient would be locating the hospital, comparing prices, arranging for your air flight and transport to the hospital and so on. This is where the concierge services come in handy, as they offer you packages where door-to-door service is covered in one price.
Often a traveling companion is included and encouraged, so that you are not alone. Their hotel or living quarters can be near to or adjoining the hospital.
In our case, we live continuously overseas, so we receive our medical tourism care in the countries we visit. We have had care delivered to us in Thailand, Vietnam, Guatemala and Mexico.
What role does insurance play in this? Is it still a good idea to get health insurance in your country of residence?
We do believe it is a good idea to get health insurance in one’s country of residence. For all the benefits of medical tourism, in case of a catastrophic accident or medical emergency, one is not going to simply hop a plane and arrive at a hospital thousands of miles away.
We have been continuous travellers for almost three decades now. When we lived in the States we had a high deductible and a catastrophic health care plan in case of emergencies. However, we received most of our medical care (yearly exams, eye glasses, emergency care, physicals, colonoscopies, dental work, etc.) while we travelled overseas.
Eventually, due to our lifestyle and travel schedule, we dropped our U.S. based health insurance plan, and – as they say in the international traveling community – we “went naked.” This simply means we self-insure. When we travel to the States we take out traveler’s insurance, which is useful and helpful, but of course doesn’t cover every circumstance.
How does one go about shopping for the ideal medical service provider in a foreign country or state?
If you are living full time overseas as an expat, the country of your new residence usually offers residents of their country insurance options. For instance, Mexico has their IMSS insurance program. There are also international insurance plans available from companies like Bupa, Globality Health, and IHI.
As with shopping for any insurance company, one needs to compare pricing and coverage.
In our particular case, we are self-insured, carrying no insurance plan at all, and paying out of pocket for services. This approach may change as we continue to age, and soon, we will be eligible for Medicare in the States.
For more information on international health plans, see our health insurance page.
What financial and non-financial risks are associated with medical tourism?
One obvious financial risk is that in our case, with no health insurance coverage, we pay for everything out of pocket. When we made the decision to “go naked” of health insurance, we calculated that the amount of money we were saving in premiums would be put toward the actual cost of medical care, not medical insurance.
As insurance costs have risen in the States, the tens of thousands of dollars we have saved on premiums have added up. So, to pay for a procedure or medical emergency that might cost $50,000 to $100,000 in a foreign country has virtually already been paid for.
Thanks for taking the time to answer these questions.
Thank you for this opportunity. We appreciate it. Feel free to ask us questions at any time.