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How will U.S. Healthcare Reform Affect Medical Tourism Jonathan Edelheit, CEO Medical Tourism Association™ Jon@MedicalTourismAssociation.


© 2012 Copyright Medical Tourism Association™

How will U.S. Healthcare Reform Affect Medical Tourism Jonathan Edelheit, CEO Medical Tourism Association™

©Copyright Medical Tourism Association™

Healthcare Reform was signed into law on March 23rd 2010 by President Obama

General Overview
* Presentation will not go into detail on Medicaid and Medicare reform under healthcare reform bill.

©Copyright Medical Tourism Association™

©Copyright Medical Tourism Association™ .

• There is now shock in the U.S.S. or at a minimum strike down the individual mandate. • MTA one of the few who actually believed it was likely to be upheld. insurance industry as many were not prepared for it.June 28th. • Many insurance agents and employers really expected the Supreme Court to strike down the entire law. ©Copyright Medical Tourism Association™ . Insurance Market. 2012 Supreme Court Ruling • The ruling by the Supreme Court shook the U.

2012 right after Supreme Court Ruling • MTA’s phones have been ringing off the hooks • What’s the feeling in the US insurance industry about how this will affect medical tourism? • Very Positive….Starting June 28th. • Insurance & HR Professionals feel Healthcare Reform will increase costs and therefore make medical tourism more attractive ©Copyright Medical Tourism Association™ .

regulation. interpretations and enforcement of the law. commissions.Can you Imagine: The Healthcare Reform Law is almost 3. boards. and many other agencies have not really even gotten started yet. bureaus. ©Copyright Medical Tourism Association™ . Health and Human Services. There are approximately 180 government committees.000 pages of regulations and the IRS. and there are almost 13. within the different agencies involved in providing the rules.000 pages.

“ The recent Health Reform legislation contains virtually nothing to encourage patients and providers to control costs.What do thought leaders think? Devon Herrick of National Center for Policy Analysis. By contrast.” ©Copyright Medical Tourism Association™ . where providers compete on price and quality. medical tourism represents global competition in health care. USA. Medical tourism is our best opportunity to encourage competition within the health care industry.

com/article/healthcare-reformsurvey.Views of Healthcare Buyers A survey from July 2010. It shows a sample of the future growth potential of the medical tourism industry.html ©Copyright Medical Tourism Association™ . 71 percent of insurance companies and employers felt healthcare reform was extremely positive for the medical tourism industry and more Americans would travel overseas under the new law. http://medicaltourismmag. Employers and insurance companies know that healthcare reform will increase costs and medical tourism is one of the few ways to lower those costs. discovers similar concerns among industry stakeholders.

Healthcare Reform grows this will be positive for the medical tourism industry and more patients should leave the U. hospitals may pull out of Medicare .S.S.Expected Affect on Medical Tourism •More U.S. which could drive more patients overseas •Deloitte Predicted if U.S. insurance companies and employers will implement medical tourism as a cost savings approach because of increased costs of health insurance • Longer waiting times due to more insured patients and doctor shortages may push American patients to travel overseas for shorter waiting times •More U. ©Copyright Medical Tourism Association™ .

©Copyright Medical Tourism Association™ .Healthcare Reform was meant to give basic access to care to more Americans and to provide “preventative and wellness” care at no cost to Americans.

you cannot give increased benefits without increased costs… ©Copyright Medical Tourism Association™ ..Healthcare Reform Positives •Waiving of pre-existing condition clauses •Eliminating annual and life time limits Benefits with repercussions : •Healthcare Reform was the expansion of healthcare benefits in the U.S. but there is a cost to this $$$$ •Common Sense and Economics .

The number of seniors and disabled people at risk of losing their Medicare Advantage Plan (Medicare Chief Actuary) 100 Million . ©Copyright Medical Tourism Association™ . mostly lower-wage workers and people who work for smaller employers.The cost of Healthcare Reform mandates for Caterpillar.Fraction of hospitals that would become unprofitable after Medicare spending cuts.5 Million . Inc) 20% .Statistics on Healthcare Reform from Different Organizations 19 Million . (Medicare Chief Actuary) Congressional Budget Office (CBO) estimated that 8 million to 9 million individuals. could lose their employer-sponsored coverage as a result of the legislation. Inc in the first year alone (Caterpillar.The number of people predicted to lose their employer plan (Lewin Group) 8.

763 •Family Health Insurance $38. • Individual Health Insurance .S.160 •These Costs are Not Sustainable & Americans will not be able to afford them in the future… ©Copyright Medical Tourism Association™ .•Before Healthcare Reform was passed High End Estimate of Health Insurance Costs in 2020 per year in the U.$13.

So what does Healthcare Reform really mean and what does it do? ©Copyright Medical Tourism Association™ .

insurers may no longer charge individuals and small businesses higher premiums or deny coverage on the basis of pre-existing conditions • Waiving pre-existing condition clauses and making insurance premiums the same for healthy/sick people will drive health insurance costs up dramatically.•It does not create a public government plan. whichever is greater •By 2014. making employers and insurers more interested in offering medical tourism as an option to keep costs down ©Copyright Medical Tourism Association™ . it still remains a private insurance industry •Health Insurance Exchanges will be created (and are currently) where people can go online and shop for insurance from multiple insurance carriers •Mandate that all Americans purchase health insurance or pay a fine •Fine mandates start in 2014 of only $95.5 percent of income. Starting in 2016 fine for not having health insurance $695 or 2.

This will cause people to hold off buying insurance until they are sick. It is almost a disincentive it is so small. BUT it needs to be tied to an individual mandate/fine that forces everyone to buy health insurance coverage. so that everyone has insurance. ©Copyright Medical Tourism Association™ . The current mandate/fine does not do that. Causing what is called adverse selection.Guarantee issue and no pre-existing conditions These are very positive and will especially help those who because of a pre-existing condition could not obtain health insurance coverage.

S.This will significantly increase health insurance costs in the U. ©Copyright Medical Tourism Association™ .

Safe drivers rates go up to cover bad drivers. It doesn’t penalize people who are waiting on purposeSo healthy people have incentive to opt out of health insurance.Problem is people could not buy health insurance until they are sick – destroys health insurance underwriting the whole basis of insurance. and your car insurance rates won’t be higher. you will pay same as safe drivers.Big drawback of how pre-existing waiver reads in Healthcare Reform Law . Recent example – have several bad car accidents because you are bad driver. ©Copyright Medical Tourism Association™ .

©Copyright Medical Tourism Association™ . supposed to be 5 :1 or 6:1 •Rates can’t magically come down.Senior Citizen Insurance Rates versus Younger Americans •3 to 1 rates. someone needs to subsidize them = young Americans •Seniors pay less •Young Americans pay more •It is already difficult to get young people to buy health insurance. this will drive them towards paying the small fine Health Insurance NEEDS young healthy people in order to avoid adverse selection and maintain health insurance costs.

Adding More Insured People Could Cause Long Waiting Times •Healthcare Reform expected to insure 32 more million people •Doctor shortage leading to longer waiting times •American Academy of Family Physicians predicted a shortfall of 40.000 primary care doctors In Massachusetts. ©Copyright Medical Tourism Association™ . the wait to see a primary care physician increased from 33 days to 52 days. after the passage of Romneycare.

Other Reform Elements that Drive Up Health Insurance Costs •Dependents . there is a cost to this… •Insurers need to spend no less than 85 percent of money from enrollees on medical costs. that figure is 80 percent ©Copyright Medical Tourism Association™ .allows young adults to remain on their parents' health insurance plans up to age 26 •Elimination of lifetime caps/limits (before this was capped depending on the plan at between typically $500. in the individual market.000 per individual).000 up to $5.000.

In the individual market. This means insurers can only charge 15% for administrative costs and profit for group/employer business and 20% on individual. Because of this insurance agents commissions have pretty much been eliminated. Cutting out insurance agents main source of revenue in the U. Agents ARE looking for alternative revenue streams and medical tourism can help…. that figure is 80 percent.Mandates Loss Ratios for Insurance Companies Insurers need to spend no less than 85 percent of money from enrollees on medical costs.S. ©Copyright Medical Tourism Association™ .

•Employers may push full time employees to part time.000 fine. Many employers have already shifted to this model. hourly or 1099 to eliminate having to provide coverage. more uninsured or underinsured. ©Copyright Medical Tourism Association™ . and it is easier to just budget going forward with a $2.•Employers who have more than 50 full time employees will be fined up to $2.000 per employee per year in the future. and they know healthcare reform will drive up costs.000 if they do not provide insurance starting in 2014 •There are growing numbers of employers who are considering or planning to cancel employer sponsored health insurance and pay the $2. This means Healthcare Reform doesn't necessarily mean more people insured. that means they know they could be spending $7.  Means Americans with no health insurance coverage. Why? IF they are paying 100% of employee coverage now.000 fine per employee.000 to $12.

S. ©Copyright Medical Tourism Association™ .•No Tort Reform – Medical Malpractice . many doctors will likely decide to reduce their patient loads or retire.Gallup Poll found that nine in 10 doctors admit having practiced defensive medicine at some time during their career – which increases the cost of healthcare in the U. and no tort reform was passed •A survey in the New England Journal of Medicine reports that 46 percent of doctors may give up their practice in the wake of this bill While that is probably exaggerated.

S. already have financial challenges. Hospitals in the U. If they receive reduced prices from Federal Government.7 billion over 10 years for Medicare and Medicaid.  Charging employers and insurers more for care. this means they need to make up the loss elsewhere.Problems with Medicaid and Medicare Future Problems – Reduces hospital payments by possibly $102. ©Copyright Medical Tourism Association™ .

S.S.S. •Most patients coming into the U. These payers will continue to send patients to the U. •No Real Effect.S.They are coming to go to highly specialized hospitals for high quality healthcare •Inbound medical tourism has been growing to the U. as their treatment option ©Copyright Medical Tourism Association™ .S. are either foreign patients who are cash paying or covered by a private insurer or foreign government.How Does Healthcare Reform Affect Inbound Medical Tourism into the U. and will continue to grow due to the increased demand and purchasing of global health insurance policies by foreigners who then choose the U.

How Does Healthcare Reform Affect Domestic Medical Tourism within the U. I was steering members since early 2000’s when working for a national third party administrator. we called it “Steerage” then ©Copyright Medical Tourism Association™ . this segment of the industry will continue to grow •Note – Not a new industry.S. employers are looking for innovative options •Domestic medical tourism operates under two models • High quality at much more affordable rates •High quality at fixed. bundled packages • For Employers looking for creative domestic options. • Positive effect on the growth of domestic medical tourism •With increased costs.

S.S. insurers and employers have no choice but to look very hard at implementing medical tourism as otherwise costs are unaffordable. already can’t afford current insurance premium levels •Medical tourism may be one of the few way for insurers.S. Healthcare Crisis •Medical Tourism Healthcare Reform White Paper – Released today on MTA’s website. insurers and patients in the U. employers and healthcare consumers to save significantly on medical tourism costs •U. 20 Page White Paper on Healthcare Reform’s Effect on Medical Tourism at www.MedicalTourismAssociation. as other hopes.S.In Conclusion •Healthcare Reform will significantly increase health insurance costs in the U. •Employers. such as consumer driven health plans over the past few years have shown they are not going to solve the ©Copyright Medical Tourism Association™ .

Insurers and Buyers of Healthcare and other interested parties may join the coalition. by ensuring they receive access to quality healthcare from foreign hospitals and doctors. Foreign Governments.US Medical Tourism Lobbying Group • International Healthcare Consumers Coalition •Launched Summer of 2012 •In application process for 501c(4) Lobbying Group • Lobbying Group to Lobby US Congress for Medicare Reimbursement Overseas •“This new coalition serves to help protect Americans. while living or traveling abroad. •For More information on the coalition you can contact Renee-Marie Stephano at ©Copyright Medical Tourism Association™ .” •Hospitals. Healthcare Providers.

com ©Copyright Medical Tourism Association™ 2012 2012 .No Reproduction without Permission .MedicalTourismCongress.• • • • • • • Healthcare Reform focus – With speakers Healthcare Reform Certification Course for medical tourism attendees Ministerial Summit Medical Directors Summit Buyer of Healthcare Executive Summits Network with global buyers of healthcare Learn from case studies www.