Term Paper on "Globalization and American Health"

Term Paper 15 pages (4608 words) Sources: 15

[EXCERPT] . . . .

S. But available elsewhere also prompts people to seek treatment abroad. One such treatment is the orthopedic procedure known as hip resurfacing, that is an alternative to the traditional hip replacement as done in the United States. Thus those suffering chronic pain, are treated in India, "where hip resurfacing techniques, materials, and instrumentation have been perfected, and the procedure is routine." (Edelheit, 2007)

There are lesser waiting periods abroad and those who are subscribers of free health care have to wait for very prolonged periods to be treated and such persons like those covered by the 'Veterans Administration Act' chose to pay out of pocket to beat the uncertainty of waiting. These are the types of patients who seek relief outside the U.S. But the story of the patients seeking the outside treatment may not be limited to these types of patients and there are more willing people who would go abroad.

3. Are there other patient segments beside these five?

There are problems caused by insurance companies and the way the patients are shifted from care to the outpatient that causes discomfort and a feeling of inadequacy. Therefore patients who may not find traveling abroad lucrative still do so because of the care factor. The problem is with the U.S. health insurance companies who want to have patients 'processed' fast. And this has made the outpatient procedures attractive and thus the inpatients are sent out of those costly beds as soon as possible. Thus the care and treatment given to genuine ailing patients abroad is attractive. This can then include the patients who look for better and concerned care and comfort who wish to go abroad rather than be treated as 'outpatients'. (Edelheit, 2007)

Other types of patients who go abroad may be those who are adventurous, and seek the 'new' and thus find relief from the local facilities which to them are dull. They may be also intrigued by the new culture which can mollify their conditions in the stressful time. There are experiences that also add to the treatment. American patients going abroad thus ranged from 500,000 to 750,000 by 2007. The survey of the McKinsey and Company showed that more than 40% of went abroad to seek alternate and advanced technology, and more than 32% went because of the better healthcare provided. There was also the consideration of the speed with which the care is given and only in nine percent of cases are costs an important fact. (Health Tourism, 2011)

Thus the major cause of the medical travel is the non-availability of health insurance which has made 1.2 million patients to go to Thailand. Seniors visit the nearby Mexico where the retired receive both nursing home and health care. There is a gain of over 25% to 75% in savings and the major groups choose to go abroad for dental, orthopedic, cardiovascular and cosmetic treatment. Of these Mexico and Costa Rica are famous for dental services and cosmetic surgeries while India is for the orthopedic and cardiovascular cases. (Health Tourism, 2011) These types of patients are in addition to the original five types who wish either to overcome the cost or go in for a change of scene and also afford better care at least cost. These are some of the major drawbacks of the American system that the health care sector has to address to overcome the outflow.

4. Why is there growing rivalry for inbound international patients?

The inbound health care patients are becoming rare. There is cheaper and quality health care available in other countries and more and more of people go overseas. There is inflow of patients for treatment in the U.S. For ailments which are very complicated and require sophisticated technology that is not found elsewhere. Such patients have also to be very affluent. These inbound patients are few and far and this prompts competition between hospitals to corner the patients. Further interstate rivalry -- attracting patients from other states in the U.S. is also an option that companies are now into. However the market is slow and less prone to increase in demand. (The Economist, 2008)

Cost factors therefore make hospitals vie with each other in specializations. Yet the patients do not come to these hospitals. One example is that of the American health tourist, Robin Steele. Mr. Steele who was operated at India's Wockhardt hospital after his treatment also enjoyed a holiday with a savings of several thousand dollars. This alien competition has now created a competition to private health care in America. While it began with the outsourcing of record-keeping and medical transcription, most American hospitals are cutting costs by outsourcing the customer service and claims-processing and major American hospitals like the Mayo Clinic and Johns Hopkins have overseas interests in the back office functions. (The Economist, 2008)

The problem is that while these functions make the overseas personnel efficient they also spawn heath care facilities to which the American is attracted owing to the low cost. This makes American hospitals go for product differentiation to attract the overseas and local clients to American hospitals. (The Economist, 2008) But the strategy has to work with barriers like costs of stay and other services, availability of suitable personnel at hospitals and so on. This makes the work difficult because the strategy must be effective two fold. First it must make the hospital attractive to the local user and Americans from other states. This creates internal competition and results in the rivalry to gain patients to maintain the internal clientele. (The Economist, 2008)

The second strategy involves the prevention of the would-be health tourist visiting a foreign country. Thus each hospital is trying to provide low cost and highly efficient service and compete with one another. It is predicted that in the future the mass transit of patients will begin from the U.S. If the health care industry is not revamped so as to make the health care a very affordable and socially possible system. This means that there will have to be restructuring of a lot of systems including health care delivery and also insurance. This is not in the domain of the hospitals alone. (The Economist, 2008)

It is predicted that somewhere in the near future the explosion of mass medical tourism will occur with the middle-class Americans now figured at 750,000 to increase to six million by 2010. This will make the American hospitals lose out because the European medical system is stable and is funded by the state while U.S. medical treatment is very costly prompting people to seek cheaper and easier locations abroad. (The Economist, 2008)

Some of the recent developments concerned are with the economic depression into which the economy has fallen and the problem of unemployment and unaffordablity that comes as a result especially for aging populations. As a rule, Americans do not choose going abroad for medical treatment. This is a result of the cost inflation and slowing economic growth, and it has already become the most expensive health market in the world. The quality of the hospitals abroad is quite equal to the ones in the U.S. And the insurance systems are better abroad. The trend has caught on with the companies in America feeling that it is a great idea to send employees overseas for treatment. (The Economist, 2008)

Today many companies are prepared to create packages for the employees that provide for insurance benefits and other cost benefits for taking treatments in other places as a perk. There are many companies today that have taken to this and this is also causing a fall in demand for American health services. The examples of companies sponsoring their employees for medical travel can be seen in the case of "Hannaford, a grocery chain based in New England, now offers its 27,000 employees the option of getting a number of medical procedures done in Singapore rather than America -- at a saving to the employee of $2,500-3,000 in co-payments and deductibles." (The Economist, 2008) When that is the case, American hospitals have to contend and fight each other to retain market share of inbound patients who may become extinct in a few years.

5. Under what conditions should a hospital invest in plant and equipment to attract international patients?

In the present scenario looking at overseas patients is the wrong approach. Hospitals must first fight the inadequacies and provide for cost effectiveness for the local clients such that they are not tempted to go abroad. One major problem that hospitals have to address is the issues that hamper the proper delivery of health care. Take for instance the Medicare. On one side we have the emerging skill and adaptation of technology by the medical fraternity and on the other hand is the competitive rise of insurance and other health benefits that are in the realm of finance and profit motive. Thus there is a great dependence between the care physicians and health plans which arise from pure networks.… READ MORE

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