NCPA - National Center for Policy Analysis


June 2, 2009

The future of health care looks good, says John C. Goodman, president, CEO and Kellye Wright Fellow of the National Center for Policy Analysis.  Instead of continuing to rise at twice the rate of growth of income, health care spending will slow dramatically.  Future prices will actually be lower than they are today.  Providers will bundle their services into easily-understood packages with a single fee.  They will compete against each other on price and quality and the data will be transparent.  Health care will be provided in a free, competitive marketplace.  Third-party insurance will be relied upon only for rare, very expensive events.  Medical malpractice suits will be virtually unknown.

There is only one catch.  All this will happen outside the United States, says Goodman.

The National Center for Policy Analysis has written a good bit about medical tourism, the U.S. hospital reaction to medical tourism, and those shopping for health care, says Goodman; in fact, one could solve the vast majority of our health policy problems by simply crossing the border.  Consider a facility run by Grupo Hospitalario, a private hospital chain in Guatemala:

  • The CEO of the facility is Erick Herrera, a Cornell University MBA; most of the doctors who practice there are U.S. trained, and most are board certified.
  • They have all the latest equipment; and as far as I could tell they can do just about anything an American hospital can do.
  • Right now, only 10 percent of their patients are foreign and only 2 or 3 percent are American.

As the U.S. health care system becomes increasingly dysfunctional, a low-cost, high-quality alternative only a few hours away could emerge in a heartbeat, says Goodman.

For starters, says Goodman, the hospital he visited looks like a modern hotel -- with all the comfort and amenities.  And the price is right -- better, in fact, than a hotel. A private room is $55 a day.  A suite is $85.  And it comes with a TV, minibar, Internet hookup and 24-hour room service.

Almost all medical services cost a fraction of what they would in the United States, says Goodman:

  • Whereas U.S. MRI scans range, say, from $500 to $1,500, the Guatemalan equivalent costs $240 (daytime) or $100 (evening).
  • Gastric bypass surgery, a popular procedure for American patients, costs $8,000 in Guatemala, compared to $25,000 in the United States.

Source: John C. Goodman, "Avoiding Armageddon," National Center for Policy Analysis, June 1, 2009.

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