11.20.07
Medical Tourism
Recently it came to my attention that there the terrible and growing problems with the private healthcare the in the United States are finally reaching the breaking point. If you need more proof in this all you need to do is look at the growing industry of medical tourism.
Medical tourism is mostly indulged by members of the middle class; those people, especially amongst the self-employed, who cannot reasonably afford health insurance. Premiums are getting increasingly expensive, and trying to afford preventative care without it is usually unreasonable. In order to deal with the outrageous costs of medical care, a lot of people are now leaving America for exotic destinations like Thailand, India, Mexico, and China. In these countries, it is possible to get top of the line medical services for a fraction of the costs that you would face in the United States.
Of course, this is just a symptom of a wide ranging set of problems in the United States. The private insurance system is a bloated and inefficient machine that forces both huge administrative overheads, massive premiums for doctors and patients, and overpriced and redundant diagnostic techniques. Furthermore, the industry is supported by massive government subsidies, which demonstrate the overall unsustainable nature of the entire private system.
Nevertheless, medical tourism has potentially wide-ranging effects in the American domestic market as well. When more and more people start heading abroad, doctors and nurses in the states will find themselves increasingly outsourced - just the latest in a long string of tragedies from poor economic management in the United States. Moreover, the grotesquely inflated price ceilings in US hospitals require constant influxes of money and resources. If these margins should suddenly fall, the fallout would likely lead to a severe shrinkage of the medical infrastructure in the US, but is unlikely to lead to a real depression of prices, since the government would be forced to prop the older system up to prevent a total collapse.
The outsourcing of American medical needs will also have serious ramifications in the developing countries that receive rich western patients. The sudden influx of western money will like have the effects of pushing the prices of medical care up overseas. The immediate logic is to go get your liposuction now, but moreover to be warned that if the premiums overseas rise too much, then medical care will be increasingly difficult to afford for the natives of those countries. The political ramifications for this are potentially very serious, but given the level of government regulation in the rest of the world’s health care systems, the prices will likely be kept to reasonable levels, with certain liberties and taxes being placed on western medical tourists to help pay for the costs of keeping medical talent.
Of course, we could just deal with the situation as it is, let the problem grow until such time as the system collapses and forces us to adopt a new model. It would be very difficult, and bring about an accelerated growth in inequality and further limit the upward mobility of middle and lower class Americans. This is the most likely outcome unless the lawmakers in the United States are will to admit that the medical system needs to be severely reigned in. When even the relatively well-to-do are forced to leave the country to receive critical medical care, there is a serious problem. This isn’t simply a matter of supporting private medical insurance companies (I fail to see any meaningful difference between this and a state-control enterprise), but actually earnestly streamlining and reforming America’s heath care system. This means dismantling lobbying organizations, likely forcing doctors to take paycuts (though reducing the role of insurance companies would likely decrease the costs associated with working in the medical industry in the US and offset many changes to the market for doctors), and disrupting the simply massive medical bureaucracy that also adds huge costs to the spiraling prices of medical care in the US.
There are ways to make things better for the American people, even if it hurts vested interests of the insurance firms. Sometimes you need to realize that existing models simply aren’t performing, and when you need to take a vacation to Bangkok to get treatment, there is a bigger problem at hand.