Search Medical Centers

Medical Travelers and the American Healthcare System – A Cost Effective Solution

Nowadays, patients are traveling around the globe to receive medical treatment. Some medical travelers are seeking better care, others are bypassing wait lines. The most commonly known reason is that patients are seeking affordable prices. According to the 2013 Health and Voluntary Workplace Benefits Survey:
  • 55% of Americans gave a low rating to the healthcare system1.
  • 72% do not feel confident regarding their ability to get needed treatments in the next 10 years1.
  • The primary cause of dissatisfaction among Americans with the healthcare system is due to the increasing healthcare costs1.

Currently medical travelers are seeking treatments that are not covered by insurance or are simply too expensive such as dental care and cosmetic surgery2a. Medical tourism may offer a feasible alternative to the existing system. even with the changes that have been implemented with the Patient Protection and Affordable Care Act of 2010 (PPACA).

Overview of the Current Healthcare System in America

The current American healthcare system is made up of both private and public insurers. What is unique about the US system is that the private element dominates the public2.

Public Health Insurance Companies

These insurance companies are owned by the government. For the most part, they cover seniors, the disabled, children from low income households, very poor parents, pregnant women, and veterans. According to federal law, the states are required to cover these groups2. Often people insured with public healthcare have to purchase supplemental insurance because of2,2a:
  • Incomplete coverage
  • No dental care
  • No hearing care
  • No vision care
  • Difficult to find providers that accept insurance with low reimbursement rates

Private Health Insurance Companies

The current private insurance system offers most citizens low quality care at a high cost. This may be attributed to the lack of competition in conjunction with the fact that medical insurance companies predetermine what procedures they cover and the cost of each treatment. As a result, the quality of care is based on a patient’s level of financial coverage and the amount of money the doctor will receive for the treatment3.The following examples and statistics are factors that contribute to the high costs of healthcare available in the U.S.:
  • Price and service are not sensibly packaged resulting in higher costs and lower quality4.
  • Healthcare is fragmented among specialties and different providers, and communication among providers treating the same patient is often nonexistent.
    • According to the Health Insurance Portability and Accountability Act (HIPAA) privacy regulations, it is illegal for providers treating the same patient to discuss a patient’s condition without expressly given patient consent3.
  • Out-of-pocket expenses are increasing each year. In 2003, 43.1% of Americans under age 65 spent over $2000/year in out-of-pocket health care costs, including that of health insurance5.
  • Wasteful spending of increased healthcare budgets. Inefficiencies, excessive administrative expenses, inflated prices, poor management, and inappropriate care, waste and fraud significantly increase the cost of medical care and health insurance for employers, workers and families6.
    • A report published in 2007, found that the United States spends in excess of $480 billion each year in comparison to Western European nations that have universal health insurance coverage. The costs are mainly associated with excess administrative costs and a lower quality of care7.
  • In the US, only 1 in 4 hospitals have electronic medical record systems (EMR) and less than one-in-five physicians use such systems despite its capacity to decrease medical errors and improve the quality of care provided8.

Medical Tourism as a Feasible Solution

Since so many patients are required to pay out-of-pocket expenses in addition to health insurance costs, it is becoming increasingly popular for U.S. patients to travel abroad for surgery and other medical treatments3. Treatment centers abroad typically offer low priced packages which include the following:
  • Cost of the full treatment.
  • Physician, hospital and administration fees.
  • High quality of care.
  • Facilities and physicians that meet American standards.
  • The use of electronic medical records and other advanced technologies for patient security and safety.
  • Lodging and airfare are often included.
Altogether, including the cost of travel & lodging, treatment can cost as low as one-fifth to one-third of what it would cost in the United States9. Additionally, high quality care using state-of-the-art medical technology is emphasized. Most of the American patients traveling abroad for surgery are uninsured or underinsured9. Since these costs are coming out of their pocket and to avoid paying high costs for low quality treatment, more and more patients are turning to this affordable alternative when it comes to medical treatment.
Benefits of medical tourism are not just limited to patients:
  • Many insurance companies have started covering medical tourism as a part of their healthcare package10.
  • Several Fortune 500 employers are using medical travel to help stem the rising cost of employer-provided medical coverage10.
  • A report by the International Foundation of Employee Benefit Plans found that 11% of employer health plans surveyed now cover medical travel10.


The existing medical system requires patients and employers to pay high prices for fragmented and low quality treatment. Both patients and employees are turning to medical tourism as a feasible option to receive quality care at an affordable price.


1. Health and Voluntary Workplace Benefits Survey – 2013 Results, Employee Benefit Research Institute, 2013 ,September 2013, Vol. 34, No. 09. (

2a. "Obamacare isn’t good for your teeth," Market Watch, Elizabeth O'Brien, January 24, 2014

2.Kao-Ping Chua, AMSA Jack Rutledge Fellow 2005-2006: Overview of the U.S. Health Care System, February 10, 2006

3. The Market for Medical Care: Why You Don’t Know the Price; Why You Don’t Know about Quality; And What Can Be Done about It.NCPA Policy Report No. 296 (ISBN #1-56808-169-3), February 2007 (

4. Michael E. Porter and Elizabeth Olmsted Teisberg, Redefining Health Care: Creating Value-Based Competition on Results (Boston, Mass.: Harvard Business School Press, 2006).

5. Agency for Healthcare Research and Quality. Out-of-Pocket Expenditures on Health Care and Insurance Premiums Among the Non-elderly Population, 2003, March 2006. (

6. The National Coalition on Health Care. Facts on the Cost of Health Insurance and Health Care. 2009 (

7. McKinsey Global Institute. Accounting for the Cost in the United States. January 2007

8. Catharine W. Burt and Jane E. Sisk, “Which Physicians and Practices Are Using Electronic Medical Records?” Health Affairs, Vol. 24, No. 5, September/October 2005, pages 1,334-43.

9. Mercer Health & Benefits predicts this will be the case. See Judy Foreman, “Bon Voyage, and Get Well!” Boston Globe, October 2, 2006.

10. Medical Tourism: Health Care Free Trade. Devon Herrick, NCPA Policy Report No. 623, 2008 (

Copyright © 2008 - 2024, All Rights Reserved