Monday, September 14, 2009

Medicare in Mexico?

Last March Rocky Point Tides published an article about Hospital Cima Hermosillo, a world-class hospital owned by Dallas-based International Hospital Corp. (IHC), signing a contract with Companion Global Healthcare Inc. to be included in its network, making it possible for Blue Cross and Blue Shield members to seek treatment there. (See Medical Tourism in Mexico and American Insurance Companies) Procedures covered include cardiology, gynecology and orthopedic surgeries, and there are no deductibles to pay. Members now have access to the hospital's 60% discount of what the U.S. price is.

At about the same time that article was written, Paul Crist, a former aid to Sen. Paul Sarbanes, D-Md. who now operates a hotel in Puerto Vallarta, founded the non-profit Americans For Medicare In Mexico (AMMAC). He has since lobbied 85 members in the U.S. Congress to get Medicare accepted south of the border, and his efforts seem to be gaining some traction.

Approximately 800,000 Americans live in Mexico, with about a quarter of them over the age of 60, which makes them eligible for Medicare. Studies show that about 64% of them currently have to fly or drive back to the USA for care that is covered by Medicare; the remaining 36% receive treatment in Mexico and pick up the costs themselves. Crist postulates that if Medicare were accepted in Mexico, most of the 64% flying back to the USA would instead opt for treatment nearer their homes, cutting Medicare's overall costs by a minimum of 22% net.

Studies show that medical care in Mexico costs about 70% less than the same care in the USA. With the Baby Boomer generation rapidly entering retirement age, the savings to Medicare from Boomers choosing to move to Mexico, or receive medical care there, could be even more substantial within the next few decades.

AMMAC and David Warner, a professor of health care policy at the University of Texas at Austin and a specialist on Medicare in Mexico, are both proposing an in-depth three-year Mexico-Medicare pilot project to better understand the economics, determine whether Mexican health care meets Medicare's quality standards and determine if the payment system is sufficiently free of fraud. To that point, they are seeking U.S. Congressional authorization for a Demonstration Project for Medicare in Mexico.

On the Mexican side of the border support for such a program is generally viewed favorably. With an eye toward encouraging the growth of Medical Tourism, Mexico is already in the process of bringing private hospitals up to the standards required for certification by the Joint Commission International (JCI), an institution that accredits hospitals in Canada and the United States.

What many people don't know is that the North American Free Trade Agreement obligates the Mexican medical system to be on a par with the United States and Canada, allowing for the free flow of patients from border to border. The health sector in Mexico is regulated and certified by the Mexican General Health Commission, and health care is quite good throughout the country, but Mexico sees the task of getting JCI certification for its private hospitals as very important to complete its obligations and fulfill its hopes for the future of Medical Tourism.

According to Crist, Mexican hospital accreditation standards match JCI’s requirements in almost every respect. His organization is asking that Medicare do their studies to accept Mexican accreditation instead of the JCI accreditation, which would open the door for many hospitals available as Medicare providers.

While support for Crist's proposal is substantial, especially in the House of Representatives, he is being told that now may not be the best time to introduce it. Their plate is pretty full right now, especially with the Health Care Reform debate going on, and many Congressmen/women think it might be a wiser political choice to wait until next year and introduce a separate bill proposing Medicare in Mexico rather than trying to include it in the Health Care Reform bill now being debated.

Keeping a close eye on the subject, and backing it, are real estate developers hoping to build assisted-living villages for American retirees in Mexico and influential lobbying groups like the Association of Americans Resident Overseas. And then there's Carlos Slim Helu, one of the richest men in the world.

Carlos Slim's Ideal company has already formed a partnership with Grupo Star Medica to open new medical centers in Puerto Peñasco and Los Cabos catering specifically to U.S. Baby Boomers. Slim, who owns Telefonos de Mexico among other companies, said at the time that the sharply increased costs of health care in the United States, much of it borne by the federal government in Medicare costs, presents an opportunity for Mexico to become a place where retirees can come to get medical care at a much lower cost. He reckoned that fulfilling that opportunity would require getting Medicare/Medicaid to cover medical procedures done in Mexico.

Americans in Mexico will have to wait and see how it all works out, but in the meantime the Association of Americans Resident Overseas and similar organizations are asking members to send letters to their congressional representatives, urging that at minimum a pilot project like that suggested by AMMAC and Warner be undertaken to study the consequences of accepting Medicare benefits in Mexico.

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