PRESENTED BY

Terry W. WhiteMarch 12, 2009

What You should Know about Medical Travel

and

the Potential Impact on the Cost of Your Healthcare Benefits!

PresentationOverview

Problem: US Healthcare system

Economic impact

Major problems in the system

Single payer, gov’t. run systems

What will Obama do?

Growth in Medical Travel

Locations and Services

Could it be for you?

Stem Cells

How to Make it Available

Plan design

A variety of options

Perceived Barriers

Malpractice

Follow-up care

Quality

Problem: The US Healthcare

System

Cost!

Problem: The US Healthcare

System

•Cost

•Leads to uninsured (50 Million Americans)

Problem: The US Healthcare

System

•Cost

•Leads to uninsured (50 Million Americans)

•Restricted access/limited benefits

The Economic Impact

•Eroding Competiveness Worldwide

•Lower Wages

•Higher Taxes (Medicare and Medicaid)

•People assume risk for catastrophic events—more bankruptcies

•Sense of waste leads to dissatisfaction and then Malpractice suites

Gov’t. Single Payor:

The solution?• Canadian Experience

– Long waits

– “Two Tiered” System: those who can travel to US

• European Experience

– Long waits

– Deferred care

– “Two Tiered” System: Travel within EU and/or Asia

The Obama Solution

•We don’t know what it will be yet: It will be very expensive!

•And can we afford it?

•Likely to be regulation oriented! That usually adds to the underlying costs!

Medical Travel History

How & Why did it begin?

Infusing Competition

Study & Survey ResponsesThe Acceptance

• 88% of surveyed participants would consider going out of their community for care and treatment if outcomes are better and cost no greater. - Deloitte Center for Health Solutions

• 50% of Americans say the cost of health care is their number one economic concern. - The Wall Street Journal, August 2, 2007

• 500,000 – 700,000 patients a year travel for care with savings on the order of $20

billion. -McKinsey Report 2008

• Cost Advantage for Medical Tourism is 28-88%. -Deloitte Center for Health Solutions

The Need• Since 2000, employment based health insurance premiums have increased 100%,

compared to cumulative inflation of 24% and cumulative wage growth of 21% during the same period. - Kaiser Family Foundation

• The current state of the world economies demands innovation and solutions.

When competition works

Two major competitive successes in US Healthcare:

•Lasik Surgery

–Extremely high quality, dropping prices

•Plastic Surgery

–High quality, very competitive prices

Benefits of Medical Travel

Significant Savings

High Quality

Transparent Costs

Complements Consumerism

Medical Travel challenges

Quality of institutions

After care coordination

Malpractice

Accreditation

• Joint Commission International, based in the U.S., is a division of Joint Commission Resources (JCR) and a subsidiary of the Joint Commission designed to improve and regulate the quality and safety of healthcare services.

• About 200 and growing

foreign hospitals now accredited

BridgeHealth International Centers of Excellence

Additional locations in Europe and elsewhere are under evaluation.

•Brazil

•China

•Costa Rica

•Hong Kong

•India

•Mexico

•New Zealand

•Puerto Rico

•Panama

•Singapore

•South Korea

•Taiwan

•Thailand

•Turkey

•U.S.

U.S. & International Locations

Medical & Dental Procedures

• Gastroenterology

• General Surgery

• Gynecology

• Infertility

• Internal Medicine

• Neurosurgery

• Oncology (selective)

• Ophthalmology

• Cardiology

• Cardiothoracic

• CyberKnife® (cancer)

• Dental

• Detox/Rehab

• ENT

• Executive Health Physicals

• Orthopedics

• Pain Management

• Pediatrics

• Plastic andReconstructive Surgery

• Urology Male/Female

• Vascular

• Weight Loss/Obesity Surgery

All-InclusiveTransparent Pricing Plan

Which Includes:

Surgery/procedure costs

Airfare

Lodging

Transfers

24/7 Concierge Service

Care CoordinationConsultation with Travel Care Coordinators

HIPAA compliant, including medical records

Coordination of pre-travel communications are made for client to host country hospital and physician

After care needs can be coordinated

Client outcomes are tracked and monitored

• Great facilities staffed by highly skilled physicians and support staff

• Many of the Physicians are trained in the West (US/Europe/Canada)

World-class Facilities

Singapore Turkey

IndiaThailand Mexico

Malpractice

•Jurisdiction in country of treatment

•Policy available for US adjudication

Malpractice

•Jurisdiction in country of treatment

•Policy available for US adjudication

•Customer service is extremely important in managing risk

Exciting New Services

•Stem Cell Therapies

•IVF

Also:

•Access to “uncovered” services at about 1/3 of the cost in the US

Three Program Cell Lines

1. Neurodegenerative

Stroke/Brain Trauma*

Spinal Cord

Alzheimer’s

2. Sight Restoration

Diabetic Retinopathy

Macular Degeneration*

3. Skin, Bone & Soft Tissue

Scars*

Burns

• Significant Efforts Underway To Establish Regulatory Pathway in US• Manufacturing sites presently in Moscow and San Diego

Bone

Ulcers

Stem Cell Treatment Locations

•China

•Russia

•Soon to be in Mexico and Bermuda

Insured: Will they travel?

30% of the insured US population under age 65 will travel internationally for a healthcare procedure if:

1. Quality is comparable

2. There is at least a $5000 benefit

Sample Estimated Costs of SurgeriesTypical US

Pricing

Domestic COE

Pricing

International

COE Pricing

Mitral Valve

Replacement

$119,000 $45,000 $10-30,000

Cardiac Bypass $100,000 $37,000 $8-30,000

Hip Replacement $50,000 $20,000 $7-14,000

Knee

Replacement

$45,000 $20,000 $7-14,000

Cholecystectomy $26,000 $10,000 $3-6,000

Note: These prices are inclusive of Hospital, Surgeon, Lab, Radiology, Anesthesiology, etc.

Prices will vary by location, severity, co-morbidity and are approximate for comparative illustration.

COE examples do not include travel costs, but the savings more than offsets them.

Example: Decision for Hip Replacement

Hospital A Hospital B Hospital C Local US Hospital

Underlying Cost of Procedure, including Airfare and Hotel

$25,000 $15,000 $12,000 $50,000

Complication Rate for Procedure 0.5% 1.8% 1.1% 1.2%

Travel time from home (showing flight transfers required.)

4 hrs (0) 22 hrs (2) 30 hrs (1) 0.5 hrs (0)

Patient Satisfaction Score (5 point scale) 4.5 4.1 4.9 4.7

Impact to Employee*

Patient co-payment and deductible $500 Waived Waived $5000

Incentive paid by ER by EE $0 $1500 $3000 $0

Net benefit to employeewith variable incentive

$4500 $6500 $8000 -$5000

Assumes a $5000 copay/coinsurance at a US hospital and a variable incentive paid by employer (ER) to employee (EE) based on provider selected.

Sample Benefit Design & Savings

HYPOTHETICAL COMPANY EXAMPLE:CURRENT INT’L INNINN BENEFIT

SAVINGS to Employer* 0 $38,000

DEDUCTIBLE $1,000 WAIVED

COINSURANCE 80/20 WAIVED

MAX. OUT OF POCKET $5,000 WAIVED

ADD’L BENEFITS:

TRAVEL INCENTIVE N/A $3,000

Travel costs, air & hotel N/A $4,000

Partner air N/A $2,000

* Hip replacement done in Asia: U.S. cost ~ $50k, Int’l cost ~$9,000Cost to the Employer: $14,000 ($5k OOP, + $9k incentives & costs)

Net Savings to Employer: $29,000.

A Domestic Network would yield savings in between.

Who is interested

Brokers & Consultants

Insurance Companies

Union trust funds

ASOs

Self-insured companies

TPAs

Reinsurers

Individuals

Ideal forSelf Insured Plans

Fully Insured for uncovered benefits

Dental Care

Cosmetic

Bariatric Surgery

Infertility

Limited Benefit Plans

Procedures not available in U.S - Stem Cell

Timely access to care - Canada & UK wait times

The American healthcare system has become so

expensive that companies are dropping coverage.

Healthcare is virtually unaffordable for those

without insurance.

American businesses are increasingly unable to

compete in a global marketplace due to high costs

of health insurance.

The declining current world economies

Opportunity

• Reduce corporate costs

• Reduce employee costs

• Sustain or increase benefits

• Offer a new innovative service

• More U.S. competition & transparency

Medical Travel Forecast

Discussion

The Trusted Bridge to World-Class Healthcare™

Contact Information

Terry W. White, PresidentTWhite@BridgeHealthInternational.com

O: 303.457.5724

C: 303.887.1209

www.BridgeHealthInternational.comThe Trusted Bridge to World-Class Healthcare