A Thai Remedy for High Health Costs

BANGKOK The crisis in American health care is turning into very good news for Bumrungrad Hospital.

Bumrungrad treated more than 350,000 international patients last year, up from 161,000 in 2000. This year it expects to treat more than 400,000.

"We have gone from a 200-bed hospital serving a local community to a health care brand that is globally recognized," said Bumrungrad's marketing director, Ruben Toral. Its crosstown rival, Bangkok Hospital, the flagship of the Dusit Medical Group, treated 65,000 international patients last year and expects over 100,000 in 2005.

Both have moved from catering to expatriate staff members of international companies working in Asia, and in recent years they have tapped a large and growing pool of well-to-do patients from Arab and Asian countries seeking affordable, quality healthcare.

The difficulty, for citizens of many Middle East countries, of getting U.S. visas since the terrorist attacks of Sept. 11, 2001, has helped Bumrungrad - a for-profit institution that is accredited in the United States - and its rivals in countries like India and Hungary to enjoy phenomenal growth. In 2000, Bumrungrad treated 4,000 patients from the Middle East. This year it says it is averaging 5,000 a month.

Now, in the latest twist, the two Thai hospitals are opening their doors to patients who are willing to travel from the United States and Europe to escape high costs or long waiting lists - and looking beyond the estimated 40 million people in the United States who are uninsured or underinsured to U.S. employers burdened with rising insurance costs.

"American companies have outsourced just about everything else but never thought of outsourcing medical care," said Curtis Schroeder, Bumrungrad's chief executive. "Now they are."

The experience of June Flowers, of Huron, South Dakota, illustrates some of the financial advantages. Years of pain, misery and expense from a herniated disc finally drove the uninsured school worker to consult a doctor about surgery. His fee would have come to $30,000, she learned, with total costs over $40,000. "When he told me that I just came home and cried," she said.

After watching a report about Bumrungrad on the CBS News program "60 Minutes," she contacted the hospital by e-mail. Flowers, who had never before set foot outside the United States, flew around the world to Thailand last month. Two days after arriving in Bangkok she successfully underwent spinal surgery. A week later she was home. The total cost of her travel and treatment, complete with a private hospital room: $6,403.76.

Flowers was not the only person impressed by the "60 Minutes" report. Within 24 hours of the broadcast, the hospital received more than 3,000 e-mail inquiries from Americans. Some do not wait for appointments. "It's crazy; people are just showing up," Toral said.

The more serious and complex the procedure, the bigger the financial savings for individuals, employers and insurance companies, says Ralf Krewer, marketing director at Bangkok Hospital, where a heart bypass operation costs $9,000 compared with $40,000 or more in the United States.

Bumrungrad and United Group Programs in Boca Raton, Florida, which began offering inexpensive health insurance plans to low-income Americans three years ago, are currently negotiating terms under which United Group plans to offer its U.S. customers the option of treatment at Bumrungrad.

"Costs continue to increase, and more and more employers can't afford health insurance," John Edelheit, United Group's vice president of sales, said by telephone from Florida. "The only option that's out there is if we go ahead and outsource the expensive procedures overseas."

The hospitals also hope to benefit from Europeans' fleeing long waiting lists in their national health systems for treatment with a quality of service that only well-to-do patients can experience at home - with the possibility of an exotic vacation to boot. Bangkok Hospital has started to receive patients from Europe under insurance policies with BUPA International, Krewer said.

The surging demand for Thai hospital services rescued Bumrungrad and Dusit Medical Group, a rival with 12 hospitals in Thailand, from the Asian financial crisis in 1997-98 and turned them into thriving enterprises investing heavily at home and increasingly overseas.

Bumrungrad's net earnings last year rose 23 percent to 934 million baht, or $22 million. In the past year, while the Thai stock market index dropped 2 percent, Bumrungrad's shares moved up 39 percent and Dusit Medical Group's shares rose 55 percent, said Andrew Stotz, head of research at Macquarie Research in Bangkok.

"They've been a smashing success," Stotz said. "A lot of people have made a lot of money."

Nonetheless, Mohit Ghose, public affairs director of America's Health Insurance Plans, or AHIP, a U.S. insurance trade group, said that there were practical hurdles to be cleared before American insurers begin sending customers for treatment overseas in large numbers. In addition to any quality and safety concerns, he said, there could be tricky legal issues, such as cases of malpractice being prosecuted across international borders.

But considering the economics, he said, "it's not surprising that people are talking about it."

As to the quality concerns, Bumrungrad boasts more than 700 doctors, one-third of whom are U.S. certified, state of the art equipment, and - thanks to lower labor costs - a level of staffing that is unavailable in most developed countries. Patients are coming to what is in effect an American hospital in Bangkok, Toral said. "That's an important point for insurance companies," he said.

Quality issues actually argue in favor of Bumrungrad, says Edelheit, whose company is preparing a nationwide promotion to U.S. employers of a policy offering the option of treatment there.

David Shaw, an anesthesiologist of 20 years from Muncie, Indiana, agrees. He flew in for spinal surgery this week and is thinking of returning for other treatment.

"It's better than anything I've seen; it's a five-star hospital," Shaw said.

Meanwhile, to keep their edge in an increasingly global health care market, both companies are investing millions of dollars in new facilities in Thailand and overseas. Dusit Medical Group is investing in a hospital in southern China.

Bumrungrad is managing new private hospitals in Bangladesh and Myanmar, and this year it acquired a 39 percent stake in Manila's Asian Hospital. It also is taking a 49 percent share in a $40 million health care complex in Dubai, which is intended to become a medical hub for the Middle East and North Africa.

"At a certain point, people aren't going to come here to Bumrungrad in Thailand," Toral said. "They will want different options, and that's what we're creating."