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Unconventional Medical Tourism

Mark Twain is credited with saying, “Everybody complains about the weather but nobody does anything about it.”   This is an apt metaphor for the American health care system.  Everyone complains about its cost and bureaucracy, but no one does anything about it (and those who do attempt to do something about it generally just make it worse — yes, that means you, President Obama.)

The fact is, there is very little any of us can do as individual consumers of health care.  Costs are kept elevated by forces beyond our control.  We can “self ration” (i.e. forgo some non-critical medical procedures),  but at the end of the day we have very little bargaining power, either with the insurance companies or with the doctors and hospitals, for the services we need.

So what is a cash-strapped patient to do?  In a word, leave.

I’ve written about medical tourism before (see “Other Views on Health Care“) and have used it myself for various minor procedures when it was convenient.  But I recently had a much larger use for medical tourism (around 8 pounds, in fact).

Last March, we discovered that my wife was pregnant.  We also discovered — to our horror — that our health insurance policy did not cover maternity (As it turned out, that is a separate policy.  Who knew.)

Readers with young children are probably aware that the costs for the birth of a child can easily exceed $20,000 in the United States. I find it amazing that a basic human function (I don’t even consider it a medical procedure, as it is a basic, natural function of the human body that homo sapiens have been doing for millennia) costs more and more every year to perform.  This isn’t cutting-edge, experimental surgery; it’s childbirth.  It should get cheaper every year, not more expensive.  But, alas, we do not get to choose the prices that we pay.  Or do we?

We decided that losing the cost of a new car to the hospital bureaucracy was a nonstarter.  So, we took the unconventional route.

My wife is originally from Peru, and her family still lives there.  She also has several friends in Peru who have recently had babies.  So, the decision was a no-brainer.   My wife spent the last trimester in Trujillo, Peru, from where I am writing this blog post (the benefit of the information age — I can effectively work from anywhere in the world, at least for short stretches of time).  We hired the best doctor in the city, and reserved her a suite in the best maternity hospital.

The total cost?  Less that $1,000.  Cash.  No cumbersome insurance forms or bills in the mail six months later.  And that included the additional costs of a cesarean section.

For Americans wondering about citizenship/residency issues, this too is relatively easy if at least one parent is a US citizen.  Last week, we made a trip to the US embassy in Lima to obtain the baby’s citizenship documents and passport.  The little guy is not even a month old, and he’s already a dual citizen.

Obviously, the medical tourism route is not appropriate for all Americans expecting children.  Most Americans do not happen to have Peruvian in-laws like I do.  However, with medical costs continuing to spiral out of control (and with ObamaCare, if it passes, only likely to make the situation worse), I’d expect an increasing number of Americans to opt for the medical tourism route for just about every other procedure under the sun.

Charles Sizemore, CFA
Co-author of the recently-published Boom or Bust: Understanding and Profiting from a Changing Consumer Economy …and recently a dad.