Three Forecasts on Global Healthcare
The spotlight on global healthcare is getting brighter, with two new research reports making headlines last week and popular magazines promoting medical travel to consumers. First, a McKinsey & Company report states that with 60,000 to 85,000 inpatient medical travelers a year, the global healthcare market isn’t as big as individual hospitals and countries have claimed. Then a report came out saying that Deloitte LLP predicts Americans will spend $68 billion annually to non-U.S. healthcare providers by 2010.
Despite the fact that these reports seemingly conflict, medical travel has never had so much attention. In fact, within the past month feature stories about medical travel appeared in Fast Company and U.S. News & World Report—I wonder how long it will be before the weekly news magazine extends its annual “Best Hospitals” ranking beyond the U.S.
With such high interest—and equally high confusion—over the future of global healthcare, there is no shortage of industry insiders forecasting future developments for this in-flux and far-reaching market. Here are three predictions that I heard at last week’s Health Care Globalization Summit:
1. Relationship building: The established global systems are focusing a lot of attention on constructing formal relationships with U.S. health providers. They envision global networks that will provide consumers with the pre- and post-procedure care that is currently a barrier to accessing global hospitals. One might think that U.S. providers would not be receptive to these arrangements, but healthcare executives in Asia and India are optimistic that consumer demand will push these relationships ahead quickly.
2. Payers participation: Consumer and employer demand will also dramatically increase the number of global hospitals in U.S. payer networks, say global hospital executives. While analysts say the success of medical travel hinges on whether Americans access international services—McKinsey & Co. says this is the biggest growth potential—at least one large health plan executive shot down the idea that U.S. payers would greatly expand their international networks. He says there just isn’t enough incentive, but hospital executives disagreed, many expecting to see significant expansion within the next three years.
3. Better quality, lower costs: As global hospitals continually improve quality standards and more and more become JCI accredited, more U.S. consumers who are uninsured, under-insured, or in consumer-directed plans seek out the best value in the global market. At the same time hospitals in developing countries will not see significant price increases because native consumers will keep costs in check. A few industry experts even went so far as to say this will directly influence the cost structures of the U.S. healthcare industry and result in reforms.
I will be sure to explore these topics in detail in upcoming columns. Taken at face value, I remind myself to consider the sources of these predictions, which I suspect might be overly optimistic. At the conference, I had a chance to sit down with Dan Snyder, group executive vice president and group chief operating officer for ParkwayHealth, about his plans for Parkway and thoughts on the direction of the industry. Next week, I will share the highlights from that interview on HealthLeaders Media Global.
Rick Johnson is senior online editor of HealthLeaders Media. He may be reached at firstname.lastname@example.org.
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