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Blue Cross and Blue ShieldFeatured Health
Business Daily Story January 7, 2009 WellPoint Is Latest Blues Plan to Invest in Medical Tourism Reprinted from The AIS Report on Blue Cross and Blue Shield Plans, a hard-hitting independent monthly newsletter on business strategies, products and markets, mergers and alliances, and financing of BC/BS plans. By Chris Meehan, Associate Editor, (cmeehan@aispub.com) WellPoint, Inc.'s decision in November to launch an international medical tourism pilot with Serigraph, Inc. reflects rising costs for domestic surgery and the potential for international medical centers to provide quality care at a lower cost. The giant Blues plan follows in the footsteps of other insurers, such as BlueCross BlueShield of South Carolina, which launched medical tourism subsidiary Companion Global Healthcare last year and is expanding the network to include more foreign destinations. WellPoint's pilot program, called the Global Health Care Partnership, will allow employees of Serigraph to access benefits for certain common elective procedures at designated facilities in India starting in January 2009. Serigraph, a Wisconsin-based printing company, has 650 U.S. employees. The procedures include major joint replacement and upper and lower spinal fusion. "The U.S. retail price for knee replacement surgery is approximately $70,000, while the same procedure costs approximately $8,500 in India," says Razia Hashmi, M.D., chief medical officer for WellPoint's national accounts. Hashmi tells The AIS Report that WellPoint is still finalizing details of the overseas medical benefit. "However, all travel arrangements will be booked and paid for, for both the patient and a travel companion, and all related medical-tourism charges…[including both travel and medical expenses] will be billed back to Serigraph." He adds that WellPoint will assign a case manager to each member who decides to use the overseas network. That manager will coordinate all medical and travel arrangements for both the patient and a companion, and make arrangements for any necessary post-operative care after the member returns to the U.S. The overseas medical network includes Apollo Health System hospitals in Bangalore and New Delhi. WellPoint selected India, Hashmi says, because it has a high-quality, low-cost health care infrastructure, with health systems accredited by Joint Commission International that are members of the BlueCard Worldwide network. In addition, Serigraph operates a facility in India. "We are also exploring further expansion to include other countries," Hashmi says. The Global Health Care Partnership provides members with access to benefits, but offers no incentives to encourage utilization, Hashmi says. He notes that an "employer may choose to implement its own incentive program for members to receive care at various domestic or international providers." WellPoint designed the product to be flexible in order to meet the needs of self-funded customers, he adds. Companion Has Three Employer Clients The South Carolina Blues plan's Companion Global subsidiary is offering international benefits to its 1.5 million members, has contracted with three self-insured employers (one in South Carolina, another in Florida and one in California) and has deals in the works with more employers, David Boucher, president and chief operating officer of the subsidiary, tells The AIS Report. Companion Global has providers in Singapore, Thailand, India, Turkey, Ireland and Costa Rica, with contracts with six more hospitals in other countries in the works, Boucher says. Even in Ireland, the cost of care is 20% to 25% less than in the U.S., he asserts. Companion Global did talk with WellPoint about using its existing network, Boucher says. "We were hopeful they'd be interested in working with us, but they've gone on their own." He says "they are replicating the work we did, and doing due diligence at some of the same hospitals." So far, Companion Global has facilitated services for seven patients, including three dental and four medical cases, Boucher says. "We're neither discouraged or surprised by the low uptake from the start." He acknowledges that "this is going to take a long time" to gain traction. The company really began marketing its benefits in the last two months, he says. "What we've done is spent a lot of time working with primarily self-insured employer groups." He says it is important to "encourage employers to waive deductibles and out-of-pockets and sometimes pay for plane tickets" to increase use of the service. For instance, one employer group typically covers 80% of inpatient costs domestically, whether emergency or elective, he says. The plan has a $1,000 deductible. "If a member needs a CABG [coronary artery bypass graft], they
are confronted with an out-of-pocket cost of about $15,000 in S.C."
under that plan, he says. But if they "go to a Companion Global
provider, they layered in a benefit that covers [the procedure] at 100%.
On a case-by-case basis, they'll consider paying for one or two [airline]
tickets as well," he notes. If the company is going to save $60,000
by using an overseas provider, it could consider that kind of incentive,
Boucher contends. He adds that another company is considering splitting
the savings of a covered procedure with the patient who chooses to have
it overseas. |
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