American Companies Building Hospitals in Mexico Near Border

Dorthea, 72, a retired bank teller, lives in Harlingen, Texas, a city of about 67,000 in the heart of the Rio Grande Valley. Like a lot of Texans, she's crossed the border to Mexico a few times to buy cheap medication. But she'd never considered undergoing complicated medical procedures there—at least, not until she was quoted the prohibitive price of $30,000 for a gastric-band procedure, a treatment for obesity in which a band is placed around the stomach to limit food intake. It wasn't covered by her insurance, so Dorthea, who asked that her last name be withheld for privacy reasons, opted to drive south and pay less than $10,000 for the outpatient operation at an American-owned hospital in Reynosa, Mexico, 10 minutes over the border and about an hour from her home. The outpatient surgery was a success, and she's planning on returning for follow-up care. "It was very good treatment," she says.

Medical tourism, which used to be mainly for elective surgery, and aimed at people who could afford weeklong trips to Brazil, is becoming an increasingly viable source of more basic health care for some of those sidelined by the insurance system in America, where 47 million people are uninsured and many millions are underinsured. Now, Americans like Dorthea who live along the Mexican border are driving and even walking south in search of treatment that can cost half or less of what it does in the United States. In response, American hospital chains are starting to buy into Mexico; Dallas-based CHRISTUS Health has built six hospitals in Mexico, including the Reynosa facility Dorthea visited, through its partnership with a Mexican chain. Most of its doctors are Mexican with Mexican medical degrees.

The Mexican health-care option is particularly appealing for Texans because the state has such a high uninsured rate; it was 25 percent in 2004. Along the border, that number is even higher. Incomes in the area are low, too, so even when employers do offer insurance, the cost of medical premiums still may prohibitive for employees, according to a 2007 report prepared by Texas state authorities.

And though hospitals on the U.S. side pour hundreds of millions of dollars a year into charity care, they and other community health centers are strained. The Hope Family Health Center in McAllen—right across the border from Reynosa—sees from 50-100 uninsured patients a week, but always has a waiting list, says interim executive director Rebecca Ramirez, who adds that she has some family members who will drive to Mexico for their medical care.

Older Americans who live near the Mexican border have always crossed in search of dental care and pharmaceutical drugs, neither of which are fully covered by Medicare, according to Prof. David Warner, who studies cross-border health care at the University of Texas's LBJ School of Public Affairs.

This growing demand for lower-cost procedures is fueling an increase in hospital construction, often in developing countries and targeted in part at foreign customers. Mexico's largest private-hospital chain, Grupo Empresarial Angeles, is building 15 new hospitals over the next three years and hopes foreigners will make up 20 percent of their patients by 2010, up from 5 percent now.

American chains are getting into the act, too: International Hospital Corp. in Dallas has five Mexican locations, one close to the American border. And CHRISTUS, which bought a majority stake in Mexico's Grupo Muguerza in 2001, has grown a two-hospital chain to eight hospitals nationwide. CHRISTUS representatives say they're expanding to benefit Mexican patients but remain very aware of their increasing American clientele.

Procedures performed in CHRISTUS's Mexican locations cost a third to two-thirds less than they would in America. And when its biggest hospital, in Monterrey, became one of the first in Mexico to be accredited by the international Joint Commission (www.jointcommission.org), an independent nonprofit hospital-safety accreditation organization, its foreign patient load increased exponentially, from one patient a week to eight or nine. People come from as far away as Alaska in search of bariatric, plastic and cardiovascular procedures, as well as knee and hip replacements and hospital officials plan to start hiring more English-speaking staff, translators and concierge services, says Arturo Garza, CEO of the CHRISTUS Muguerza Group in Mexico. He expects the volume of American and other foreign medical tourists to only grow.

Americans already make up 30 percent of the patients at CHRISTUS's Reynosa facility, which opened this year and is not yet internationally accredited. "Reynosa's part of a cross-border strategy," says CHRISTUS CEO Dr. Thomas Royer. There are opportunities for similar hospitals to be built in about 40 other Mexican communities close to the American border. But the company is waiting to see how Mexican-American immigration policies develop before making any bold decisions, he says.

Insurers are looking into cross-border health care, as well. For years, Southern California's Blue Cross Blue Shield has offered a cross-border health insurance plan that grants drastically reduced premiums to patients who get certain procedures performed in Mexico. But not all proposals have been met with excitement: Texas state Sen. Eddie Lucio, who represents counties including Cameron and Hildago, last year proposed a bill that would have allowed U.S.-based insurers to cover health services in Mexico for Texans living within 75 miles of the border. The bill didn't make it out of committee.

Meanwhile, medical tourism worldwide continues to grow. The industry grossed an estimated $60 billion in 2006 and is expected to hit $100 billion by 2012, according to the Confederation of Indian Industry and McKinsey and Co. Generally, people travel to foreign countries for better deals on procedures ranging from breast implant surgery to in vitro fertilization cycles, or for access to experimental surgeries that haven't been approved at home.

There are downsides to getting serious medical treatment abroad—whether it's a face-lift or a knee replacement. Accurate statistics on botched procedures involving foreign nationals at hospitals around the world aren't available, but critics point out in addition to the lack of information about the quality of care in various countries, there are inherent drawbacks in a situation where patients have to return to another country to get follow-up care. And of course there's often a lack of access to malpractice insurance coverage in Mexico and other countries. But a similar argument could be made against American health care, the University of Texas's Warner says: "It's not clear that you have such wonderful protections here, especially if you can't afford to get the care, so then you go to a public facility that's more or less protected from too much malpractice liability."

These concerns aren't stopping Texans who view the hospitals across the border as an affordable alternative. Dorthea says that three of her friends have also gotten medical care in Reynosa, and she'd recommend the hospital to any of her acquaintances. It remains to be seen whether more Americans will take a gamble and bet that Mexican hospitals can provide care that is as good as their counterparts north of the border. Meanwhile, as Warner points out, for the uninsured, Mexico may be the only option.