Outsourcing Healthcare

If you didn't like the idea of sending automobile manufacturing jobs to China, you're really going to hate sending healthcare jobs to Mexico.

A recent report from the Economic Policy Institute says American companies have created 1.4 M jobs overseas this year, compared with fewer than 1M in the US. Those overseas jobs would have lowered the unemployment rate to 8.9%. This, in part, explains why corporate profits are rising, the stock market is at a 2 year high, but the US unemployment rate  stubbornly approaches 10%.

The same is happening to healthcare jobs. With the global demand for quality care mirroring the rise of the middle class in emerging nations, foreign medical doctors and nurses decide to stay in China, India or Brazil. I call it pre-sourcing. Why come to the US only to find out that you had a better opportunity at home? What's more, despite a predicted manpower shortage , places like NYC are making it harder for 3rd and 4th year students at foreign medical schools to do clinical rotations in their hospitals. Telemedicine and medical travel, growing to a 1B industry by 2012, is also leveling the playing field and enticing US doctors to go overseas to practice either full time or in locums placements. Exploding expatriot retirement communties in Mexico, Costa Rica, Panama and the Caribbean are singing an irresistable siren's song attracting medical talent to those balmy shores to care for local patients and aging Americans who want care closer to their new homes.

And, it is not just doctors and nurses going abroad. Demerol dollars are following them. Take, for example, the idea being floated that Medicare pay for cheaper, similar quality care outside of the US for retired Americans...at a price that's 50% less. If that idea doesn't get your blood boiling, how about allowing Medicaid patients the option of choosing less expensive care in Latin America or Asia, in their native language?

The economics of medicine is fundamentally no different in one part of the world than in another. Money and people flow to where they are treated best. Companies hire people and build plants where the demand is the highest and the profits most attractive.

Did you ask for Rosetta Stone software for Christmas?

Physician Outsourcing: Technology Will Flatten The Medical World?

Medical outsourcing is going to become standard practice for specialties that don't require high-touch patient interaction; Radiology is one such example.

Here's a story from Canada that shows how this will start, but it will become much more prevalant as 'local' or 'regional' outsourcing.

When an Ontario man fell off a ladder and struck his head recently, the life-saving medical treatment he received included a surprising assist from halfway around the world.

The radiologist who read his brain scan, diagnosing a potentially lethal blood clot, was based in India, part of an unusual new twist on the overseas outsourcing trend.

A six-month-old arrangement between the Indian "teleradiology" company and an unnamed Canadian imaging centre is one of the first examples in this country of foreign medical outsourcing, a development that has professional groups and medical regulators here worried.

MRI, CT scan and X-ray images taken in Ontario and converted to digital format are zapped to the subcontinent over the Internet and interpreted by Canadian-trained Indian radiologists, who then report back on their findings.

A spokesman for Telediagnosys, based in the Western Indian city of Pune, said the service his firm offers is cheaper and faster than what is provided by overworked local specialists.

"Their earlier radiologist used to take at least 48 hours to give the reports and charged more than us," Dr. Ashish Dhawad, chief operating officer of Telediagnosys, said in an e-mail interview. His company turns around non-emergency work for the Ontario imaging centre within 12 hours.

Professional associations and regulators, however, question whether the quality of work would match that of a radiologist closer to hand, and ask whether disciplinary action would be possible against the offshore doctors if something went wrong.

"Imaging studies are not to be downplayed and treated as a commodity like a pound of butter or sack of wheat," said Dr. David Vickar, an Edmonton radiologist. "This is a consultation we are doing; it is not a laboratory test."

Meanwhile, as Canada continues to grapple with a severe physician shortage, observers speculate that foreign medical outsourcing could eventually expand to include other services, including pathology -- analysis of human tissue -- and even remote-control surgery.

In a paper just published in the journal Healthcare Quarterly, Sally Bean, a bio-ethicist at the University of Toronto, predicts that a lack of doctors and new technology will lead to a bigger role for health care outsourcing.

She suggests, though, that standards be developed to ensure privacy and quality are safeguarded and legal liability issues are addressed.

"It's a matter of how well it's done," Ms. Bean said. "If it's regulated and we're taking quality and safety and liability concerns seriously, then it could be a good thing."

Dr. Dhawad said his company has two radiologists who were trained in Canada and are certified in the specialty by the Royal College of Physicians and Surgeons. The firm has done mostly non-emergency work for a diagnostic-imaging centre in Ontario for the past six months.

All commercial markets, and medicine is a commercial marketplace, push for maximum efficiency. The fact that physicians will be impacted by this won't prevent it from happening and tired arguments that it's not in the best interest of patients are false on their face. While there will be much hand-wringing, gnashing of teeth, lawsuits and stories in the press of outsourcing gone wrong, it is in the best interest of the marketplace AND the patient population at large.

The fact that technology solutions are more efficient, more reliable, and scalable mean that this is an inevitability. It also means that it's an opportunity for physicians who embrace it.