Global Outsourcing of Healthcare: A Medical Tourism Decision Model

Pamela Smith and Dana Forgione
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Pamela Smith: The University of Texas at San Antonio
Dana Forgione: The University of Texas at San Antonio

No 33, Working Papers from College of Business, University of Texas at San Antonio

Abstract: The demand for global healthcare services is experiencing tremendous growth. US patients are seeking to reduce their expenditures on healthcare through obtaining treatment on an internationally competitive basis. This trend, known as medical tourism, is on the rise, and US legislators and policy makes must be aware of the issues facing American patients. This paper seeks to model factors that influence a patient's decision to seek healthcare services abroad. we develop a two-stage model for medical tourism- the first stage being the evaluation of the foreign country and the second stage choosing the healthcare facility. We argue country-specific characteristics influence the country of choice-including economic condition, political climate, and regulatory policies. We also argue that certain factors- including costs, hospital accreditaion, quality of care, and physician trining- impact the choice of healthcare facility. The model suggests that no one factor is dominant in the decision, but all play a crucial role in choosing healthcare on an international basis. Policy makers must use these factors to evaluate the impact medical tourism will continuw to have on the US healtcare system in order to effectively compete in today's global, consumer-driven healthcare market.

Keywords: Medical tourism; global outsourcing; decision model; health care system; healthcare services; health policy; health costs (search for similar items in EconPapers)
JEL-codes: M19 (search for similar items in EconPapers)
Pages: 13 pages
Date: 2008-02-07
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Citations: View citations in EconPapers (1)

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