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Crossing Borders for Health Care

May 27, 2009

As the health care reform debate shapes up, the special interest are yet again doing their best to scare people. It’s 1994 all over again. The latest ad features a Canadian woman who claims she would have died of brain cancer had she not ventured across the border, to be saved by the US healthcare system. And we see this argument pulled out of the hat over and over again, whenever we talk about the failings of the US healthcare system (such as 80 million either uninsured or seriously underinsured). Whatever the merits of this particular woman’s case, the general argument itself has no merit whatsoever.

An academic study in the Health Affairsjournal finally puts this myth to bed (hat tip to Paul Krugman). Bottom line:

“Results from these sources do not support the widespread perception that Canadian residents seek care extensively in the United States. Indeed, the numbers found are so small as to be barely detectible relative to the use of care by Canadians at home…Canadians coming south with their own money to purchase U.S. health care—appear to be handfuls rather than hordes.”

Jonathan Cohn puts it all in perspective:

“For those who’d like a review: Canadian health care has strengths and weaknesses. The strengths include superb primary care, administrative simplicity, and the kind of cradle-to-grave financial security virtually no Americans enjoy now. The weaknesses include some long waits for specialty care–although statistics suggest Canadians are not, on the whole, ending up in worse health than Americans because of them.

The real lie here, though, is in ads’ broader implication: That, by reforming health care, “Washington” (a.k.a. President Obama and his allies) would import “Canadian-style healthcare” and, as a result, deny people life-saving treatment. This is demonstrably false.

Remember, Canada has a single-payer plan–one in which the government insures everybody directly, with virtually no role for private insurance. No politician with serious influence is talking about creating such a plan here (even though, for the record, I think such a plan could work pretty well if designed properly). In addition, Canada spends far less than we do on health care. That means fewer resources which, in turn, contributes to waiting lists. No politician with serious influence is talking about reducing spending to Canadian levels (although, to be clear, we should be spending less than we do now).

Reformed health care in the U.S. would, in all likelihood, look more like what you find in France, the Netherlands, or Switzlerand. These countries don’t have problems with chronic waiting times. In fact, access to some services–particularly primary and emergency care–is easier and quicker than it is in the U.S. But these countires also make sure everybody has insurance coverage–and generous coverage at that. In other words, they get the best of all worlds. Not surprisingly, their people are far happier with their health care systems than we are with ours.”

One final point: Canadians might not be running south to the US, but Americans seem to be running south to Mexico— almost one million Californians go to Mexico each year for affordable medical care.

  1. May 27, 2009 5:28 pm

    The types of people who cross borders for medical care and the type of care they cross for probably says a lot about the relative strengths and weaknesses of the countries involved.

    Canadians with money who have major medical problems cross the border to get care in the US that they either can’t get in Canada or would have to wait too long for. These numbers are necessarily small since the number of people who both have major medical problems they can’t get treated in Canada and also have the money to do so privately in the US is necessarily small.

    US residents and citizens (the report you link to only covers California, but I know a lot of Texas residents who do the same, and I’m sure some in Arizona and New Mexico as well) generally cross in order to get routine care at lower prices. For instance, an uncle of my wife’s who lives right on the Texas/Mexico border routinely crosses over to pays out of pocket for all his family’s dental work — because as a small business owner that’s cheaper than getting dental insurance or paying out of pocket in the US.

    What this tells us is hardly surprising: Canada is not as good at providing expensive, cutting edge treatments quickly as the US is. And Mexico is able to provide high quality routine care at much lower prices than US facilities. The cheapness of the Mexican facilities is mostly driven by freer market economics there for high quality routine care and less regulation and legal liability.

  2. David Nickol permalink
    May 27, 2009 7:22 pm

    The cheapness of the Mexican facilities is mostly driven by freer market economics there for high quality routine care and less regulation and legal liability.


    You make it sound like if the United States only had a freer market and less regulation, we could get medical care at Mexican prices!

    What about the fact that per capita income in Mexico is a quarter of what it is in the United States?

    I found this in an old (2002) Time magazine article:

    The average salary last year of general practitioners in California was $149,000, compared with the $35,000 to $50,000 earned by Mexican doctors. “It depends on the specialty, but for the most part the doctor’s profession is not lucrative at all,” says SIMNSA’s Frank Carrillo. One reason doctors in Mexico are more easily accessible, he says, is that they work longer hours to earn better pay.

  3. May 27, 2009 8:10 pm

    Yes, it’s strange that people still think the free market is the answer to health care, when international experience points to single payer being cheaper and better, in terms of outcomes. And the liability angle is a canard — I remember a study a few years ago, a very comprehensive study, completely debunking the notion that liability drives up health care.

  4. El Gringo permalink
    May 27, 2009 8:11 pm

    Here’s some first hand experiences with healthcare in México.

    I needed a replacement filling. A US dentist set me up with three appointments at $75 each to accomplish this. I went to a Mexican dentist, had it done in 20 minutes, for $18. Both dentists were graduates of the same US Dental School.

    I was taken to emergency on a Sunday morning in central México. A doctor saw me immediately, determined the problem and presecribed medicine. Total cost: $12. I took a friend to emergency in California where she was asked to pay $75 to be seen.

    Having reached “that age”, and over the objections of the “plan”, my family doctor has continued to see me as necessary. However, now “the plan”, whose “home base” in in New Delhi, requires my doctor to refer me elsewhere for most services formerly done in office. For something that used to take about 15 minutes, I have seen eight different doctors, gone to an x-ray lab that refused to release the results to my own doctor, and had two visits to a physial therapist. The problem persists. In México, this would have been taken care of a year ago, and for a lot less than the more than $2,000 that has been billed so far here.

    I have a friend who must take a specialized prescription for the rest of her life. The US govenment is being billed $1,000 per month for her medicine. I talked to a pharmacist in México, who told me this drug is only available from one source, in the United States, but that he could fill a month’s supply for about ten dollars.

  5. May 27, 2009 9:06 pm

    Wouldn’t a system which led to better outcomes (as Morning’s Minion has indicated), plus the societal good of no one ever having to declare bankruptcy due to medical bills ever again in the US, be worth whatever minor inconveniences result from changing from the current system to a European-style system?

    The usual suspects are opposing health care reform because they know that if Americans ever get a taste of the advantages of the European system, there will be no changing their minds back: the scare-mongering will be permanently exposed as scare-mongering (I’ve heard single-payer described as “tyranny,” for cryin’ out loud), and Americans will happily get on with their lives.

  6. May 27, 2009 9:28 pm

    I mean, think about this for a second: the US healthcare system is the only system in the developed world that routinely bankrupts the sick. I’m pretty sure if I looked up “sin” in the dictionary, that would fit the description. If a group of characters in a movie did that, they’d be the bad guys, and probably Nazis. I mean, really.

  7. May 27, 2009 11:01 pm


    Markets aren’t the fix for everything, but they have their uses. (As it happens, I was telling a Canadian theology student I ran into at an ordination reception last weekend about studying up on health care in order to work on the series of posts that Eric Brown and I are working on, and he commented, “It’s interesting that you down here are looking at centralizing your health care system down here more at the same time that we’re trying to get more free market elements into ours so that our doctors will stop leaving for the US where they can make more money.”)

    Getting quality routine care in Mexico is much cheaper for US residents for several reasons. Mexico has a much lower median income and more inequality than the US. Thus, US patients are very attractive to Mexican doctors, and they can afford to charge less than US doctors because the people they in turn purchase goods and services from are less expensive than those that US doctors deal with. Put another way, that $50k average salary for Mexican doctors probably goes at least as far if not farther in terms of what they can buy than a $200k salary for a US doctor living in a major metripolitan area.

    Also Mexican health care is much less regulated than US health care. That’s not always a good thing. It means the worst health care you’ll get in Mexico is much, much worse than the worst health care you’ll get in the US, but if you go to a top level provider the care is comparable to that in the US but with the reduced costs associated with little regulation or liability. If you want to provide actual links to studies showing that liability costs nothing, feel free. It seems rather nonsensical on the face of it that malpractice premiums of over 250k/yr would have “no effect” on costs and would not result in a lot of procedures that are basically tail covering. Indeed, the experience my wife and I had with the birth of our fourth child was very much one of doctors insisting on much, much more expensive (and invasive) procedures because of a very, very tiny increase in risk which we were told up front was really only a concern because of liability.


    Well, saying that the US health care system _routinely_ bankrupts the sick is rather a stretch. The only study I know of that supports the high numbers bandied about for medical bankrupcies was based on attributing any bankruptcy which included any medical debt at all (even if that debt was only a few percent of the total owed) to medical causes. Also keep in mind — it would do the health care industry no good if they did routinely bankrupt people, because when one declares bankruptcy one’s creditors don’t get paid. Indeed, it would actively hurt the health care industry to drive people into bankruptcy.

    One can certainly idolize the European system, but it’s important to realize that we can’t simply switch over to, say, a French-type system and immediately realize benefits similar to those of the French. For instance, doctors in France make roughly 60% what they do in the US. Now, I don’t see Obama getting a 40% pay cut for all doctors past the AMA’s lobbying muscle, so it would be pretty reasonable to assume that US health care (all other things being equal) would continue to be roughly 40% more expensive than French health care. (The difference in percentage of GDP spent on health care between the US and France is 43%.)

    Also, centralizing is not necessarily the only answer. As Blackadder has pointed out, Singapore’s heavily free market approach to healthcare delivers outcomes as good as Europe’s at an even lower cost.

  8. May 27, 2009 11:36 pm

    Out of curiosity, what is your source for the 80 million un and underinsured claim?

  9. May 28, 2009 12:01 pm

    Also keep in mind — it would do the health care industry no good if they did routinely bankrupt people, because when one declares bankruptcy one’s creditors don’t get paid. Indeed, it would actively hurt the health care industry to drive people into bankruptcy.

    They can deal with medical bankruptcies by raising the rates for everyone else to make up for them. It’s just a “cost”, like labor or depreciation of physical plant or whatever, because that’s how it works when health care is a business and not a public service. That’s also why insurance companies go to great trouble to only insure the healthy: sick people are an “expense” they’d like to avoid. The whole enterprise just strikes me as depraved.

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