Outsourcing Your Heart

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But people don't have to be in Steinard's--or Miller's--straits before they cross borders for care. Retirees, especially the snowbirds who winter in South Texas and Arizona, have turned Mexican towns like Nuevo Progreso (pop. 9,125; dentists, 70), in the Lower Rio Grande Valley, and Los Algodones (pop. 15,000; doctors and dentists, 250), near Yuma, Ariz., into dusty dental centers. Los Algodones might rake in as much as $150 million during the winter season. People from Minnesota and California arrive in chartered planes to get their teeth fixed in these dental oases. Two California insurers, Health Net and Blue Shield, for the past few years have marketed popular health-insurance plans, aimed at Latinos, that charge lower premiums and cover treatment on both sides of the border.

Mexico's medical industry is just beginning to bubble; India's, like its other outsourcing segments, is booming. Apollo Hospitals, one of the largest private chains in the world with 46 hospitals in three countries, and Wockhardt Hospitals Group, which has eight hospitals in India, are working through agencies like IndUShealth, PlanetHospital and the Medical Tourist Co. in Britain to build business across the West.

Trehan plans to launch next year, in partnership with GE, the first installment of a vast, $250 million specialty Escorts hospital complex near New Delhi that will feature luxury suites, a hotel and swank restaurants for patients and their families. "We will be the Mayo Clinic of the East," he says. Max Healthcare is also planning a specialty complex in New Delhi (fields: neurologic, orthopedic, ob-gyn and pediatric).

A corresponding boom is taking place among Western agencies that funnel patients to Asia. Eight have popped up in Canada, where national health care can mean a yearlong wait for elective surgery. In the U.S. several firms are aiming at the roughly 61 million people who are uninsured or underinsured. PlanetHospital's founder, "Rudy" Rupak Acharya, says his agency, which in the past seven months has sent some 200 patients abroad, got 11,000 inquiries in March alone. He has just retained Mercer to help him develop an insurance plan for the uninsured that will combine primary and emergency care in the U.S. with surgery abroad.

Patrick Marsek, managing director of the agency MedRetreat, says his company sent 200 people abroad last year and is already processing 320 this year. He is demanding a deposit of $195 from customers because people posing as patients have been looking for information to start up their own agencies.

Will U.S. insurers join the party? Mohit Ghose of the trade group America's Health Insurance Plans says many have taken note of medical outsourcing but are scared off by the regulatory and legal uncertainties. Aaditya Mattoo, a World Bank economist who has published a study on the potential of medical outsourcing, suspects that pure institutional inertia has something to do with the lack of interest.

Yet as the medical-cost crisis deepens, the corporations who pay insurers are likely to find the lure of outsourcing as irresistible in health care as it is in software.

WAYNE STEINARD'S HEART WAS BROKEN ...

With no health insurance and lacking $60,000 for a badly needed operation, Steinard, a 59-year-old Floridian, hopped onto the Internet and then onto a plane to India ...

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