The increasing role of domestic medical tourism and its adoption by health insurance companies raises practical and ethical considerations for orthopaedic surgeons.
Courtesy of THINKSTOCK


Published 6/1/2015
Daniel K. Moon, MD, MS, MBA; Charles Carroll IV, MD

Domestic Medical Tourism: Coming to a Center Near You

Although medical “tourism” and itinerant surgery have been part of the medical profession since its inception, Domestic Medical Tourism (DMT) is becoming an increasingly common phenomenon. As a result, physicians and surgeons are faced with both practical and ethical considerations not previously encountered. In this two-part series, members of the AAOS Ethics Committee will outline some of these considerations, in the hope that they will be included in discussions on the topic.

DMT should not be confused with International Medical Tourism (IMT), in which patients travel to foreign countries to undergo medical procedures and treatment, usually at a far lower cost than they can find locally in the United States. IMT has raised concerns about whether the care provided by physicians not trained in the United States meets U.S. standards of care, who should bear the responsibility for complications once patients return to the United States, and how that treatment might be reimbursed. Warnings abound about language and cultural barriers, and many IMT patients concede that U.S. facilities may provide superior care, but cost savings are the primary incentive driving them overseas.

In contrast, DMT patients receive care from licensed physicians in American hospital settings. The growth in DMT has been fueled by several factors, including the following:

  • the role of the insurer or employer in directing care
  • the development of “centers of excellence” to attract additional volume
  • the desire to reduce healthcare costs
  • the shift to a “value-based”reimbursement system

The most significant difference between DMT and IMT is the role played by the insurer or employer in directing care. Previously, patients who travelled to physicians in other U.S. cities largely sought out physicians with unique clinical experience and specialized reputations, using their personal resources. Today, however, employers or insurers may select a DMT location and offer the patient financial assistance to receive care at that site.

As the cost of medical care has risen, new ideas and forces are brought to bear on the delivery of health care. DMT sites and large, self-insured employers or third-party payers will typically agree upon a standard bundled payment for common procedures (such as hip and knee arthroplasty or simple spine surgeries) that is much less expensive than patients’ local care options. This represents a significant cost savings opportunity for self-funded insurance plans, and these employers actively encourage employee participation.

Moreover, many DMT sites market themselves as “centers of excellence” and claim to deliver higher quality care and superior outcomes compared to average U.S. medical centers. The concept of a center of excellence is founded in the tradition of physicians working together to practice high-quality, efficient care and to provide top-level, but specialized, health care to various groups within the general population.

As sources of reimbursement and the amount of reimbursement per specific service decrease, payers and providers are looking for ways to cut costs, either directly or indirectly. Economies of scale may play a role, as do optimal outcomes without high rates of complications.

The shift to value-based payments also may contribute to the increase in DMT. Payers want providers to accept the financial impact of complications by assuming some form of financial risk for the provision of health and surgical care. Additionally, the percentage of healthcare costs absorbed by patients is increasing, bringing the concept of DMT further into play.

Employers and insurance plans may waive copayments and deductibles for patients who participate in a DMT program. In addition, the employer may pay for travel and accommodations during the patient’s treatment, even covering the costs of a companion. The opportunity to travel and see a different city, literally tourism, is advertised as a benefit for DMT patients and their companions.

If out-of-pocket costs for patients and their families can or will decrease if they seek care at named or directed centers of excellence that have contracted with their insurance company or employer, patients may see that as a benefit and more readily adopt DMT.

Potential benefits
If implemented well, DMT sites can provide significant value and justifiably claim to provide higher quality care at a lower cost. One potential source of DMT quality is a focus on high-volume providers. For example, at one DMT arthroplasty program, only physicians who perform more than 100 primary joint arthroplasties per year are included. Experienced providers with high volumes can potentially achieve better surgical results with fewer complications that result in readmissions or revisions and lead to better outcomes for patients and lower costs for their employers.

DMT sites create standardized, highly predictable, evidence-based clinical protocols; these are applied uniformly to their large number of patients. For example, at one site, the standard visit is 10 days for hip arthroplasty; each patient follows the same protocol, which includes the following:

  • a preoperative visit confirming the surgical indication
  • surgery the next day
  • overnight admission
  • return to hotel for therapy visits
  • return to hospital for final ‘clearance’ to fly home
  • scheduled follow-up with the patient’s local primary care provider for the remainder of postoperative care

Consistent clinical pathways further reduce errors, improve service delivery, and facilitate the management of exceptions when they arise.

Bundled payments are a signature of DMT programs. Bundles are priced competitively to lower costs for the employers and insurers. Internally, DMT sites reduce their own costs in the following ways:

  • limiting implant variability
  • standardizing medication and anticoagulation protocols
  • streamlining additional services
  • achieving economies of scale with suppliers
  • avoiding additional rehabilitation and skilled nursing stays
  • carefully screening patient comorbidities

In this way, DMT sites can reap a meaningful profit on patients who would otherwise be unavailable and beyond their standard geographic reach. The combination of high volume, quality care, and reduced costs also supports an ethical argument: DMT sites further promote an ethical responsibility to provide better care with our society’s limited resources. However, this may be offset by other arguments that the second part of this article will consider.

Work in progress
On many levels, the DMT phenomenon has significant potential to deliver higher quality care at lower costs. The emergence of numerous centers of excellence will continue the trends in concentration of care and standardization for certain orthopaedic procedures and indications. However, the ethical issues raised by these trends have not been sufficiently addressed, and more debate is needed among all the stakeholders, local and national, to resolve these issues constructively.

Daniel K. Moon, MD, MS, MBA, is a current member and Charles Carroll IV, MD, is the past chair of the AAOS Ethics Committee.


  1. AAOS Standards of Professionalism: Providing Musculoskeletal Services to Patients
  2. Ethics Resources: