1. How will US Healthcare Reform Affect Medical Tourism Jonathan Edelheit, CEO Medical Tourism Association www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited.

2. Expected Effect on Medical Tourism More US Insurance Companies and Employers will implement Medical tourism as a cost savings approach because of increased costs of health insurance Longer Waiting Times due to more insured patients and doctor shortages May Push American Patients to travel overseas for shorter waiting times More US hospitals may pull out of Medicare, which could drive more patients overseas Deloitte Predicted if US Healthcare Reform grows this will be positive for the medical tourism industry and more patients should leave the US www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited.

3. Healthcare Reform was signed into law on March 23 rd by President Obama Update: Senate Republicans found violations in two provisions of the health care bill, forcing it back to the House for another vote. Democrats say they expect the House to approve it quickly. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited.

4. Healthcare Reform was meant to give basic access to care to more Americans and to provide “preventative and wellness” at no cost to Americans. Not Necessarily meant to provide comprehensive coverage * Give free preventative care Congressional Budget Office reported that the latest health care reform legislation would, over the next 10 years, cost about $950 billion, but it would also lower federal deficits by $138 billion. There are differing views on the actual cost. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited.

5. Healthcare Reform Positives Waiving of Pre-existing Condition Clauses Eliminating Annual and Life Time Limits And other benefits Healthcare Reform was the expansion of healthcare benefits in the US, but there is a cost to this $$$$ www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited.

6. Statistics on Healthcare Reform from Different Organizations 19 Million ~ The number of people predicted to lose their employer plan (Lewin Group) 8.5 Million ~ The number of seniors and disabled people at risk of losing their Medicare Advantage Plan (Medicare Chief Actuary) 100 Million ~ The cost of Healthcare Reform mandates for Caterpillar, Inc in the first year alone (Caterpillar, Inc) 20% ~ Fraction of hospitals that would become unprofitable after Medicare spending cuts. (Medicare Chief Actuary) Congressional Budget Office (CBO) estimated that 8 million to 9 million individuals, mostly lower-wage workers and people who work for smaller employers, could lose their employer-sponsored coverage as a result of the legislation. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited.

7. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Before Healthcare Reform was passed Estimate of Health Insurance Costs in 2020 per year Individual Health Insurance - $13,763 Family Health Insurance $38,160 Healthcare Reform will increase health insurance costs, so these numbers will rise higher and faster.

8. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. What does Healthcare Reform do?

9. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Does Not create a public government plan. Still Private insurance industry. Health Insurance Exchanges will be created where people can most likely go online and shop for insurance from multiple insurance carriers Mandate that all Americans purchase health insurance or pay a fine Fine Mandates start in 2014 of only $95. Starting in 2016 fine for not having health insurance $695 or 2.5 percent of income, whichever is greater, By 2014, insurers may no longer charge individuals and small businesses higher premiums or deny coverage on the basis of pre-existing conditions. Waiving Pre-existing Condition clauses and making insurance premiums the same for healthy/sick people will drive health insurance costs up dramatically, making employers and insurers more interested in offering medical tourism as an option to keep costs down.

10. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. This will significantly increase health insurance costs in the US

11. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Big Drawback of How Pre-existing Waiver Reads in Healthcare Reform Law - Problem is people could not buy health insurance until they’re sick – destroys health insurance underwriting, the whole basis of insurance. It doesn’t penalize people who are waiting on purpose Recent example – have several bad car accidents because you are a bad driver, and your car insurance rates won’t be higher, you will pay the same as safe drivers. Safe drivers rates go up to cover bad drivers.

12. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Adding more Insured People Could Cause Long Waiting Times Healthcare Reform expected to insure 32 more million people (not necessarily comprehensively) Doctor Shortage leading to longer waiting times American Academy of Family Physicians predicted a shortfall of 40,000 primary care physicians. MA has mandated health insurance and patients have to wait. In Massachusetts, after the passage of Romneycare, the wait to see a primary care physician increased from 33 days to 52 days.

13. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Other Reform Elements that Drive Up Health Insurance Costs Dependents - allows young adults to remain on their parents' health insurance plans up to age 26. Elimination of lifetime caps/limits Insurers need to spend no less than 85 percent of money from enrollees on medical costs. In the individual market, that figure is 80 percent.

14. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Employer fines up to $2,000 if not provide insurance starting in 2014 who have more than 50 full time employees. Employers may push full time employees to part time, hourly or 1099 to eliminate having to provide coverage.  Means Americans with no health insurance coverage, more uninsured or underinsured 3 to 1 rates – Seniors pay less, and Health Insurance Costs for Young People to significantly rise.  Anything that increases health insurance costs, makes medical tourism more attractive in the US to insurers and employers

15. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. No Tort Reform – Medical Malpractice - Gallup Poll found that nine in 10 doctors admit having practiced defensive medicine at some time during their career – which increases the cost of healthcare in the US and no tort reform was passed A new survey in the New England Journal of Medicine reports that 46 percent of doctors may give up their practice in the wake of this bill. While that is probably exaggerated, many doctors will likely decide to reduce their patient loads or retire.

16. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Nine out of 10 physicians (92 percent) reported practicing defensive medicine* Physicians estimate that 34 percent of overall healthcare costs can be attributed to defensive medicine* Physicians estimate 30 percent of their own practice is defensive in nature* Jackson Memorial Healthcare October 2009 National Survey on QUANTIFYING THE COST OF DEFENSIVE MEDICINE While physicians attribute an average of 26 percent of overall costs to defensive medicine, 13 percent believe the practice constitutes 50 percent or more of the cost.* Of the physicians surveyed, 73 percent agreed that they had practiced some form of defensive medicine in the past 12 months. Twenty-three percent of practicing physicians estimate that defensive medicine constitutes less than 10 percent of their practice while 29 percent estimate the percentage to be between 10 percent and less than 25 percent.* Gallup Jackson Memorial February 2010 Survey

17. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Problems with Medicaid and Medicare Future Problems – Reduces Hospital Payments by possibly $102.7 billion over 10 years for Medicare and Medicaid. Already two Mayo clinic primary care clinics in Arizona drops Medicare in April 2010 because losing money. Treating medicare patients as out of network. Walgreens drops Medicaid Washington Drug Stores around country threatening to drop Medicaid

18. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Aftermath of Healthcare Reform Almost 13 attorney generals filed suit against US government already saying unconstitutional to force individuals to buy insurance Several states enacted legislation or in process prohibiting some provisions in healthcare reform bill Presentation not go into detail on Medicaid and Medicare reform under healthcare reform bill.

19. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Inbound Medical Tourism into the US No Real Effect International Insurance Companies not Affected Cash Paying Patients Not Affected Inbound Medical Tourism industry expected to continue to grow into the US and be a booming industry US hospitals may be more excited to take cash paying patients or patients from international insurance companies

20. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. In Conclusion Healthcare Reform will significantly increase health insurance costs in the US Employers, Insurers and patients in the US already can’t afford current insurance premium levels Medical Tourism may be only way for insurers, employers and patients to save significantly on medical tourism costs US insurers and employers have no choice but to look very hard at implementing medical tourism as otherwise costs are unaffordable Prefer foreign patients than Medicaid/Medicare patients because of low payments

21. www.MedicalTourismAssociation.com www.MedicalTourismMag.com ©Medical Tourism Magazine / Medical Tourism Association ™ Reproduction without permission of MTA or MTM is strictly prohibited. Jonathan Edelheit CEO of the Medical Tourism Association Jon@MedicalTourismAssociation.com (561) 791-2000