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HEALTH INSURANCE: Doctors Without Borders

11 minute read
Leslie Berestein

Arturo Chavez hated waiting weeks for an appointment with his HMO doctor. So these days, the San Diego cabinetmaker does something much more convenient: he schedules appointments with a new doctor south of the border in Mexico, just a 40-min. drive from his home. Says Chavez, 36: “In Tijuana, I can make an appointment today for tomorrow.”

Patients like Chavez are part of what doctors in Tijuana call la ola verde–the “green wave” of Southern California residents washing into the border city’s medical clinics. Attracted by low prices and easy access, cash-paying travelers, most of them Latino, have for years come from as far north as San Francisco to obtain medical and dental care in Tijuana and other border towns. But these days, the patients are carrying fewer greenbacks and more plastic insurance cards, as a growing number of U.S. health-insurance companies offer bargain prices for those willing to get their care in Mexico.

Chavez, a legal U.S. resident who has lived in San Diego for 18 years, is insured through Blue Shield of California. He switched from an HMO in San Diego to one in Tijuana when his employer gave him a choice of policies six months ago. Now Chavez’s employer-paid plan costs $94 a month, down from almost $160. His co-payments are $4, down from $10. “I like it,” says Chavez. “I save a little money, and it’s nicer to sit down with a doctor who speaks Spanish.”

Blue Shield of California and Health Net of California two years ago began offering cross-border health-insurance plans that allow members living in the U.S. to obtain their primary medical care in Mexico. Dependent spouses and children living on the Mexican side can also sign up, as can Mexicans who legally commute across the border to work for American companies.

More than 26,000 people are enrolled in cross-border health plans, with the great majority having signed up in the past two years. Roughly half live in California, the rest in Mexico. Their numbers could rise if PacifiCare Health Systems, based in Cypress, Calif., enters the market–the company hopes to put together a pilot program by late next year–and the cost of health insurance continues to rise at an annual rate of 12.7%. And in spite of the American Medical Association (AMA), which warns of inferior care in Mexico, the idea is winning converts in other border states, including Arizona and Texas, where legislators and academics are studying ways to set up their own cross-border plans.

“Economics has made it so there are 8 million Mexican nationals living in the United States, yet due to immigration status, income or language barriers, their access to health care is very limited,” says David Warner, a professor at the University of Texas’ Lyndon B. Johnson School of Public Affairs, who has conducted several studies of cross-border health care and recently testified at a state legislative hearing. He considers the cross-border insurance policies “a step in the right direction.” Southwest Marine in San Diego offers its employees a choice between two U.S.-based health plans and a cross-border plan. Though there is a payroll deduction for employees who choose U.S. doctors, the health plan for the 100 workers who travel to Mexico is free. “It saves us money, and we like to pass those savings on to our employees,” says Ellen Vinck, who administers the company’s plans.

In California, agricultural employers and some labor unions have for years offered benefits to workers through cross-border preferred-provider organizations (PPO) that allow their workers to be treated by selected providers in Mexico for a minimal cost. Dental insurers also have long sent patients south. But cross-border medical HMO plans for the general population wereunheard ofuntil the mid-1990s, when Sistemas Medicos Nacionales (SIMNSA), a Tijuana-based HMO, began selling policies to employers in the San Diego area. At the time, there were no rules governing Mexican hmos selling insurance in California. “It was not legal, but it was not illegal,” says SIMNSA president and ceo Frank Carrillo. “It was just sort of a gray area.”

California officials decided to regulate the plans rather than shut them down and lose the benefit of low-cost health coverage in a state where an estimated 4.5 million are uninsured–more than half of them Latino. In 1998 California passed legislation that allowed Mexican HMOs to operate in the state, provided they offer benefits solely to Mexican nationals. SIMNSA was granted a license in 2000. So far, it is the only Mexican HMO approved to sell cross-border policies in California.

The Blue Shield and Health Net cross-border plans operate differently: any U.S. citizen or legal resident can enroll through an employer. Blue Shield’s Access Baja HMO lets members who live or work within 50 miles of the border choose a primary-care doctor in Tijuana or Mexicali (convenient for agricultural workers in California’s Imperial Valley), while those farther away must choose U.S. doctors for themselves but can enroll spouses and children living in Mexico with providers in those cities. Salud con Health Net offers HMO plans with similar rules. It also offers a statewide PPO plan that allows members throughout California to travel to Mexico for care.

The appeal for employers and consumers is the health plans’ relatively low price. For example, a standard Health Net HMO plan for a family of four costs about $500 a month, while Salud con Health Net’s low-cost HMO option costs about $300. Even if that particular family is not using Mexican providers, the fact that other plan members are doing so helps reduce plan costs all around. While an overnight stay in a California hospital can cost from $1,500 to $3,000, a bed in a high-quality, licensed hospital in Baja California costs only from $600 to $1,100 a day. 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.

Lowering out-of-pocket costs is a big draw for cross-border patients who can see doctors in Mexico. A typical Health Net co-payment that costs $15 in the U.S. will cost $5 with a Mexican provider, says Ana Andrade, an associate vice president for Health Net of California. But it’s not all about economics. The plans’ mostly Latino members are also attracted by doctors who speak Spanish and who generally spend more time consulting with patients than do their U.S. counterparts. “The service is warm and empathetic,” says Eduardo Pesqueira, a director of economic development for Mexico’s Ministry of Health and also a physician. “The doctor is seen as a counselor by a lot of people–as a friend.”

That’s one reason Maria Elena Click, 44, is willing to drive 40 miles from her job in Encinitas, in north San Diego County, to visit her Tijuana physician. She switched last year from Blue Cross of California to SIMNSA when her Blue Cross premium went up. She says her new cross-border plan is not only cheaper ($26 a month for herself and her teenage daughter, as opposed to the $170 she says she paid with Blue Cross), it’s also friendlier. In the U.S., “they leave you waiting in the examining room a long time,” Click said one recent afternoon in her doctor’s consulting room, an office with comfy chairs and a massive desk–the standard setup for Mexican clinics. “Here they pay more attention to you. They listen to you.”

Though most buyers of cross-border insurance policies are Latino, the price and quality of Mexican health care attract non-Latinos as well. Marvin Morton, 40, a sheriff’s deputy inSan Bernardino, Calif., wanted to get laser surgery to correct his deteriorating eyesight but was unable to have the procedure he wanted covered through his U.S. insurer, Kaiser Permanente. The cost out of pocket, he said, was “outrageous” at $3,000 to $5,000. So Morton and his fellow deputies lobbied their union, which came up with an alternative. The union contracted with two doctors, one in Irvine, Calif., and one in Tijuana, both of which offered the deputies discounted rates. But the Tijuana discount was far steeper: $1,000 for the surgery, as opposed to $2,000 in Irvine. The union was impressed with the Mexican doctor’s references, and Morton, who drove down to inspect the modern Tijuana facilities, was impressed on both counts. “They treat you like doctors used to treat you 20 or 30 years ago,” says Morton, who chose the Mexican doctor and was pleased with the results. “They don’t talk down to you. They talk with you. I haven’t seen medical care like that in years.” He no longer wears eyeglasses.

The AMA has not presented any legal challenges to cross-border plans, but it criticizes them. “We always have to be concerned with the quality,” says former AMA president Richard Corlin, a gastroenterologist in Santa Monica, Calif. Corlin remembers a patient telling him about a medication he was taking, which Corlin immediately recognized as a drug banned a year earlier in the U.S. because it produced sometimes fatal heart arrhythmia. “He said, ‘I get it in Mexico.’ Is there someone controlling what they have access to and what they haven’t? We do a pretty good job of that in this country. It is a lot harder to do in Mexico.”

The California-based health plans say they carefully screen the doctors their patients can use in Mexico, and Pesqueira at the Ministry of Health says there has been a concerted effort by the Mexican government to enforce quality control in recent years. “There are a few providers that are absolutely up to U.S. standards in everything they do,” says San Diego neurologist James Grisolia. “Then there are other people who vary in quality. The regulations are not as strict.”

California law provides that patients treated in Mexico through hmos licensed to operate in California have the same rights as those receiving care in California. This includes the right to an independent medical review and the ability to sue the insurance company. (Suing a Mexican doctor is more complicated, however, because it must be done under Mexican law). “It will certainly be interesting to see the litigation that comes out of this,” says neurologist Grisolia.

Some companies, such as Blue Cross of California, have shied away from the cross-border market. Spokesman Michael Chee says the company prefers to focus ondeveloping low-cost care in the U.S. Aetna teamed upbriefly with a Mexican insurer to market a cross-border HMO a few years ago but bowed out in part because oflower-than-expected enrollment.

Other U.S. states along the Mexican border are studying California’s experience. Proponents in Arizona and Texas are hoping cross-border insurance might help reduce the strain on their public-health systems, overrun by patients who–lacking health insurance–wait until they are so sick, they wind up in the emergency room. “Our hospitals are under siege right now,” says Marisa Walker, director of the Arizona-Mexico Program at the University of Arizona, who has been studying ways to develop cross-border health care in a state that has as many as 750,000 uninsured. “We definitely need to get some type of a pilot project.” Such a project may come relatively soon, as both Health Net and PacifiCare are eyeing Arizona as a logical next step for expanding their cross-border plans.

In Texas, where a majority of the nearly 5 million uninsured are Latino, the state legislature approved legislation last year calling for a study on the cross-border health-care issue. The results will be presented to legislators next year, when they will decide whether to amend state law to allow for cross-border insurance.

As both countries become increasingly intertwined, economically and culturally, cross-border health insurance will probably become increasingly common. Says the University of Texas’ David Warner: “It will help in the inevitable integration of the U.S. and Mexican medical systems.”

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