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Baja’s Affordable Medical Lure

Quality of life expectations include access to affordable health care

In 1997, Pablo Schneider’s master’s degree thesis focused on border crossings into Baja by people seeking medical services. The SDSU student found more than 3 million such visits were being made each year, mainly to Tijuana. The services sought, in order of preference, were prescription medicines, dental care, eye care, vanity care (cosmetic surgery) and alternative medicine. The Schneider study did not address dollar volumes, but others estimated the annual amount to be in excess of $200 million.

Business is better today. The aging population on the U.S. side of the border is becoming increasingly vigilant and creative in seeking ways to control its health care costs. And for good reason. Milliman Inc., a U.S. consulting and actuarial firm, reports that from 2003 to 2007 the annual average medical cost for a family of four rose by 9.3 percent. Such increasing costs are putting medical assistance beyond the reach of many.

In the last decade in Southern California, the high cost of medical treatment created the need for U.S. medical insurers to investigate the potential of providing cross — border medical coverage with low premiums. Blue Shield began to offer an HMO dubbed California’s Access Baja, covering health care in Tijuana and Mexicali.

Today more than 170,000 Southern California workers are covered by the various programs providing medical services in Mexico.

In Mexico health care costs are 40 percent to 70 percent lower than in California. For instance, the private Excel Hospital in Tijuana performs heart surgeries at a cost between $30,000 to $40,000 while in San Diego the fee ranges from $75,000 to $100,000. Several of the surgeons at Excel perform the same procedures in San Diego. The daily room cost is about 30 percent of comparable care in a San Diego hospital.

Similar savings are found in dental, eye care and prescriptions, particularly when generics are available. To many Americans, the availability of such savings is the difference between access or nonaccess — buying needed medicine or food, obtaining dental work or losing teeth, seeing or going blind, etc.

A number of years ago, less expensive dental treatments in Mexico led to the creation of “dental tourism.” Americans needing major work traveled to places like Guadalajara where they stayed in fine hotels, took guided tours, availed themselves of the best restaurants and splurged on some shopping. It was still cheaper than having the dental work done in the United States.

As the medical savings phenomenon became a fact of border-crossing life, tourism authorities in Tijuana, Rosarito, Ensenada and Tecate paid little attention to the prospects of developing a well-defined and aggressive promotion program to build on the existing market.

That all changed after the Binational Affairs Committee of the Tijuana Economic Development Council took a look at the issue. The committee is being headed by Flavio Olivieri, whose overview on the situation appears elsewhere in this magazine.

The Tijuana EDC contracted with the Autonomous University f Baja California to perform a study on the feasibility and demand for assisted living developments in Tijuana and along the Pacific Coast. The conclusions were eye — popping.

The first finding destroyed the existing perception that aging U.S. residents lacked the disposable income to make them worth a marketing effort. Rather, the study showed this segment of the U.S. population has annual spendable income of more than $200 billion a year and earnings that duplicate that of the under-35 crowd. The aging Americans are divided into three sectors: Active seniors, frail elderly and nursing-dependent elderly.

Many of the constructed or under construction coastal single-family houses and condos are marketed mostly to the first category, active seniors. The focus of the Tijuana EDC was to determine the potential for the second and third sectors. The study included a series of interviews with U.S. expatriates living along the Baja coast. The focus group meetings presented many positive findings. Possibly the most important was that the majority of respondents were satisfied with the level of medical services in Baja, and the corresponding costs.

The first steps in deciding whether to retire in Mexico takes place when visiting an area and determining if the region is to one’s liking, a process that explores the costs of achieving a desired quality of life and access to acceptable medical services. Already acting as ambassadors on the medical front are Baja’s good and affordable dentists, eye doctors, medical clinics and medicines. Now look for Baja officials to jump in with some marketing support.

Yet the greatest promotion for settling in Baja will continue to be supplied from north of the border: The high cost of housing and medical care in the United States.