Cross-Border Insurance Revisited
Texas Gov. Rick Perry once supported a binational U.S.-Mexico health insurance plan. Why didn’t the idea grab the Lone Star State’s fancy?
One of the earliest hiccups in Texas Gov. Rick Perry’s bid for the Republican nomination came in September, when opponents brought up his endorsement, in 2001, of a study to create a binational U.S.-Mexico health insurance plan. That controversy quickly faded behind others, but it left a big question hanging: Whatever happened to the idea, one that seemed both to help a needy population and tickled the fancy of a very right-of-center politician?
Nothing happened. Not in Texas anyway. Yet the study, which Perry called an “important” look into the feasibility of private sector, binational health insurance that could “treat maladies unique to this region,” actually found much to like about the idea.
According to the Texas Interim Committee on Binational Health Benefit Plan Coverage, “The development of an affordable health insurance product could result in a number of cost savings for Texas.” It could replace Children’s Health Insurance Program coverage for a portion of participants and “therefore save both federal and state money.” It could reduce the amount of uncompensated health care significantly: “If even 30 percent of the uncompensated care provided in 1997 were to be paid for under private insurance, the reduction would be $180 million,” the report found. And it could lead to a healthier workforce, which in turn would increase productivity and the state’s overall economy. “It is not possible to precisely quantify the cost savings due to these measures,” the report concludes, “but the savings could be significant.”
So why didn’t the idea grab the Lone Star State’s fancy? Well, Texas’ medical lobbyists didn’t like the competition from less costly Mexican providers, and argued that Mexican medicine was unsafe. That opinion isn’t held by everyone though. “Most middle-class Anglo-Americans are pleased with health care in Mexico,” says Sarah Horton, an assistant professor of anthropology at the University of Colorado at Denver, who researched the issue. “They felt Mexico gave them access to more services and greater quality of care -- better than they could afford in the U.S.”
Cross-border insurance has been around since the 1970s, mostly in California where it was informally offered. In 1996 the California Department of Managed Health Care and the Mexican government created Sistemas Médicos Nacionales, S.A. de C.V., the first Mexican HMO, which provides citizens legally employed by California companies the option of receiving their health care in Mexico. There are a few other private-insurance plans like this available as well. But they are limited in size, scope and coverage. “It’s not readily available to anyone who wants it,” Horton says.
But the demand for binational plans exists. “There are enough people who cross the border totally legally and appropriately, and a product would be helpful and attractive to them,” says Anthony Wright, executive director of Health Access, a California consumer advocacy coalition. “The thornier issue is, how do you make that work?” Among the many problems are significant cost differences between the two countries, drug-related violence in Mexico, the powerful medical lobbies and the fractious U.S. immigration policy.
Advocates haven’t given up, though. The Mexican Health Ministry has pilot projects in Iowa and North Carolina working with community health delivery systems to address access to care, says Gil Ojeda, director of the California Program on Access to Care, a public service program for immigrants and the working poor based at the University of California, Berkeley. “There is no good operational model yet,” Ojeda says. “The issue is always money. Unless the government gets involved, it is hard to do.”
Yet, if there is a profit to be made, a way will be found, advocates argue. “Actually, retirees -- both Mexican- and U.S.-born -- may drive this,” says David Warner, a professor of Public Policy at the Lyndon B. Johnson School of Public Affairs at the University of Texas. As they look for affordable places to retire, they will join the many millions of working Mexicans -- legal or not, insured or not -- who would happily purchase binational coverage. “These people all live within a few hours of the border and are comfortable getting health-care services in Mexico,” Warner says. “There is a market for some kind of product.”