Flat Medicine Exploring Trends in the Globalization of Health Care

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					                                                                                                                          Global Health Initiatives

Flat Medicine? Exploring Trends in the
Globalization of Health Care
Robert K. Crone, MD

Trailing nearly every other industry,                  alternatives. Much of this activity is        only a significant first step for patients
health care is finally globalizing. Highly             occurring in the emerging economies of        in these emerging economies, but may
trained and experienced expatriate                     the Middle East, South and Southeast          also present alternative solutions for
health care professionals are returning to             Asia, and beyond. Three Harvard Medical       those patients in wealthier nations who
their home countries from training in the              International collaborations—in Dubai,        nonetheless lack adequate health care
West or are staying home to work in                    Turkey, and India— highlight these            coverage. The increase in health care
newly developed corporate health care                  trends and demonstrate the potential          quality and competitiveness around
delivery systems that can compete quite                for new models of global health care,         the globe is important, but these
favorably with less-than-perfect providers             as well as potential ramifications for        improvements will need to be matched
in Europe and North America. In                        patients and providers in the established     by the development of comprehensive
turn, these health care systems are                    economies of the West, including the          payer solutions, to benefit as many
attracting patients from around the                    United States. Although globalization is      people as possible.
world who are interested in exploring                  not a cure-all solution to achieving
high-quality, lower-cost health care                   universal access to health care, it is not    Acad Med. 2008; 83:117–121.

T   hroughout history, diseases and                    until recently, been roughly divided          that is underway in many populous
individual providers have been crossing                between the developed Organisation            countries in Southeast Asia, South and
borders, primarily from developing to                  for Economic Co-Operation and                 Central America, and the Middle East.
developed countries. Now, well-trained                 Development (OECD) countries and the          Here, life expectancy is increasing (and
and experienced expatriate providers                   “developing world” (Figure 1). The            with it, the prevalence of chronic
from these developing countries are                    former group comprises 30 countries that      disease), as are the numbers of health
returning home or staying home to work                 are home to 1.1 billion people. The latter    consumers with the means and
in newly developed corporate health care               includes just under a billion people living   willingness to pay out-of-pocket for
delivery systems that can compete quite                in the 50 least-developed countries in the    one-time, life-transforming interventions
favorably with less-than-perfect providers             world, most of which are in sub-Saharan       like cardiac surgery, joint replacement,
in Europe and North America. In                        Africa. The remaining 70% of the world’s      cosmetic surgery, and bariatric surgery.
turn, these corporate health care systems              population— 4.5 billion people—live in        These health consumers are better
are attracting patients from around the                the emerging economies of Asia, the           informed, less willing to wait for
world who are interested in exploring                  Middle East, and Latin America. It is the     treatment, and beginning to demand that
high-quality, lower-cost health care                   advancement of health care in these           these interventions be available close to
alternatives. Trailing nearly every other              countries that is, in effect, globalizing     home. They have a better understanding
industry, health care is finally globalizing.          health care.                                  of the value equation and will go where
                                                                                                     it’s necessary to get the kind of care they
                                                       As the health care systems in this middle     want. Most patient movement has been
The Changing Global Health                             group of countries develop critical mass      to centers of excellence within their
Landscape                                              through enhancing quality and patient         region, particularly in Asia and the
Is the effect of these shifts truly global?            safety, they will increase their ability to   Pacific regions. However, increasing
One way of viewing the development of                  attract and retain health care professional   numbers of patients are leaving one
health care infrastructure is to take a                experts, originate new technologies, and      region to seek care in another, and
revised view of how one might dissect the              develop new centers of excellence that        Western Europe and the United States
world health care landscape, which has,                will begin to draw patient flows and          are no longer the only health destinations
                                                       academic medicine away from the               considered by patients from the Middle
Dr. Crone is managing director, Academic Medical
                                                       historic centers of excellence in OECD        East and elsewhere.
Center Practice, Huron Consulting Group, Inc.,         countries. What will be the impact of
and clinical professor of anaesthesiology, Harvard     globalization on patients, providers,         Providers: New players and new
Medical School, Boston, Massachusetts. He served
as president and chief executive officer, Harvard
                                                       payers, and governments?                      opportunities
Medical International, from its founding in 1994 to                                                  In addition to patients, providers are also
November 2007.                                         Patients: Demographics and demand             on the move. It’s important to recognize
Correspondence should be addressed to Dr. Crone,       The single biggest driver for the             that the majority of medical professionals
Managing Director, Academic Medical Center
Practice, Huron Consulting Group, Inc., 470 Atlantic   development of regional centers of health     educated in developing countries receive
Avenue, 14th Floor, Boston MA 02210.                   care excellence is the demographic shift      their training from tax-supported

Academic Medicine, Vol. 83, No. 2 / February 2008                                                                                             117
Global Health Initiatives

                                                                                                                     Although it is not a measure of actual
    LEAST DEVELOPED                       EMERGING ECONOMIES               OECD COUNTRIES
                                                                                                                     health outcomes, accreditation is a
                                                                                                                     positive indicator that the building blocks
                                                                                                                     are in place, both structurally and from a
                                                                                                                     process perspective, to be able to provide
  Afghanistan, Angola, Bangladesh,
                                            111 Countries,                Australia, Austria, Belgium, Canada,       quality care.
       Benin, Bhutan, Burkina Faso,                                              Czech Republic, Denmark,
         Burundi, Cambodia, Cape                                                 Finland, France, Germany,
     Verde, Central African Republic,          including                         Greece, Hungary, Iceland,
          Chad, Comoros, Congo,                     India                       Ireland, Italy, Japan, Korea,        Payers: Insurance beyond borders
        Djibouti, Equatorial Guinea,               China                          Luxembourg, Mexico, The
         Eritrea, Ethiopia, Gambia,
                                              South America
                                                                                Netherlands, New Zealand,            In general, although conditions vary
       Guinea, Guinea-Bissau, Haiti,                                              Norway, Poland, Portugal,
      Kiribati, Laos, Lesotho, Liberia,       Central America                     Slovakia, Spain, Sweden,           nationally and regionally, emerging
            Madagascar, Malawi,                 Gulf States                     Switzerland, Turkey, United          economies still have poorly developed
  Maldives, Mauritania, Mozambique,             Middle East                        Kingdom, United States
    Myanmar, Mali, Nepal, Niger,                  SE Asia                                                            mechanisms for spreading financial risk,
    Rwanda, Samoa, Sao Tome,
   Senegal, Sierra Leone, Solomon
                                                 Indonesia                                                           and members of the middle class have
      Islands, Somalia, Sudan, Togo,              Pakistan                                                           limited insurance options available
         Tuvalu, Uganda, Tanzania,                 Russia
          Vanuatu, Yemen, Zambia               Central Asia                                                          to them. But this is changing, as we
                                               North Africa                                                          have observed in multiple settings.
                                                                                                                     New legislation in Dubai requires all
      (0.9 billion people)                    (4.5 billion people)                (1.1 billion people)               employers to provide health insurance
Figure 1 The changing landscape of global economic development, from the world’s least-                              for their employees; Turkey currently
developed countries to the developed Organisation for Economic Co-Operation and Development                          has a public health care system and is
(OECD) countries.                                                                                                    encouraging private systems to develop;
                                                                                                                     and in India, leaders have begun to
schools. Those individuals have been                      Crucial to the success of these hospitals                  advocate and develop new insurance
willing and able to migrate to the West                   are their willingness and ability to                       systems. In addition, U.S. payers are
for better training than is available in                  institute a culture of quality. They are                   now exploring an option that could
their home countries and very often have                  unhindered by legacy systems that are                      dramatically change the landscape in
remained there to pursue their careers.                   in place at older hospitals, so they can                   American medicine: offering insurance
One of the major attractions of training                  establish new practices and a new culture                  that includes foreign travel and treatment
and practicing in the West for these                      more easily. These entities are becoming                   for lower rates than the cost of
providers has been the wide availability                  extraordinarily successful regionally, they                comparable treatment in the United
of postgraduate training, which is often                  are competing globally, and their rise is                  States. This could include sending
limited or nonexistent in their home                      the most important new phenomenon in                       uninsured and underinsured U.S.
countries. Although there is little                       the globalization of health care.                          patients abroad for interventions that
question that the best training is                                                                                   would be cost-prohibitive or out of reach
still offered in the United States,                       Their eagerness to compete globally with                   in the United States, but which would
opportunities are now arising in                          other health care systems is exemplified                   be relatively inexpensive abroad. One of
emerging countries, providing another                     by their moves to gain international                       the first payers to develop such a plan is
reason—in addition to cultural or                         accreditation. Recognition by Joint                        Blue Cross of South Carolina, which
financial factors—for providers at least to               Commission International (JCI), the                        has made Bumrungrad International
evaluate the opportunity to remigrate                     international accrediting body of the                      Hospital in Bangkok the first provider
home.                                                     Joint Commission on the Accreditation
                                                                                                                     in its overseas network.2
                                                          of Health Care Organizations, has
Another important development in                          become a significant tool to help these
the emerging economies is the rapid                       hospitals attract patients and staff. In
emergence of privately financed specialty                 2000, JCI had certified three such
hospitals. These hospitals are specialty-                 hospitals; today, the number of JCI-
                                                                                                                     Table 1
focused green-field developments that                                                                                Rise by Region in Number of
                                                          accredited institutions is over 100 (Table                 Institutions Accredited by the Joint
cater to international patients and                       1).1 Even within the established market                    Commission International, 2000 to
citizens who are prepared to pay out-of-                  economies of Europe, JCI accreditation is                  March 2007
pocket for health care. They coexist with                 becoming increasingly important to those                                                                                                 March
public hospitals (which provide care to                   seeking treatment or career opportunities                  Region                                    2000              2006               2007
those who cannot pay) and are able to                     at these types of hospitals.                               Africa                                             0                 1                     1
“berry pick” patients to some degree                                                                                 ...............................................................................................
                                                                                                                     Asia                                               0              19                    39
to gain competitive advantage.                            At the same time that the number of                        ...............................................................................................
                                                                                                                     Europe                                             2              40                    47
Operationally, they are being designed                    privately financed specialty hospitals                     ...............................................................................................
from corporate models that prize                          seeking JCI accreditation has increased,                   Middle East                                        1                 7                  19
efficiency and innovation, and their                      the process of qualifying for accreditation                South America                                      0                 4                  10
lower-cost labor force, compared with                     has become more rigorous. However, it is                   Total                                              3              71                 116
established market economies in Europe                    important to recognize that accreditation
                                                                                                                     Source: Joint Commission International1 (http://www.
and North America, allows them to price                   by JCI is the ground floor for quality           
services competitively.                                   benchmarks, rather than the ceiling.                       Accessed October 17, 2007.

118                                                                                                              Academic Medicine, Vol. 83, No. 2 / February 2008
                                                                                                                      Global Health Initiatives

Governments: Changing roles                         research programs. The government of         the gamut from primary and specialty
Traditionally, governments have assumed             Dubai has contributed land and funding       care to health promotion and disease
the roles of both health care provider and          to spur the development of DHCC, but,        prevention, have drawn more than 6,000
payer, but this is shifting in the least-           ultimately, the system will be financially   local participants and have been taught
developed and emerging economies. The               self-supporting and will represent a new     by more than 140 faculty, largely drawn
governments in emerging economies are               form of public–private partnership.          from HMS. The research programs are
increasingly focusing on paying for care                                                         just getting underway. The Dubai
and building intrasectoral reform—that              HMI’s role has been fourfold in this         Harvard Foundation is on a pace to raise
is, they are getting out of the business            program. First, HMI teamed with the          $100 million targeted for the endowment
of providing care and encouraging                   government of Dubai to create the Center     that will fund clinical, basic science, and
the development of public–private                   for Health Care Planning and Quality,        health services research.
partnerships to fill that role. They are            which is responsible for governance,
now looking to serve more as stewards               licensing and credentialing, and             The DHCC complex and its programs
and regulators of health care systems than          rationalization of resources within the      provide a model center of excellence for
as providers, and one of the governments’           campus. Second, HMI has created the          clinical care education and research in an
most critical aims in this evolving role            Harvard Medical School (HMS) Dubai           integrated way, and they also create an
will be to develop comprehensive                    Center Institute for Postgraduate            environment with the potential to draw
provider systems, to encourage the                  Education & Research (HMSDC) to              internationally trained professionals back
expansion of services for their own                 anchor the educational infrastructure of     to the region and encourage the public
residents or others.                                the campus. Third, HMI has developed         sector to improve to an equivalent
                                                    the Dubai Harvard Foundation for             standard. The Department of Health
                                                    Medical Research, based at HMS in            and Medical Services of Dubai has
Perspectives from the Field                         Boston, Massachusetts, to support            already requested that DHCC develop
                                                    collaborative research between scientists    credentialing and licensing models for
Three Harvard Medical International                                                              public facilities outside the campus.
                                                    and laboratories at HMS, DHCC, and
(HMI) collaborations highlight these
                                                    other regional institutions. Finally, HMI
health care trends in emerging economies                                                         Acibadem Health Care Group
                                                    has played a major role in the design and
and demonstrate the potential for new
                                                    development of a 400-bed tertiary care       Created less than a decade ago, the
models of global health care: Dubai
                                                    teaching hospital that, when completed       Istanbul-based Acibadem Health Care
Healthcare City (DHCC) in the United
                                                    in 2009, will be the linchpin of the         Group has grown rapidly into a network
Arab Emirates, Acibadem Healthcare
                                                    academic medical community at DHCC.          of six JCI-accredited general hospitals
Group in Turkey, and Wockhardt
                                                                                                 (two more are under development),
Hospitals Limited in India.
                                                    The building clusters in DHCC have           together with six ambulatory care centers,
                                                    been planned so that tertiary, secondary,    centralized laboratory facilities, and
Dubai Healthcare City                               and ambulatory clusters all have             satellite clinical facilities. There are
The government of Dubai approached                  clinical education and clinical research     outpatient care centers, and specialized
HMI in 2003 seeking assistance with the             embedded in them, around a core              centers for oncology, neurosurgery,
development of a health care provider               platform of services that emphasize          ophthalmology, infertility, molecular
system that would be based in a newly               quality with good clinical and               biology, cardiovascular diseases, and
created economic “free zone.” This                  administrative technology. Since             orthopedics. The network has agreements
represented a unique opportunity in                 opening at the end of 2005, the DHCC         with more than 1,000 physicians, has
medicine: to create a new provider                  community has grown rapidly to include       more than 1,500 beds, and currently
system based on best practices from                 nearly 20 licensed clinical service          treats more than 1.5 million patients.
around the world, in a zone where                   providers in areas such as cardiology,       The network is beginning to extend
essentially all regulations and standards           vascular medicine, nephrology,               into Central Asia, where there is the
are created from scratch as the system              ophthalmology, family medicine, plastic      opportunity to develop private health
develops. The result of this collaboration          surgery, and dentistry, as well as a         care services for a growing middle class.
has been a system which is unburdened               number of multispecialty clinics. As of
by existing systems and attitudes; which            July 2007, more than 400 health care         HMI has been working with Acibadem
is governed by its own rules and                    professionals, including approximately       since 2004 to establish quality care
regulations, planning processes, and                170 physicians, were practicing in DHCC,     models, particularly in the area of
system for adjudication of disputes;                and the community had recorded more          nursing. HMI and Acibadem are in the
and in which continuous quality                     than 50,000 outpatient visits.               midst of a several-year collaboration to
improvement is guided by a robust                                                                establish performance-based nursing
licensing and credentialing process.                Although there are medical schools in the    methodologies and to build nursing
                                                    Persian Gulf region, there has been little   leadership capabilities, with the goal of
The vision for DHCC since its                       or no postgraduate training there, and       reducing nurse turnover. Eight nursing
conception has been to develop an                   there have been limited opportunities for    leaders and about 100 nurse managers
integrated academic medical community               continuing medical education (CME).          across five hospitals have adopted quality
that serves the greater Middle Eastern              HMI (now through HMSDC) has been             methods. The results of the nursing
region, with comprehensive services,                conducting CME programs in Dubai             leadership initiative have been impressive
postgraduate medical training, and                  since 2003. The courses, which have run      as well, as Acibadem has seen the

Academic Medicine, Vol. 83, No. 2 / February 2008                                                                                         119
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turnover rate for nurses drop from over       departmental systems. Patients with
30% three years ago to between 13% and        renal, cardiovascular, and neurovascular           Table 2
15% in 2006 (personal communication,          disease can similarly be treated by                Comparing the Costs of Different
E. Brown, MSN, Harvard Medical                physicians with different specialties.             Types of Surgery in the United States
International, June 2007). Acibadem’s                                                            and India
goal is to reduce turnover to less than       Finally, there are the financial advantages        Surgery                                        U.S. ($)                 India ($)
10% per year.                                 to the corporate hospital model.                   Bone marrow                                    400,000                         30,000
                                              Wockhardt and other corporate hospitals            transplant
Wockhardt Hospitals, Ltd.                     have the luxury of focusing on the most            Liver transplant                               500,000                         40,000
The private health care sector in India       remunerative procedures. They have, so             Open heart                                       50,000                          5,000
today is worth $16 billion, and it is         far, little cost relative to research and          surgery (CABG)
projected to double in the next five years.   education (by choice), and costs related           Neurosurgery                                     29,000                          8,000
At the same time, less than 1% of India’s     to malpractice and liability are low in this       Knee surgery                                     16,000                          4,500
gross domestic product is now spent on        less litigious society. The cost of labor is
                                                                                                 Source: India Brand Equity Foundation. India
health care by the public sector, whereas     advantageous as well. A new nursing
                                                                                                 Healthcare: A Report by Ernst & Young for IBEF.5
4% to 5% is spent by the private sector;      graduate in the Wockhardt system earns             Available at: (
in recent decades, the private system has     between $3,600 and $4,200 a year; a                Healthcare_sectoral.pdf). Accessed October 17, 2007.
eclipsed the public system in spending.3      specialist nurse in the ICU with six to
                                              eight years of experience reaches $15,000.
                                                                                                 locations offer more Western-style
Wockhardt, the second-largest hospital        In both cases, the salaries are about 10%
chain in India, is emblematic of the new      to 20% of comparable ones in the United
wave of high-tech corporate health care       States (personal communication, V. Bali,           In each of these venues, patients are
networks that includes Apollo Hospitals       chief executive officer, Wockhardt                 treated by highly technically skilled
Group, Max Healthcare, and Fortis             Hospitals, June 2007).                             doctors, and sometimes with greater
Healthcare. Wockhardt has grown during                                                           innovation than is available elsewhere.
the past decade into a 10-hospital                                                               In fact, some of the most promising
                                              Implications at Home and Abroad
network with more than 1,500 beds. The                                                           procedures being performed on a routine
rate of growth can be attributed in large     Putting the picture together, it is clear          basis in India, such as hip resurfacing as
part to the cost-effectiveness of not only    that great change is coming. The rise of           an alternative to replacement, have
the network’s operations but also India’s     medicine in Asia and the Middle East is            not yet been adopted in the West. At
lower facility-construction costs.            underway to such an extent as to pose a            Wockhardt, surgeons have performed
Wockhardt and its competitors in the          serious challenge to health care systems           awake, beating-heart coronary bypass
private sector have employed a corporate      in Western nations.                                procedures on more than 300 patients.7
quality model that governs development                                                           They report that the morbidity and
from the first shovel in the ground to        Medical tourism, an industry worth an              mortality associated with this alternative
the day the first patient comes in the        estimated $60 billion and growing,4 is             is much lower than with traditional
door. The corporate culture under             another driver of change. High costs and           procedures—patients are not intubated,
development in these facilities has           long waiting lists have thousands of               anesthesia is epidural, and ICU time and
Wockhardt and providers like it using         patients in the United States and Europe           hospital stays are shorter.8
international benchmarks for quality to       looking abroad for life-altering care at an
assert themselves in the competitive          affordable price. An estimated 500,000             The changing global landscape, however,
global health picture.                        patients will travel to India for care             presents a number of questions. How
                                              in 2007—a trendline that has some                  will patients choose the right facility and
As with other new health care providers,      predicting that by 2012, medical tourism           provider? How will we measure quality in
another key to Wockhardt’s cost-              will infuse $2 billion into India’s                outcomes? For example, should there be
effectiveness has been the lack of legacy     economy.5 Thousands more patients will             pretreatment screening for such medical
systems to contend with; Wockhardt            turn to hospitals in Thailand, Malaysia,           travel? Does the patient actually need his
has been able to create new health            and Singapore, which has been a globally           or her hip replaced in the first place?
information systems from the ground           recognized health care destination for             How will one ensure adequate short- and
up that are aligned with their                years.                                             long-term follow-up? Who is liable for
operational goals, rather than work with                                                         mistakes? How is continuity of care
multimillion-dollar systems that have         Growing numbers of these patients are              provided across geographic boundaries?
been patched together over the years, as      from the United States. Many of them are           Overall, one critical issue will be to
is the case in a large number of U.S.         going to Mexico for cosmetic and other             develop a service that will provide higher-
hospitals.                                    kinds of relatively minor procedures,              end benchmarking, one which will truly
                                              but travel to Asia is increasing. For U.S.         compare quality and outcomes from
Clinical services at Wockhardt have also      patients, the lower cost of care abroad            institution to institution.
been conceived along newer lines of           will continue to be strongly attractive.
thinking rather than inside departmental      Care in India costs 15% to 20% of the              There have been and will be significant
lines. Thus, patients with diabetes can be    same offered in the United States (Table           implications of the global changes for
comprehensively cared for without             2). In Singapore and Istanbul, costs are           U.S. hospitals. First of all, there already
worrying about several separate               closer to 30% of U.S. values, but those            has been a rapid decline in international

120                                                                                          Academic Medicine, Vol. 83, No. 2 / February 2008
                                                                                                                          Global Health Initiatives

self-pay patient referrals to U.S. hospitals        nations. The cost base is unlikely to be      political will. Sustainable benefits in
since 9/11. For some American hospitals,            reduced much if American institutions         health care access will be attainable when
as much as 50% of their profits came                are simply rebuilt overseas, therefore        governments and citizens alike—in Iowa,
from the 5% of their patients who                   making it impossible for such institutions    in India— commit themselves to the
were international patients; many of                to compete with the lower-cost foreign        concept that access to health care is a
those patients are now gone, seeking                systems. Recruiting and staffing abroad       right, not a privilege.
care elsewhere overseas (personal                   would be difficult, and creating new
communication, J. Pieper, Partners                  American institutions abroad can put the
Healthcare, June 2007). The highly                  home brand at risk.                           Acknowledgments
remunerative, often invasive procedures                                                           The author wishes to thank Chris Railey for help
are starting to trickle out of the country,         Some of the alternate approaches being
                                                                                                  in preparing this manuscript.
with ramifications that extend beyond               tried now include partnerships between
the bottom line. For example, the chief of          American institutions and successful
plastic surgery at one Boston hospital              international regional players, the
                                                    creation of consulting and management         References
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                                                    companies to work abroad, and                  1 Joint Commission International. Joint
many fewer surgeries for cleft lip and                                                               Commission International accredited
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                                                    Des Moines as it is in New Delhi because
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                                                    disparities continue to exist at all levels
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The same holds for physicians. The U.S.             the work to enhance the quality of care in       16 –31, 2005. Available at: (http://www.
                                                    developing and emerging economies, is  
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                                                                                                   8 Chakravarthy M, Jawali V, Manohar M, et al.
physicians by 2020.11 Take just one group           emerging economies who are unable to
                                                                                                     Conscious off pump coronary artery bypass
of foreign-born providers: nonresident              pay out-of-pocket for health care or who         surgery—an audit of our first 151 cases. Ann
Indian physicians. There are about 60,000           are only able to do so at great personal         Thorac Cardiovasc Surg. 2005;11:93–97.
working in the United States, United                sacrifice, the rise of providers like          9 Hecker DE. Occupational employment
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                                                    The bigger hurdle is addressing the payer        February 2004:80 –105.
10% of all physicians in India.12 What
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                                                    benefits as many people as possible. In          current shortage of hospital nurses ending?
draw these physicians home, or keep                                                                  Health Aff (Millwood). 2003;22:191–198.
them home in the first place?                       the United States, this means untangling
                                                    a web of competing agendas and                11 Cooper RA, Getzen TE, McKee HJ, Laud P.
                                                                                                     Economic and demographic trends signal an
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United States. It would be difficult simply         Unfortunately, either approach will              physician migration. Health Aff (Millwood).
to bring U.S.-style facilities to other             require more than money—it will take             2006;25:380–393.

Academic Medicine, Vol. 83, No. 2 / February 2008                                                                                             121

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