Connect with us

Government

What does economy-wide inflation mean for the prices of health care services (and vice versa)?

Consumer prices rose 6.1% over the twelve-month period ending in January 2022, driven by particularly rapid growth in goods prices. In parallel, wage growth…

Published

2 years ago

on

By Matthew Fiedler

Consumer prices rose 6.1% over the twelve-month period ending in January 2022, driven by particularly rapid growth in goods prices. In parallel, wage growth has picked up too, with labor costs up 4.0% over the twelve months ending in December 2021. Higher prices for goods and labor translate into higher input costs in the service sector, so it is natural to expect the prices of services to rise in response. Indeed, service sector inflation rose meaningfully over the course of 2021 and is now well above pre-pandemic rates. Thus far, however, health care services are an exception; as shown in Figure 1, health care inflation is only modestly above its pre-pandemic rate and has been steady in recent months.[1]

This blog post examines why this has been the case. In brief, while health care providers’ input costs are indeed rising faster than in the past, peculiarities in how health care prices are set are limiting the degree to which those higher costs are translating into higher prices. One important factor is how Medicare updates its prices for changes in input costs. Annual updates for most services are based on projected growth in input costs, and the updates for 2021 and 2022 were finalized when expected inflation was still relatively low; furthermore, prices for physician services are not updated at all to reflect input cost changes. While Medicare directly accounts for only around one-quarter of total spending on health care services, there are a variety of linkages between Medicare’s prices and other payers’ prices, so slower growth in Medicare’s prices is likely restraining health care price growth outside of Medicare to some degree. Other factors, notably staggered contract renegotiation dates in private insurance and idiosyncratic features of states’ processes for updating Medicaid payment rates may also be playing a role.

Importantly, these dynamics will wane if inflation remains elevated in the years to come. Notably, faster growth in input prices would ultimately get incorporated into Medicare’s projections, causing Medicare’s nominal prices for most services to begin rising faster. However, Medicare’s rules generally do not allow for “catch-up” growth in subsequent years if its projections for a given year turn out to be too low, meaning that Medicare’s real prices for most services will remain on a persistently lower trajectory unless Congress intervenes. Some catch-up growth is possible outside of Medicare, at least to the extent that slow price growth in those sectors does not directly result from slow growth in Medicare’s prices. Regardless, for as long as growth in the prices of health care services remains subdued, this slow growth will have a modest moderating effect on overall inflation since health care services account for 16% of all personal consumption spending.

How will economy-wide increases in prices and wages affect Medicare’s prices?

Medicare sets the prices it pays for health care services using formulas established by law and regulation. Those formulas specify methods for determining the relative prices of different services (e.g., conducting an office visit or performing a surgery) as well as how those prices are updated over time.[2]

For physician services, the Medicare statute specifies annual percentage payment increases that do not depend on input costs. For example, for calendar year 2022, the annual update is 0%. Thus, absent action by Congress, broader price and wage trends have no effect on what Medicare pays for physician services. Physician services (and other professional services also paid for under Medicare’s physician fee schedule) accounted for 18% of traditional Medicare’s spending on health care services in 2019.[3]

For most other services, including hospital and post-acute services, Medicare’s rules specify annual payment updates that are based in part on changes in input costs, as measured by a “market basket index” specific to each type of provider.[4] Importantly, however, each year’s update is determined using the projected change in the market basket index for that year,[5] and that projection is typically finalized in the second quarter of the prior calendar year.[6] Furthermore, with a few relatively minor exceptions, projection errors are not accounted for when determining the next year’s payment update.[7] Thus, if the projected market basket update for a particular year turns out to be too low, then prices will be lower than intended in that year, and prices will be lower in all future years.

This process is greatly limiting how much the current burst of inflation is increasing Medicare’s prices. To take the leading example, consider inpatient services. The fiscal year 2021 payment update was based on projections finalized in the second quarter of calendar year 2020, when inflation fears were not even a glimmer on the horizon; correspondingly, the projected market basket increase for fiscal year 2021 was just 2.4%, below the actual increase of 3.1%. Similarly, the fiscal year 2022 payment update was based on projections finalized in the second quarter of calendar year 2021, when inflation forecasts were generally still relatively low; correspondingly, the projected market basket increase for fiscal year 2022 was a relatively subdued 2.7%. Yet in light of the data already in hand through the fourth quarter of calendar year 2021, the actual increase in the market basket for fiscal year 2022 will be much higher; it will be 4.1% even if growth in the market basket index reverts to its pre-COVID pace for the remaining three quarters of the fiscal year, and it will be 5.3% if growth matches the trend over the four quarters of calendar year 2021. For other services, the particulars may differ, but the overall picture is likely similar.

Fiedler Figure 2

Notably, as depicted in Figure 2, the recent historical pattern had been for Medicare’s projections to overestimate the actual increase in the market basket; for fiscal years 2009-2019, the projected change in the market basket index was 0.4 percentage points above the actual increase, on average. Viewed relative to this history, the underestimates for fiscal years 2021 and 2022 are even more remarkable.

Consistent with these modest annual updates, the overall prices Medicare pays for health care services are up only 1.1% over the twelve months ending in February 2022, as depicted in Panel B of Figure 3. Other policy factors may soon temporarily push the rate of growth of Medicare prices even lower. The faster price growth observed in 2020 and 2021 largely reflected a set of temporary payment changes, including: a 20% price increase for inpatient stays including a COVID-19 diagnosis; the May 2020 suspension of the 2% reduction caused by the Budget Control Act sequestration; and a temporary increase in Medicare physician payment rates for calendar years 2021 and 2022. The increase for COVID-19 inpatient stays will cease whenever the federally declared public health emergency ends, which may happen in the coming months, and the latter two changes are scheduled to expire on a similar timeline.

Fiedler Figure 3

Importantly, the fact that growth in Medicare’s prices remains low—and appears poised to remain low through 2022—does not mean that this will continue in the years to come. Sustained higher inflation would ultimately increase Medicare’s projections of growth in the relevant market basket indices, which (except for physician services) would then translate into faster growth in Medicare’s nominal prices. On the other hand, if growth in input costs does soon return to normal, then growth in Medicare’s prices is likely to remain subdued; as noted above, Medicare’s systems for determining annual payment updates generally do not account for prior forecast errors, so Medicare’s prices will not experience significant “catch-up” growth. A corollary is that the real prices Medicare pays for most health care services will remain on a permanently lower trajectory than they would have been if the current period of elevated inflation had not occurred (unless Congress intervenes to make offsetting changes).

How will economy-wide increases in prices and wages affect other payers?

Medicare is the single largest health care purchaser in the United States, but only accounts for around one-quarter of total spending on health care services.[8] However, as depicted in Panels C and D of Figure 3, the prices paid by state Medicaid programs and private insurers also continue to grow relatively slowly, although growth in private insurers’ prices picked up modestly over the course of 2021. This raises the question of why increases in input costs are not driving these payers’ prices higher.

In Medicaid, this may partially reflect linkages with Medicare’s prices. In some instances, states specify payment rates as a percentage of Medicare’s prices.[9] Moreover, for all states, aggregate Medicaid payments to institutional providers (e.g., hospitals) cannot exceed what Medicare would have paid, and these limits appear to sometimes bind. Even where states set prices independently of Medicare, the administrative or legislative processes that they use may still have features that cause prices to respond incompletely to changes in input costs (e.g., inattention to input costs or reliance on projections).[10]

The continued moderate growth of prices paid by private insurers is perhaps more surprising. Those prices are typically determined through decentralized negotiations between insurers and health care providers, and an increase in the overall price level should, in theory, allow providers to negotiate commensurately higher prices. One potential explanation for why this has not happened is that provider-insurer contracts are only periodically renegotiated and most of those renegotiations have not yet occurred. Another potential explanation is that sluggish growth in Medicare’s prices is having direct effect on private prices, as there is empirical evidence that changes in Medicare rates often cause private rates to move in the same direction. Most strikingly, research by Jeffrey Clemens and Joshua Gottlieb examined an episode where Medicare increased its physician payment rates in some geographic areas and reduced them in others; they found that when Medicare’s prices rose, private insurers’ prices rose roughly dollar-for-dollar. Other work has found directionally similar, albeit quantitatively smaller, effects for hospital prices.[11]

Under most of the potential explanations reviewed above, sustained higher inflation would ultimately result in faster growth in Medicaid and private insurance prices, paralleling the outlook for Medicare’s prices. However, unlike in Medicare, there may be some scope for “catch-up” growth in these payers’ prices in the coming years. Catch-up growth would be likely if the slow growth to date partly reflects lags in renegotiating provider-insurer contracts. On the other hand, to the extent that the current slow growth in Medicaid and private prices is caused by slow growth in Medicare prices, then the lack of catch-up growth in Medicare might translate into a lack of catch-up growth for these payers as well.

What will these price trends mean for the health care system?

The analysis above indicates that the prices received by health care providers are rising more slowly than providers’ input costs and that those prices may not fully “catch up” with input costs in the years to come, particularly in Medicare. While this will reduce burdens on those who pay for health care (some combination of governments, employers, and consumers), it will force providers to either accept lower margins or reduce their costs. These responses could have implications for quality or access.

Assessing whether this reduction in the real prices of health care services is a good thing or a bad thing is beyond the scope of this piece, but it will fundamentally depend on whether prices were too high or too low to start with, a topic of vehement debate. The answer to this question is also likely to differ by payer and service line. For example, reductions in the real prices Medicaid pays for physician services might be of particular concern given the longstanding challenges that Medicaid enrollees face in accessing physician services. By contrast, reductions in the prices that private insurers pay for hospital services might elicit less concern since those prices are far above hospitals’ marginal cost of delivering services.

What does this mean for aggregate inflation?

Because health care services account for 16% of all personal consumption expenditures (PCE), trends in health care prices have modest implications for overall inflation, at least as measured by the PCE price index. The analysis presented above implies that, if the actual increase in input cost growth had been fully reflected in Medicare’s payment updates, then payment updates for fiscal year 2022 would have been around 2.5 percentage points larger.[12] This increase in Medicare’s payments would mechanically increase the overall PCE price index by about 0.1 percentage points. If prices of all health care services were 2.5 percentage points higher, that would increase the PCE price index by 0.4 percentage points.

Higher health care prices would have a smaller effect on the Consumer Price Index (CPI) than on the PCE price index. The CPI encompasses only health care directly paid for by consumers via premiums and cost-sharing and, thus, excludes amounts paid for by governments through Medicare or Medicaid, as well as amounts paid for by employers under employer-sponsored plans. As a result, health care services account for just 6% of the CPI-U basket, far below the 16% weight they hold in the PCE price index.[13]

Importantly, the calculations above capture only the mechanical effects of changes in the prices of health care services. In a counterfactual world in which health care prices were higher, economic actors might change their behavior in ways that would change the overall price level. First, health care providers (or their owners) would receive higher revenue, while those who pay for health care would incur higher costs; to the extent that providers have a different propensity to consume than payers, this could affect aggregate demand and, in turn, the overall price level. Second, higher health care prices might cause consumers to substitute away from health care toward other goods and services, which would put upward pressure on the prices of those other products. Third, higher health care prices would raise employers’ cost of providing health insurance; to the extent that wages, premiums, and plan designs are fixed in the short run, this would tend to increase compensation costs and put upward pressure on prices.

Estimating the size of these general equilibrium effects is behind the scope of this piece. However, the effect of the first channel enumerated above seems likely to be relatively small in this instance; in the short run, wages, premiums, and plan designs are largely fixed, so the burden of higher health care prices would fall primarily on governments and employers rather than consumers. (Even in the long run, a substantial fraction would fall on governments since essentially all health insurance is either provided by public programs or subsidized through the tax system.) This fact likely mutes the aggregate demand consequences of the shift in purchasing power from payers to providers caused by higher prices. Since the other two channels enumerated above seem likely to reinforce the upward pressure on the price level from higher health care prices, this suggests that the effect on the equilibrium price level is unlikely to be substantially smaller (and could be larger) than the mechanical effect.

The Brookings Institution is financed through the support of a diverse array of foundations, corporations, governments, individuals, as well as an endowment. A list of donors can be found in our annual reports published online here. The findings, interpretations, and conclusions in this report are solely those of its author(s) and are not influenced by any donation.

Footnotes:

[1] The Bureau of Economic Analysis health care services category does not encompass all types of health care. Notably, it excludes retail prescription drugs and durable medical equipment.

[2] Nearly half of Medicare enrollees now receive coverage through private Medicare Advantage plans rather than traditional Medicare. Medicare Advantage plans determine the prices they pay for health care services via negotiations with providers, so these prices could deviate from traditional Medicare’s prices in principle. However, because of features of the institutional environment, the prices Medicare Advantage plans pay for most services closely track traditional Medicare’s, so I focus exclusively on traditional Medicare’s prices here.

[3] This estimate was derived from the 2020 Medicare Trustees Report. This estimate reflects only the Medicare program’s payments for these services and excludes patient cost-sharing payments. Including cost-sharing payment might increase this share slightly.

[4] For most services, the update is the projected percentage change in the market basket index, minus a “productivity adjustment” that equals the average percentage point change in economy-wide multifactor productivity over the preceding ten years. Some types of care that are typically included in the “health care services” category, including laboratory tests and physician-administered drugs, use different update methods.

[5] Depending on the payment system, a “year” is sometimes a federal fiscal year and sometimes a calendar year. Additionally, the time period for which Medicare establishes payment rates does not always align with the time period for which it calculates the change in the market basket. For example, Medicare’s outpatient prospective payment system establishes payments on a calendar year basis, but annual updates are based on the increase in the inpatient prospective payment system market basket, which is calculated on a fiscal year basis.

[6] For home health services, projections are finalized in the third quarter rather than the second quarter.

[7] Some payment systems do allow for a forecast error correction. These include the skilled nursing facility prospective payment system as well as the small capital portion of the inpatient prospective payment system.

[8] According to the National Health Expenditure Accounts, Medicare directly paid for 24% of health care services (defined here as personal health care less retail outlet sales of medical products) in 2019. Accounting for associated cost-sharing payments would push Medicare’s share of total spending modestly above one-quarter.

[9] These types of explicit linkages with Medicare rates also exist in some federal programs. The Department of Defense’s TRICARE program generally pays Medicare prices for health care services, and the Department of Veterans Affairs does the same for care delivered outside its facilities.

[10] Around half of Medicaid spending now occurs through managed care plans, rather than states’ traditional fee-for-service programs. In principle, one might expect the prices paid by managed care plans to evolve independently of states’ fee-for-service prices and, perhaps, to take greater account of changes in input costs. However, plan capitation rates are often set at least in part based on fee-for-service costs, and states sometimes require managed care plans to pay no less than fee-for service prices. One study of five state programs focused on hospital care found that this often results in managed care prices being very close to fee-for-service prices, echoing the close concordance observed between the prices paid by Medicare Advantage plans and traditional Medicare.

[11] It is not completely clear why private prices sometimes move in tandem with Medicare’s prices. In the short run, this may be because some contracts directly specify prices as a percentage of Medicare prices. Over the long run, it could be because treating Medicare patients is many providers’ “outside option,” so lower Medicare rates reduce providers’ leverage in negotiations with private insurers. Alternatively, the financial pressure created by lower Medicare rates could lead providers to reduce their (marginal) costs, which in turn lowers private prices.

[12] Specifically, averaging the two scenarios depicted in Figure 2 implies that the inpatient market basket index will grow by 4.7% in fiscal year 2022, which is 2.5 percentage points higher than the 2.2% average growth observed in fiscal years 2015 through 2019. But projected growth for fiscal year 2022 was almost exactly equal to average projected growth for fiscal year 2015 through 2019, so none of the actual uptick in input cost growth was reflected in Medicare’s projection. Calculations for Medicare’s other payment systems would likely be similar.

[13] The CPI “medical care services” category includes health insurance services, while the PCE “health care services” category does not. For comparability, this 6% figure excludes the weight the CPI assigns to health insurance.

Read More

Related Topics:
Continue Reading

Government

Rand Paul Teases Senate GOP Leader Run – Musk Says “I Would Support”

Rand Paul Teases Senate GOP Leader Run – Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump…

Published

1 hour ago

on

March 10, 2024

By

Rand Paul Teases Senate GOP Leader Run - Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump into the race to become the next Senate GOP leader, and Elon Musk was quick to support the idea. Republicans must find a successor for periodically malfunctioning Mitch McConnell, who recently announced he'll step down in November, though intending to keep his Senate seat until his term ends in January 2027, when he'd be within weeks of turning 86. 

So far, the announced field consists of two quintessential establishment types: John Cornyn of Texas and John Thune of South Dakota. While John Barrasso's name had been thrown around as one of "The Three Johns" considered top contenders, the Wyoming senator on Tuesday said he'll instead seek the number two slot as party whip. 

Paul used X to tease his potential bid for the position which -- if the GOP takes back the upper chamber in November -- could graduate from Minority Leader to Majority Leader. He started by telling his 5.1 million followers he'd had lots of people asking him about his interest in running...

...then followed up with a poll in which he predictably annihilated Cornyn and Thune, taking a 96% share as of Friday night, with the other two below 2% each. 

Elon Musk was quick to back the idea of Paul as GOP leader, while daring Cornyn and Thune to follow Paul's lead by throwing their names out for consideration by the Twitter-verse X-verse. 

Paul has been a stalwart opponent of security-state mass surveillance, foreign interventionism -- to include shoveling billions of dollars into the proxy war in Ukraine -- and out-of-control spending in general. He demonstrated the latter passion on the Senate floor this week as he ridiculed the latest kick-the-can spending package:   

In February, Paul used Senate rules to force his colleagues into a grueling Super Bowl weekend of votes, as he worked to derail a $95 billion foreign aid bill. "I think we should stay here as long as it takes,” said Paul. “If it takes a week or a month, I’ll force them to stay here to discuss why they think the border of Ukraine is more important than the US border.”

Don't expect a Majority Leader Paul to ditch the filibuster -- he's been a hardy user of the legislative delay tactic. In 2013, he spoke for 13 hours to fight the nomination of John Brennan as CIA director. In 2015, he orated for 10-and-a-half-hours to oppose extension of the Patriot Act. 

Rand Paul amid his 10 1/2 hour filibuster in 2015

Among the general public, Paul is probably best known as Capitol Hill's chief tormentor of Dr. Anthony Fauci, who was director of the National Institute of Allergy and Infectious Disease during the Covid-19 pandemic. Paul says the evidence indicates the virus emerged from China's Wuhan Institute of Virology. He's accused Fauci and other members of the US government public health apparatus of evading questions about their funding of the Chinese lab's "gain of function" research, which takes natural viruses and morphs them into something more dangerous. Paul has pointedly said that Fauci committed perjury in congressional hearings and that he belongs in jail "without question."   

Musk is neither the only nor the first noteworthy figure to back Paul for party leader. Just hours after McConnell announced his upcoming step-down from leadership, independent 2024 presidential candidate Robert F. Kennedy, Jr voiced his support: 

In a testament to the extent to which the establishment recoils at the libertarian-minded Paul, mainstream media outlets -- which have been quick to report on other developments in the majority leader race -- pretended not to notice that Paul had signaled his interest in the job. More than 24 hours after Paul's test-the-waters tweet-fest began, not a single major outlet had brought it to the attention of their audience. 

That may be his strongest endorsement yet. 

Tyler Durden Sun, 03/10/2024 - 20:25

Read More

Continue Reading

Government

The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While “Waiting” For Deporation, Asylum

The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several…

Published

3 hours ago

on

March 10, 2024

By

The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several months we've pointed out that there has  been zero job creation for native-born workers since the summer of 2018...

... and that since Joe Biden was sworn into office, most of the post-pandemic job gains the administration continuously brags about have gone foreign-born (read immigrants, mostly illegal ones) workers.

And while the left might find this data almost as verboten as FBI crime statistics - as it directly supports the so-called "great replacement theory" we're not supposed to discuss - it also coincides with record numbers of illegal crossings into the United States under Biden.

In short, the Biden administration opened the floodgates, 10 million illegal immigrants poured into the country, and most of the post-pandemic "jobs recovery" went to foreign-born workers, of which illegal immigrants represent the largest chunk.

Asylum seekers from Venezuela await work permits on June 28, 2023 (via the Chicago Tribune)

'But Tyler, illegal immigrants can't possibly work in the United States whilst awaiting their asylum hearings,' one might hear from the peanut gallery. On the contrary: ever since Biden reversed a key aspect of Trump's labor policies, all illegal immigrants - even those awaiting deportation proceedings - have been given carte blanche to work while awaiting said proceedings for up to five years...

... something which even Elon Musk was shocked to learn.

Which leads us to another question: recall that the primary concern for the Biden admin for much of 2022 and 2023 was soaring prices, i.e., relentless inflation in general, and rising wages in particular, which in turn prompted even Goldman to admit two years ago that the diabolical wage-price spiral had been unleashed in the US (diabolical, because nothing absent a major economic shock, read recession or depression, can short-circuit it once it is in place).

Well, there is one other thing that can break the wage-price spiral loop: a flood of ultra-cheap illegal immigrant workers. But don't take our word for it: here is Fed Chair Jerome Powell himself during his February 60 Minutes interview:

PELLEY: Why was immigration important?

POWELL: Because, you know, immigrants come in, and they tend to work at a rate that is at or above that for non-immigrants. Immigrants who come to the country tend to be in the workforce at a slightly higher level than native Americans do. But that's largely because of the age difference. They tend to skew younger.

PELLEY: Why is immigration so important to the economy?

POWELL: Well, first of all, immigration policy is not the Fed's job. The immigration policy of the United States is really important and really much under discussion right now, and that's none of our business. We don't set immigration policy. We don't comment on it.

I will say, over time, though, the U.S. economy has benefited from immigration. And, frankly, just in the last, year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.

PELLEY: The country needed the workers.

POWELL: It did. And so, that's what's been happening.

Translation: Immigrants work hard, and Americans are lazy. But much more importantly, since illegal immigrants will work for any pay, and since Biden's Department of Homeland Security, via its Citizenship and Immigration Services Agency, has made it so illegal immigrants can work in the US perfectly legally for up to 5 years (if not more), one can argue that the flood of illegals through the southern border has been the primary reason why inflation - or rather mostly wage inflation, that all too critical component of the wage-price spiral  - has moderated in in the past year, when the US labor market suddenly found itself flooded with millions of perfectly eligible workers, who just also happen to be illegal immigrants and thus have zero wage bargaining options.

None of this is to suggest that the relentless flood of immigrants into the US is not also driven by voting and census concerns - something Elon Musk has been pounding the table on in recent weeks, and has gone so far to call it "the biggest corruption of American democracy in the 21st century", but in retrospect, one can also argue that the only modest success the Biden admin has had in the past year - namely bringing inflation down from a torrid 9% annual rate to "only" 3% - has also been due to the millions of illegals he's imported into the country.

We would be remiss if we didn't also note that this so often carries catastrophic short-term consequences for the social fabric of the country (the Laken Riley fiasco being only the latest example), not to mention the far more dire long-term consequences for the future of the US - chief among them the trillions of dollars in debt the US will need to incur to pay for all those new illegal immigrants Democrat voters and low-paid workers. This is on top of the labor revolution that will kick in once AI leads to mass layoffs among high-paying, white-collar jobs, after which all those newly laid off native-born workers hoping to trade down to lower paying (if available) jobs will discover that hardened criminals from Honduras or Guatemala have already taken them, all thanks to Joe Biden.

Tyler Durden Sun, 03/10/2024 - 19:15

Read More

Continue Reading

International

‘I couldn’t stand the pain’: the Turkish holiday resort that’s become an emergency dental centre for Britons who can’t get treated at home

The crisis in NHS dentistry is driving increasing numbers abroad for treatment. Here are some of their stories.

Published

4 hours ago

on

March 10, 2024

By

This clinic in the Turkish resort of Antalya is the official 'dental sponsor' of the Miss England competition. Diana Ibanez-Tirado, Author provided

It’s a hot summer day in the Turkish city of Antalya, a Mediterranean resort with golden beaches, deep blue sea and vibrant nightlife. The pool area of the all-inclusive resort is crammed with British people on sun loungers – but they aren’t here for a holiday. This hotel is linked to a dental clinic that organises treatment packages, and most of these guests are here to see a dentist.

From Norwich, two women talk about gums and injections. A man from Wales holds a tissue close to his mouth and spits blood – he has just had two molars extracted.

The dental clinic organises everything for these dental “tourists” throughout their treatment, which typically lasts from three to 15 days. The stories I hear of what has caused them to travel to Turkey are strikingly similar: all have struggled to secure dental treatment at home on the NHS.

“The hotel is nice and some days I go to the beach,” says Susan*, a hairdresser in her mid-30s from Norwich. “But really, we aren’t tourists like in a proper holiday. We come here because we have no choice. I couldn’t stand the pain.”

Seaside beach resort with mountains in the distance
The Turkish Mediterranean resort of Antalya. Akimov Konstantin/Shutterstock

This is Susan’s second visit to Antalya. She explains that her ordeal started two years earlier:

I went to an NHS dentist who told me I had gum disease … She did some cleaning to my teeth and gums but it got worse. When I ate, my teeth were moving … the gums were bleeding and it was very painful. I called to say I was in pain but the clinic was not accepting NHS patients any more.

The only option the dentist offered Susan was to register as a private patient:

I asked how much. They said £50 for x-rays and then if the gum disease got worse, £300 or so for extraction. Four of them were moving – imagine: £1,200 for losing your teeth! Without teeth I’d lose my clients, but I didn’t have the money. I’m a single mum. I called my mum and cried.

Susan’s mother told her about a friend of hers who had been to Turkey for treatment, then together they found a suitable clinic:

The prices are so much cheaper! Tooth extraction, x-rays, consultations – it all comes included. The flight and hotel for seven days cost the same as losing four teeth in Norwich … I had my lower teeth removed here six months ago, now I’ve got implants … £2,800 for everything – hotel, transfer, treatments. I only paid the flights separately.

In the UK, roughly half the adult population suffers from periodontitis – inflammation of the gums caused by plaque bacteria that can lead to irreversible loss of gums, teeth, and bone. Regular reviews by a dentist or hygienist are required to manage this condition. But nine out of ten dental practices cannot offer NHS appointments to new adult patients, while eight in ten are not accepting new child patients.

Some UK dentists argue that Britons who travel abroad for treatment do so mainly for cosmetic procedures. They warn that dental tourism is dangerous, and that if their treatment goes wrong, dentists in the UK will be unable to help because they don’t want to be responsible for further damage. Susan shrugs this off:

Dentists in England say: ‘If you go to Turkey, we won’t touch you [afterwards].’ But I don’t worry because there are no appointments at home anyway. They couldn’t help in the first place, and this is why we are in Turkey.

‘How can we pay all this money?’

As a social anthropologist, I travelled to Turkey a number of times in 2023 to investigate the crisis of NHS dentistry, and the journeys abroad that UK patients are increasingly making as a result. I have relatives in Istanbul and have been researching migration and trading patterns in Turkey’s largest city since 2016.

In August 2023, I visited the resort in Antalya, nearly 400 miles south of Istanbul. As well as Susan, I met a group from a village in Wales who said there was no provision of NHS dentistry back home. They had organised a two-week trip to Turkey: the 12-strong group included a middle-aged couple with two sons in their early 20s, and two couples who were pensioners. By going together, Anya tells me, they could support each other through their different treatments:

I’ve had many cavities since I was little … Before, you could see a dentist regularly – you didn’t even think about it. If you had pain or wanted a regular visit, you phoned and you went … That was in the 1990s, when I went to the dentist maybe every year.

Anya says that once she had children, her family and work commitments meant she had no time to go to the dentist. Then, years later, she started having serious toothache:

Every time I chewed something, it hurt. I ate soups and soft food, and I also lost weight … Even drinking was painful – tea: pain, cold water: pain. I was taking paracetamol all the time! I went to the dentist to fix all this, but there were no appointments.

Anya was told she would have to wait months, or find a dentist elsewhere:

A private clinic gave me a list of things I needed done. Oh my God, almost £6,000. My husband went too – same story. How can we pay all this money? So we decided to come to Turkey. Some people we know had been here, and others in the village wanted to come too. We’ve brought our sons too – they also need to be checked and fixed. Our whole family could be fixed for less than £6,000.

By the time they travelled, Anya’s dental problems had turned into a dental emergency. She says she could not live with the pain anymore, and was relying on paracetamol.

In 2023, about 6 million adults in the UK experienced protracted pain (lasting more than two weeks) caused by toothache. Unintentional paracetamol overdose due to dental pain is a significant cause of admissions to acute medical units. If left untreated, tooth infections can spread to other parts of the body and cause life-threatening complications – and on rare occasions, death.

In February 2024, police were called to manage hundreds of people queuing outside a newly opened dental clinic in Bristol, all hoping to be registered or seen by an NHS dentist. One in ten Britons have admitted to performing “DIY dentistry”, of which 20% did so because they could not find a timely appointment. This includes people pulling out their teeth with pliers and using superglue to repair their teeth.

In the 1990s, dentistry was almost entirely provided through NHS services, with only around 500 solely private dentists registered. Today, NHS dentist numbers in England are at their lowest level in a decade, with 23,577 dentists registered to perform NHS work in 2022-23, down 695 on the previous year. Furthermore, the precise division of NHS and private work that each dentist provides is not measured.

The COVID pandemic created longer waiting lists for NHS treatment in an already stretched public service. In Bridlington, Yorkshire, people are now reportedly having to wait eight-to-nine years to get an NHS dental appointment with the only remaining NHS dentist in the town.

In his book Patients of the State (2012), Argentine sociologist Javier Auyero describes the “indignities of waiting”. It is the poor who are mostly forced to wait, he writes. Queues for state benefits and public services constitute a tangible form of power over the marginalised. There is an ethnic dimension to this story, too. Data suggests that in the UK, patients less likely to be effective in booking an NHS dental appointment are non-white ethnic groups and Gypsy or Irish travellers, and that it is particularly challenging for refugees and asylum-seekers to access dental care.

This article is part of Conversation Insights
The Insights team generates long-form journalism derived from interdisciplinary research. The team is working with academics from different backgrounds who have been engaged in projects aimed at tackling societal and scientific challenges.

In 2022, I experienced my own dental emergency. An infected tooth was causing me debilitating pain, and needed root canal treatment. I was advised this would cost £71 on the NHS, plus £307 for a follow-up crown – but that I would have to wait months for an appointment. The pain became excruciating – I could not sleep, let alone wait for months. In the same clinic, privately, I was quoted £1,300 for the treatment (more than half my monthly income at the time), or £295 for a tooth extraction.

I did not want to lose my tooth because of lack of money. So I bought a flight to Istanbul immediately for the price of the extraction in the UK, and my tooth was treated with root canal therapy by a private dentist there for £80. Including the costs of travelling, the total was a third of what I was quoted to be treated privately in the UK. Two years on, my treated tooth hasn’t given me any more problems.

A better quality of life

Not everyone is in Antalya for emergency procedures. The pensioners from Wales had contacted numerous clinics they found on the internet, comparing prices, treatments and hotel packages at least a year in advance, in a carefully planned trip to get dental implants – artificial replacements for tooth roots that help support dentures, crowns and bridges.

Street view of a dental clinic in Antalya, Turkey
Dental clinic in Antalya, Turkey. Diana Ibanez-Tirado, CC BY-NC-ND

In Turkey, all the dentists I speak to (most of whom cater mainly for foreigners, including UK nationals) consider implants not a cosmetic or luxurious treatment, but a development in dentistry that gives patients who are able to have the procedure a much better quality of life. This procedure is not available on the NHS for most of the UK population, and the patients I meet in Turkey could not afford implants in private clinics back home.

Paul is in Antalya to replace his dentures, which have become uncomfortable and irritating to his gums, with implants. He says he couldn’t find an appointment to see an NHS dentist. His wife Sonia went through a similar procedure the year before and is very satisfied with the results, telling me: “Why have dentures that you need to put in a glass overnight, in the old style? If you can have implants, I say, you’re better off having them.”

Most of the dental tourists I meet in Antalya are white British: this city, known as the Turkish Riviera, has developed an entire economy catering to English-speaking tourists. In 2023, more than 1.3 million people visited the city from the UK, up almost 15% on the previous year.

Read more: NHS dentistry is in crisis – are overseas dentists the answer?

In contrast, the Britons I meet in Istanbul are predominantly from a non-white ethnic background. Omar, a pensioner of Pakistani origin in his early 70s, has come here after waiting “half a year” for an NHS appointment to fix the dental bridge that is causing him pain. Omar’s son had been previously for a hair transplant, and was offered a free dental checkup by the same clinic, so he suggested it to his father. Having worked as a driver for a manufacturing company for two decades in Birmingham, Omar says he feels disappointed to have contributed to the British economy for so long, only to be “let down” by the NHS:

At home, I must wait and wait and wait to get a bridge – and then I had many problems with it. I couldn’t eat because the bridge was uncomfortable and I was in pain, but there were no appointments on the NHS. I asked a private dentist and they recommended implants, but they are far too expensive [in the UK]. I started losing weight, which is not a bad thing at the beginning, but then I was worrying because I couldn’t chew and eat well and was losing more weight … Here in Istanbul, I got dental implants – US$500 each, problem solved! In England, each implant is maybe £2,000 or £3,000.

In the waiting area of another clinic in Istanbul, I meet Mariam, a British woman of Iraqi background in her late 40s, who is making her second visit to the dentist here. Initially, she needed root canal therapy after experiencing severe pain for weeks. Having been quoted £1,200 in a private clinic in outer London, Mariam decided to fly to Istanbul instead, where she was quoted £150 by a dentist she knew through her large family. Even considering the cost of the flight, Mariam says the decision was obvious:

Dentists in England are so expensive and NHS appointments so difficult to find. It’s awful there, isn’t it? Dentists there blamed me for my rotten teeth. They say it’s my fault: I don’t clean or I ate sugar, or this or that. I grew up in a village in Iraq and didn’t go to the dentist – we were very poor. Then we left because of war, so we didn’t go to a dentist … When I arrived in London more than 20 years ago, I didn’t speak English, so I still didn’t go to the dentist … I think when you move from one place to another, you don’t go to the dentist unless you are in real, real pain.

In Istanbul, Mariam has opted not only for the urgent root canal treatment but also a longer and more complex treatment suggested by her consultant, who she says is a renowned doctor from Syria. This will include several extractions and implants of back and front teeth, and when I ask what she thinks of achieving a “Hollywood smile”, Mariam says:

Who doesn’t want a nice smile? I didn’t come here to be a model. I came because I was in pain, but I know this doctor is the best for implants, and my front teeth were rotten anyway.

Dentists in the UK warn about the risks of “overtreatment” abroad, but Mariam appears confident that this is her opportunity to solve all her oral health problems. Two of her sisters have already been through a similar treatment, so they all trust this doctor.

Alt text
An Istanbul clinic founded by Afghan dentists has a message for its UK customers. Diana Ibanez-Tirado, CC BY-NC-ND

The UK’s ‘dental deserts’

To get a fuller understanding of the NHS dental crisis, I’ve also conducted 20 interviews in the UK with people who have travelled or were considering travelling abroad for dental treatment.

Joan, a 50-year-old woman from Exeter, tells me she considered going to Turkey and could have afforded it, but that her back and knee problems meant she could not brave the trip. She has lost all her lower front teeth due to gum disease and, when I meet her, has been waiting 13 months for an NHS dental appointment. Joan tells me she is living in “shame”, unable to smile.

In the UK, areas with extremely limited provision of NHS dental services – known as as “dental deserts” – include densely populated urban areas such as Portsmouth and Greater Manchester, as well as many rural and coastal areas.

In Felixstowe, the last dentist taking NHS patients went private in 2023, despite the efforts of the activist group Toothless in Suffolk to secure better access to NHS dentists in the area. It’s a similar story in Ripon, Yorkshire, and in Dumfries & Galloway, Scotland, where nearly 25,000 patients have been de-registered from NHS dentists since 2021.

Data shows that 2 million adults must travel at least 40 miles within the UK to access dental care. Branding travel for dental care as “tourism” carries the risk of disguising the elements of duress under which patients move to restore their oral health – nationally and internationally. It also hides the immobility of those who cannot undertake such journeys.

The 90-year-old woman in Dumfries & Galloway who now faces travelling for hours by bus to see an NHS dentist can hardly be considered “tourism” – nor the Ukrainian war refugees who travelled back from West Sussex and Norwich to Ukraine, rather than face the long wait to see an NHS dentist.

Many people I have spoken to cannot afford the cost of transport to attend dental appointments two hours away – or they have care responsibilities that make it impossible. Instead, they are forced to wait in pain, in the hope of one day securing an appointment closer to home.

Billboard advertising a dental clinic in Turkey
Dental clinics have mushroomed in recent years in Turkey, thanks to the influx of foreign patients seeking a wide range of treatments. Diana Ibanez-Tirado, CC BY-NC-ND

‘Your crisis is our business’

The indignities of waiting in the UK are having a big impact on the lives of some local and foreign dentists in Turkey. Some neighbourhoods are rapidly changing as dental and other health clinics, usually in luxurious multi-storey glass buildings, mushroom. In the office of one large Istanbul medical complex with sections for hair transplants and dentistry (plus one linked to a hospital for more extensive cosmetic surgery), its Turkish owner and main investor tells me:

Your crisis is our business, but this is a bazaar. There are good clinics and bad clinics, and unfortunately sometimes foreign patients do not know which one to choose. But for us, the business is very good.

This clinic only caters to foreign patients. The owner, an architect by profession who also developed medical clinics in Brazil, describes how COVID had a major impact on his business:

When in Europe you had COVID lockdowns, Turkey allowed foreigners to come. Many people came for ‘medical tourism’ – we had many patients for cosmetic surgery and hair transplants. And that was when the dental business started, because our patients couldn’t see a dentist in Germany or England. Then more and more patients started to come for dental treatments, especially from the UK and Ireland. For them, it’s very, very cheap here.

The reasons include the value of the Turkish lira relative to the British pound, the low cost of labour, the increasing competition among Turkish clinics, and the sheer motivation of dentists here. While most dentists catering to foreign patients are from Turkey, others have arrived seeking refuge from war and violence in Syria, Iraq, Afghanistan, Iran and beyond. They work diligently to rebuild their lives, careers and lost wealth.

Regardless of their origin, all dentists in Turkey must be registered and certified. Hamed, a Syrian dentist and co-owner of a new clinic in Istanbul catering to European and North American patients, tells me:

I know that you say ‘Syrian’ and people think ‘migrant’, ‘refugee’, and maybe think ‘how can this dentist be good?’ – but Syria, before the war, had very good doctors and dentists. Many of us came to Turkey and now I have a Turkish passport. I had to pass the exams to practise dentistry here – I study hard. The exams are in Turkish and they are difficult, so you cannot say that Syrian doctors are stupid.

Hamed talks excitedly about the latest technology that is coming to his profession: “There are always new materials and techniques, and we cannot stop learning.” He is about to travel to Paris to an international conference:

I can say my techniques are very advanced … I bet I put more implants and do more bone grafting and surgeries every week than any dentist you know in England. A good dentist is about practice and hand skills and experience. I work hard, very hard, because more and more patients are arriving to my clinic, because in England they don’t find dentists.

Dental equipment in a Turkish treatment room
Dentists in Turkey boast of using the latest technology. Diana Ibanez-Tirado, CC BY-NC-ND

While there is no official data about the number of people travelling from the UK to Turkey for dental treatment, investors and dentists I speak to consider that numbers are rocketing. From all over the world, Turkey received 1.2 million visitors for “medical tourism” in 2022, an increase of 308% on the previous year. Of these, about 250,000 patients went for dentistry. One of the most renowned dental clinics in Istanbul had only 15 British patients in 2019, but that number increased to 2,200 in 2023 and is expected to reach 5,500 in 2024.

Like all forms of medical care, dental treatments carry risks. Most clinics in Turkey offer a ten-year guarantee for treatments and a printed clinical history of procedures carried out, so patients can show this to their local dentists and continue their regular annual care in the UK. Dental treatments, checkups and maintaining a good oral health is a life-time process, not a one-off event.

Many UK patients, however, are caught between a rock and a hard place – criticised for going abroad, yet unable to get affordable dental care in the UK before and after their return. The British Dental Association has called for more action to inform these patients about the risks of getting treated overseas – and has warned UK dentists about the legal implications of treating these patients on their return. But this does not address the difficulties faced by British patients who are being forced to go abroad in search of affordable, often urgent dental care.

A global emergency

The World Health Organization states that the explosion of oral disease around the world is a result of the “negligent attitude” that governments, policymakers and insurance companies have towards including oral healthcare under the umbrella of universal healthcare. It as if the health of our teeth and mouth is optional; somehow less important than treatment to the rest of our body. Yet complications from untreated tooth decay can lead to hospitalisation.

The main causes of oral health diseases are untreated tooth decay, severe gum disease, toothlessness, and cancers of the lip and oral cavity. Cases grew during the pandemic, when little or no attention was paid to oral health. Meanwhile, the global cosmetic dentistry market is predicted to continue growing at an annual rate of 13% for the rest of this decade, confirming the strong relationship between socioeconomic status and access to oral healthcare.

In the UK since 2018, there have been more than 218,000 admissions to hospital for rotting teeth, of which more than 100,000 were children. Some 40% of children in the UK have not seen a dentist in the past 12 months. The role of dentists in prevention of tooth decay and its complications, and in the early detection of mouth cancer, is vital. While there is a 90% survival rate for mouth cancer if spotted early, the lack of access to dental appointments is causing cases to go undetected.

The reasons for the crisis in NHS dentistry are complex, but include: the real-term cuts in funding to NHS dentistry; the challenges of recruitment and retention of dentists in rural and coastal areas; pay inequalities facing dental nurses, most of them women, who are being badly hit by the cost of living crisis; and, in England, the 2006 Dental Contract that does not remunerate dentists in a way that encourages them to continue seeing NHS patients.

The UK is suffering a mass exodus of the public dentistry workforce, with workers leaving the profession entirely or shifting to the private sector, where payments and life-work balance are better, bureaucracy is reduced, and prospects for career development look much better. A survey of general dental practitioners found that around half have reduced their NHS work since the pandemic – with 43% saying they were likely to go fully private, and 42% considering a career change or taking early retirement.

Reversing the UK’s dental crisis requires more commitment to substantial reform and funding than the “recovery plan” announced by Victoria Atkins, the secretary of state for health and social care, on February 7.

The stories I have gathered show that people travelling abroad for dental treatment don’t see themselves as “tourists” or vanity-driven consumers of the “Hollywood smile”. Rather, they have been forced by the crisis in NHS dentistry to seek out a service 1,500 miles away in Turkey that should be a basic, affordable right for all, on their own doorstep.

*Names in this article have been changed to protect the anonymity of the interviewees.

For you: more from our Insights series:

To hear about new Insights articles, join the hundreds of thousands of people who value The Conversation’s evidence-based news. Subscribe to our newsletter.

Diana Ibanez Tirado receives funding from the School of Global Studies, University of Sussex.

Read More

Continue Reading

Trending