Controversial couple dominates U.S. medical tourism

By Brendan Borrell

NEW YORK (Reuters Health) - These are heady days for the medical tourism industry. With U.S. healthcare prices spiraling upward, more and more insurers and individuals are looking abroad for treatment. By some estimates, 650,000 Americans will check into foreign hospitals from Mexico to Thailand this year.

The boom has created rich opportunities for entrepreneurs catering to first-time medical travelers, start-up businesses and eager hospital managers in developing countries.

Enter lawyer couple Jonathan Edelheit and Renée-Marie Stephano.

Edelheit and Stephano, both 37, are the founders of the Medical Tourism Association (MTA), a non-profit association they created to further "quality of care, transparency, communication and education" in the industry. They are also the organizers of the industry's annual top conference, under way this week in Los Angeles.

In many ways, Edelheit and Stephano have become the face of medical tourism. That has caused admiration, envy and unhappiness in the tight-knit industry.

Former MTA board members and industry colleagues have stories of how their collaborations with the couple have become marred by a sense of disillusionment and legal threats since the organization was founded in 2007. Their concerns center on three issues:

- Edelheit has been accused of selling unauthorized insurance in Washington and Montana. The first probe has been settled. Edelheit dismisses the allegations and says the second investigation will be settled in his favor.

- Edelheit and Stephano have threatened several critics with legal action and have filed one lawsuit against a competing non-profit. Edelheit calls it legal diligence to protect themselves and the MTA's members.

- The couple set up a thriving annual conference, but critics say the profits go into their private corporation rather than the industry association. Edelheit says the arrangement benefits the MTA.

Rudy Rupak of medical tourism facilitator Planet Hospital captured the feelings of many industry players in December when one slide of his Powerpoint presentation said: "The biggest threat to our industry is the MTA."

ALLEGATIONS OF "BOGUS HEALTH PLANS"

Edelheit's foray into health insurance started in 2001 after he left the Villanova University School of Law and moved to Florida to join his father's company, United Group Programs.

As vice president of sales for the company's OptiMed Health Plans, Edelheit says he became the first to sell self-funded employee health plans that included medical travel in 2005. OptiMed's Web site lists companies like Dunkin' Donuts and Chrysler as clients.

The Washington State Insurance Commissioner alleged in 2007 that Edelheit and others had sold or managed "bogus health plans" to 4,000 residents and made "false, deceptive, and misleading representations" to customers between 2003 and 2007. Edelheit, United Group and OptiMed Health were also named in a Montana investigation.

"I have never been so screwed over in my life," one consumer, Judy Bergin, told an investigator with the Washington State Insurance Commissioner. Bergin had found a plan on the Internet later linked to the United Group, made an initial payment of $275 and paid $228 a month thereafter. She said her doctor never got paid, leaving her to foot about $3,000 in medical bills.