According to a 2008 annual employee health benefits survey conducted by The Henry J. Kaiser Family Foundation, in 2008 employer health insurance premiums increased by 5.0 percent - two times the rate of inflation. The annual premium for an employer health plan covering a family of four averaged nearly $12,700, and the annual premium for single coverage averaged over $4,700. The survey also showed that workers contributed nearly $3,400 or 12 percent more than they did in 2007 to their own healthcare premiums.
The vital need for high-quality and affordable healthcare is driving more and more American consumers to seek treatment outside of the U.S. in order to eliminate their out-of-pocket medical expenses on high-cost surgical procedures. This concept, most commonly referred to as medical travel or global healthcare, is becoming an attractive option for not only uninsured patients, but many individuals with health insurance who are in need of common, cost-prohibitive surgical procedures, but find their out-of-pocket expenses are just too high.
Industry data shows that U.S. employees, on average, are now responsible for contributing over 120 percent more to their own employer-funded health insurance plan since 2000. Average out-of-pocket costs for deductibles, co-payments for medications, and co-insurance for physician and hospital visits, as well, rose 115 percent during the same period.
As an example, in the U.S., a heart-valve replacement can cost anywhere from $80,000-100,000. Meanwhile, in the best-case scenario, even patients with a substantial medical insurance policy can expect to pay as much as $3,500 to $5,000 out of their own pocket in deductibles, hospitalization fees, co-pays, etc. For an individual earning $50,000 a year that could mean the difference between paying your medical bills and making next month’s mortgage payment. A June 2009 Harvard study reported that of all the bankruptcies filed in the U.S. in 2007, 62 percent of those filings had medical debt. What is even more interesting was that 78 percent of that 62 percent (those who filed for bankruptcy) had some type of medical insurance. In turn, when patients are unable to cover the costs of an important medical procedure, treatment is often delayed or even avoided entirely.
In addition to the interest in medical travel among U.S. consumers, there is also a growing interest among the nation’s employers seeking innovative ways to reduce their escalating employee healthcare costs. Individuals going outside the U.S. for surgical procedures can save an average of 40-80 percent when compared to the same procedure performed in the U.S., equating to lower claims cost for the employer and no out-of-pocket expenses for the individual receiving care.
Now there are companies that are taking it one step further by sharing thousands of dollars with their employees who elect to travel internationally for care. One such company, McGregor & Associates, an employee benefits firm in San Diego, will share anywhere between $5,000-$7,000 with their employees that go outside the U.S. for certain covered surgical procedures. McGregor & Associates has added Satori World Medical’s global healthcare network to its available benefit options for clients and employers. Through this program, when participating patients undergo a surgical procedure internationally via the Satori Global Network™, the plan sponsor actually shares a portion of the savings with their employees via a tax-advantaged Health Reimbursement Account. Those savings are then used to fund the employee’s future medical expenses for the next several years.
“In this economic environment, we have to be mindful of company resources, but we cannot ignore our employees’ concerns over coverage and cost,” said George McGregor, President & CEO of McGregor & Associates. “By adding a global healthcare component to our existing coverage, not only are we able to save significant dollars on our company healthcare expense, but we can pass along a portion of that savings to our employees, which makes a real difference in their financial well-being.”
For many individuals, having a medical travel benefit plan may seem like an appealing and cost-effective option to receiving care. But what items should consumers look for when considering a medical travel program?
Quality Assurance: While high-quality care is available at many hospitals around the world, not all medical travel programs offer the same level of quality. Therefore, it is important to ensure that the medical travel company you choose has a robust quality assurance program. For instance, as a baseline, select a medical travel company that only contracts with international hospitals accredited by the Joint Commission International (JCI), an arm of the U.S. hospital-accrediting body, the Joint Commission on Accreditation of Healthcare Organizations (JCAHO). JCI sets over 350 standards of excellence for international hospitals to meet that ensure the quality and safety of patient care.
Out-of-Pocket Costs: Not every medical travel program is all-inclusive. Therefore, it is essential to understand what is included in the cost of your care. For example, does the cost include roundtrip airfare and hotel accommodations? What about travel costs for a companion? Are there any out-of-pocket costs, such as deductibles or co-pays that you may incur?
Current Coverage: There are now medical travel programs available to U.S. employers, which can easily be added as a benefit option to their employees’ existing health plan. Many programs can be added without any recurring cost or network access fee to the employer. Ask your HR manager or benefits advisor if this is a covered benefit. If you don’t already have a medical travel/global benefit option, ask about adding one to your company’s benefit plan design.
Patient Support Systems: Making the decision to receive surgery outside of the U.S. can be a challenging decision. Therefore, it is important to work with a medical travel company that has a strong patient advocacy and support program in place. Specific attributes to look for include access to registered nurses who can guide you through the process in coordinating your care, facilitating your medical records transfer and scheduling your follow-up care with your U.S. physician.
Industry experts agree that medical travel will continue to grow over the next several years. This is particularly true as more U.S. employees become eligible through their employer to receive a meaningful financial reimbursement for electing to go outside the US for their medical care. However, like any healthcare matter, being informed and selective is essential to ensuring your success as a medical traveler.
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