The passage of the Patient Protection and Affordable Care Act (PPACA) addresses access, but most health care economists agree that medical expenses will continue to rise. As this happens, more employers will be forced to shift a larger portion of health care costs to their employees in order to remain profitable. Medical travel, which has received increased interest from U.S. residents and employers, is now a highly attractive and viable option to businesses and their employees that may help consumers deal with the increased load that they must bear.
Medical travel defined
The practice of travelling across international borders to obtain health care – medical travel, also known as medical tourism or global health care – has increased significantly in popularity over the past decade. Travelers seek both elective and specialized surgical procedures, such as joint replacement; cardiac, bariatric, and cosmetic procedures; and major dental work.
A number of factors are driving this trend, including:
- The high quality of international medical care and the ability to reduce a U.S. patient’s out-of-pocket expenses for typically high-cost surgical procedures
- The cultural diversity of the US workforce
- The ease of the adoption and integration of global health care benefits into a plan design
Large U.S. employers estimate that their health care benefit costs will increase an average of 8.9 percent in 2011, up from an average increase of 7 percent in 2010, according to an August 2010 survey report by the National Business Group on Health, a nonprofit association of large employers. The survey received responses from 72 of the nation’s largest corporations, representing more than 3.7 million employees.
The survey also showed that more than 60 percent of large employers will offer a consumer-directed health plan (CDHP) in 2011, typically a health savings account (HSA) or a health reimbursement account (HRA).
On average, an international surgical procedure saves 40 to 80 percent over U.S. costs, making medical travel a viable option for businesses and employees to explore.
A handful of medical travel facilitators work directly with employers, health care brokers, and health insurance plans to offer medical travel to the organization’s employees.
It is common to see employers provide a 100 percent benefit to employees who travel for lower-cost medical care by waiving all deductible and out-of-pocket expenses for the surgical procedures. If employers can lower costs by incorporating a medical travel option, many believe that the employee needs to win financially, as well.
One model utilizes an HRA, which allows the consumer to share in the savings for their surgical procedure. This shared savings model can work in concert with an HSA, high-deductible health plan (HDHP), or other plan designs. Under this model, the patient is eligible to have their plan sponsor or employer deposit between $2,000 and $8,000 into a HRA, which is made possible by the lower cost of the surgical procedure through medical travel. The funds deposited are tax-deductible for the employer and tax-free for the employee, and offer the employee access to dollars that can offset future health care expenses.
When seeking potential partners in medical travel, it is imperative to pick a partner that can address both employer and employee solutions.
Key components for which to seek include:
Plan language. The medical travel provider and third-party administrator should be involved in establishing plan language so as to provide clarification of services, eligible claims, and access details to the employer and insurance broker.
Ease of billing. The medical travel company should provide the payor with a single, easy-to-understand final bill that includes the procedure; ancillary services, like hospital stays, anesthesia, etc.; and travel costs.
English. Medical travel can be intimidating to many, so it is important that all services are provided in English. Patients should have access to English-speaking doctors, nurses, and hotel staff, and the final bill should be presented to the payor in English to facilitate ease of payment.
Pre-determined network. The medical travel facilitator should have a predetermined network of hospitals and doctors. The hospitals should be pre-accredited, preferably through Joint Commissions International, or equivalently certified. Patients should be provided access to doctors who are U.S., U.K., or equivalently trained and board certified. Many medical travel companies conduct extensive due diligence on their networks of hospitals and doctors. The review includes mortality rate tracking for specified procedures, thorough CV review of the physicians, and in-person site visits and surgical observation.
Know before you go. Medical travel companies should have fixed prices for each procedure in the selected destination. The prices should also include air travel and hotel accommodations for the patient and a companion for the selected dates of travel.
Travel concierge. Preparing for a surgical procedure can be stressful enough without adding in the element of travel. Medical travel facilitators should handle the entire travel process for the patient, including booking airfare, hotel accommodations, and transportation to and from their hotel and the hospital. These travel services should not incur an additional charge, but should be included in the final cost.
Employee assistance. When traveling abroad for medical care, employees should have access to a U.S. contact at the medical travel company 24 hours a day, seven days a week. That person should be able to help with medical and travel questions.
Safeguards. In the rare event that something should go awry during international travel, or if complications occur after a medical procedure done abroad, the medical travel facilitator should offer additional safeguards to patients. Some companies may include personal accident policies related to the procedure in the overall cost.
The need for quality health care and an additional choice of cost-effective providers will be increasingly necessary in any contemporary employer-sponsored health plan. Every day, health care consumers are becoming more aware of the options that fit their needs in terms of quality, immediacy, value, and cost effectiveness, making medical travel viable option for every health plan.
Keith Mendoza is director of sales for Satori World Medical. He can be reached at 619-704-2000.