Insurance & Benefits

Insurers Changing the Game in Medical Tourism

Insurance & Benefits

Due to the availability of high-quality alternative healthcare abroad at affordable and highly competitive rates, there is a growing demand for healthcare across borders and employers, as well as insurers, are cashing in on this trend in a bid to save cost.

Employees have realized that seeking healthcare services abroad is more cost-effective than seeking same services at home. This is such that even after factoring in travel expenses, accommodation, and sick days off work, patients still get to save more money.

For example, a hip replacement surgery which would cost $75,000 in the US costs $9,000 in India. These financial benefits, according to Patients Beyond Borders, is responsible for the massive drift of Americans to other countries such as Singapore, Thailand, and Turkey to receive healthcare.

Medical travel, which hitherto was the territory of uninsured and under-insured patients, is now being considered by leading insurance companies including Aetna and CIGNA.

Health insurance companies over the world have begun to dive into the medical tourism industry experimenting with cross-border and international medical coverage. The idea of such plans is that insured persons can visit another country to receive specific medical care in a clinic provided in the insurance policy and have the medical expenses reimbursed entirely or partially by the insurance provider. Such programs give patients confidence about the quality of care in the destination country.

Insurance companies use a portion of the substantial savings made from such programs to provide incentives to patients who wish to seek medical care abroad. Some of these incentives include waiving the deductible and out-of-pocket health expenses and covering travel expenses for the patient and a travel companion. Many of these insurance policies have begun to incorporate collaborations with physicians in other parts of the world.

Employers are not left out in the current trend as several Fortune 500 companies, in a bid to cut down on employee healthcare cost, outsource expensive medical procedures to healthcare providers abroad.

One major factor contributing to this paradigm shift is the increasing number of South East Asian and European healthcare facilities that meet the healthcare standards of developed countries such as the United States and Canada.

The standard policies offered by medical tourism companies generally covers healthcare complications, medical evacuation, trip cancellation, acute illnesses, and injuries which may arise during the health travel for the patient and travel companion. However, the packages and coverage limits depend on the policy offered by each insurance company.

The four major insurers in the United States: Aetna, UnitedHealth, WellPoint, and Humana are already taking steps to expand their coverage to include international plans on the basis of affordability of healthcare in foreign countries.

BlueCross BlueShield, an insurance company based in South Carolina, has partnered with health providers in Thailand, Turkey, Singapore, Turkey, and Costa Rica to create low-premium, high-deductible insurance plans, targeted at lower-wage workers who are concerned about saving cost.

Aetna, the largest for-profit healthcare management company in the United States, made collaborations with Apollo hospital, India to create an insurance plan for Americans to receive healthcare treatment at the hospital.

This insurance coverage by Aetna sends employees of Serigraph Inc., a client of Athena WellPoint, to Apollo Hospital for specific routine procedures. The program is scheduled to begin with Apollo Hospitals in Delhi and Bangalore, then to its JCI-approved clinics. Under this insurance plan, all expenses accrued by the patients, including travel and accommodation, will be reimbursed by Athena Wellpoint.

UnitedHealth Group developed a similar program that sees over 200,000 Americans covered through fully-insured, and self-funded health plans travel to Bumrungrad International Hospitals in Thailand and Apollo Hospitals in India.

Blue Shield and Health Net in California also created an insurance program which covers healthcare in Mexican hospitals for US employers who hire a large number of Mexican employees. This program includes over 20,000 patients.

In addition, Blue Cross Blue Shield provides insurance policies to enable and encourage people to travel abroad for low-cost medical procedures that are expensive in their home countries. The healthcare management company has made collaborations with Bumrungrad International Hospitals to provide coverage for medical procedures organized through insurance company Companion Global. The program also covers two follow-up visits with doctors at Doctor Care.

In Europe, this trend has also been making a significant impact on the health tourism market in the continent. Currently, in Ukraine, the European Insurance Alliance offers a program where its insured patient can undergo a comprehensive diagnostic evaluation and treatment in Israel under either the standard package or the VIP package.

In addition, the Ukrainian government has set up legislation to boost medical tourism in Ukraine today. The law notes that travel insurance, consisting of medical and accident insurance, is mandatory and should be carried out on the basis of an agreement between the subjects of such travel activities and their insurers.

In this case, there should be an insurance contract which must be presented to the travel agent before departure. The insurance contract, as stated by the law, shall provide medical care to tourists and reimbursements of the expenses accrued during the period of stay in the country.

One interesting response to this trend in medical tourism is that healthcare facilities in the US, for example, has begun accepting referrals from health travel agencies, providing discounted services to American and non-American patients.

This push in healthcare tourism has a significant impact on healthcare in participating countries. In countries where patients experience long waits before undergoing a medical procedure or treatment, medical tourism offers an initiative to clear such backlogs by referring their patients to international healthcare providers. This is the case with the British National Health Service which refers patients for elective medical procedures to neighboring countries.

This disruption by health insurance companies in the medical tourism industry is taking a rapid turn as technology advances. Digitization has eased payment models and customer care services, allowing for information transparency which drives patients to determine where and how they receive health care.

With over 14 million patients traveling for healthcare yearly, medical tourism is still regarded as a growing industry. However, as advances in technology, as well as better collaborations from insurance companies, persist in global healthcare, medical tourism would grow into a borderless industry.

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