Employers and Insurers

In the U.S., since most people are covered under their employers’ insurance programs, employers’ attitudes toward medical tourism have a significant impact on its increase or decrease in popularity. In Europe, each country has national health care, so the state itself provides medical services. Medical tourism in Europe exists for procedures that are not covered by national health care such as plastic surgery and other elective procedures. Therefore, U.S. employers, which are facing increasing pressure to contain health care costs, may be more accepting of the concept of medical tourism (CNN). More than 150,000 North Americans and Europeans.. seek medical treatment overseas year after year. Small businesses, which have struggled the most to continue their health care plans in the face of spiraling costs, may be especially attracted. Employers are discussing medical tourism in executive communities such as LinkedIn (LinkedIn Answers).

Medical Tourism has a powerful political dimension in the U.S. because it is associated with moving jobs offshore. Many political constituencies are vehemently opposed to “outsourcing” or “offshoring” because they perceive it as a threat to “American jobs.” In addition, most Americans have never left the country, and most do not have passports. The idea of foreign travel, especially for medical care, would be upsetting for many people.

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Several companies are experimenting with offering medical tourism options to their employees, even providing cash bonuses in many cases (International Medical Travel Journal). These companies have often been squeezed by escalating costs and have begun to introduce medical tourism as a partial way to contain costs while maintaining health coverage. They are introducing it carefully to avoid angering or upsetting their employees. It is important to explain what the concept is and to have a few employees try it, so they can share their experiences. Finally, employers do not force employees to go offshore, but they usually offer cost incentives.

Hannaford is one such company. It introduced Singapore General Hospital as an option for hip replacement surgery to its 9,000 employees. The company pays business class plane travel for the patient and a significant other. Unlike local care, there are no copay or out of pocket expenses, and it shares the savings with the employee, up to $10,000, a limit that is imposed by the IRS. Global Choice Healthcare is another company that specializes in creating plans for self-insured employers (American Medical News and Global Choice Healthcare).

IndUShealth is a facilitator that arranges health care programs for employers. They target “self-funded” employers, which assume the risk of the insurance because they collect the premium and pay for the services, often outsourcing the administration itself. IndUShealth clients are conducting pilots that introduce medical tourism as an option. They also share cost savings with employees. It is important to be open and honest with employees and to not remove their local care options. In some cases, offering medical tourism threatens their local providers and enables the company to drive down local fees.

Hi-Co added Wockhardt Hospitals in India to its network, and initial patients are happy with the results, and the savings.

Companion Global Health care is a subsidiary of BlueCross BlueShield of South Carolina that facilitates medical tourism in many countries, using its large network. All 12,000 employees of BlueCross have the option of using medical tourism. Three of their business clients have modified their plans to offer medical tourism options. One client has 5,000 employees.

Doctors Care is a client of Companion Global Health care that now allows its employees to use medical tourism for five procedures at 40 locations around the world. They waive the deductible and may pay travel expenses.

Blue Ridge Paper Products is a self-insured company that had planned to send an employee to India for surgery—until its employees found out about it and protested through their congressmen. Employees of the union shop felt too threatened to allow medical tourism, and Blue Ridge had to reverse its plans.

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Blue Shield of California and Health Net offer treatment in Baja California for Southern California members of their plans. Called “Salud con Health Net,” the plans extend significant discounts to employees when they go south of the border for medical care.

United Group Programs Inc., a Florida health insurer, added Bumrungrad Hospital to its network of preferred providers in 2006, saving eighty percent on average on medical costs (Newsweek).

These examples show that companies and employees, the people who pay for health care, are beginning to incorporate medical tourism into employee benefits. If these early programs are successful with providing comparable quality at sharply reduced costs, they will grow. Notably, insurance companies have a double incentive to experiment: they would like to save on costs themselves and they want to become better informed so they can offer new services to their clients (employers). Medical tourism can offer a “win-win” to employers and employees.

In another significant development in the globalization of health care, leading U.S. insurance companies and leading medical providers abroad have initiated pilots in which U.S. patients may select medical tourism for “in network” care (Deloitte). These pilots institutionalize medical tourism in California, Florida, South Carolina and Wisconsin. This development shows that medical tourism is not only practiced by individuals and providers, but also business and major insurance companies, which adds to the possibility that it will continue to grow. It adds to the trend of the globalization of health care. Other insurance companies offer medical tourism insurance to consumers (Insure.com).

Government is also attempting to introduce medical tourism, but conservative political groups have successfully thwarted several initiatives. West Virginia and Colorado introduced bills to offer employers in their states financial incentives if they offered medical tourism to employees, but neither bill passed (Insure.com).

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