Paying Workers to Go Abroad for Health Care

by M.P. MCQUEEN ,  The Wall Street Journal | 2008-09-30

Insured Americans are starting to see some unusual options in their health-provider networks: doctors and hospitals in Singapore, Costa Rica and other foreign destinations.

In an effort to control rising costs, a small but growing number of insurers and employers are giving people the choice to seek treatment in other countries, a practice known as medical tourism. Until recently, most Americans who traveled abroad for medical care were uninsured, or were seeking procedures not covered by insurance, such as cosmetic dentistry or aesthetic surgery. Now, a handful of plans are beginning to cover treatment overseas for heart surgery, hip and knee replacements and other major surgical procedures.

While medical tourism isn't expected to be a solution to the country's soaring health-care costs, the practice is intended to produce savings for insurers, employers and workers. Open-heart surgery, which can cost roughly $100,000 in the U.S., can be done at an internationally accredited hospital in India for just $8,500, for instance. Proponents note that many international hospitals are staffed with American and European-trained physicians. Many facilities also are accredited by an affiliate of the Joint Commission, a nonprofit group that is the main accrediting body for U.S. hospitals.

Whatever the qualifications of doctors and hospitals abroad, some U.S. health practitioners remain concerned about such issues as the safety of blood supplies for transfusions and tissue for bone grafts. Long-distance travel also poses special risks to patients, including blood clots from airplane flights and lack of legal recourse for negligence and malpractice, critics say. And follow-up care can be difficult to find once a patient returns home; many U.S. physicians and dentists are reluctant to treat such patients for fear of being exposed to malpractice lawsuits because of possible poor treatment abroad.

To be sure, most traditional employer health plans offer little incentive for workers to endure long flights overseas for treatment: The plans usually cover 100% of the cost of medical treatment once workers reach an out-of-pocket limit for co-insurance and co-payments.

So to make travel abroad more attractive, plans that offer medical-tourism programs often throw in a bonus for employees if they agree to undergo elective surgeries abroad, or they offer to split the cost savings between the employer and worker. Travel and accommodation costs also are sometimes reimbursed.

Maine-based supermarket chain Hannaford Bros. Co. this year began allowing its 18,000 insured workers and dependents to travel to an internationally accredited hospital in Singapore for surgical hip and knee replacements. The company's self-funded plan, which is administered by Aetna Inc., waives out-of-pocket expenses, which can save patients up to $3,000, and reimburses all travel costs.

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