Travel Medical Insurance (Benefit Tips ® - © 2014)

Be cautious when discussing travel insurance coverage with your staff. You’re not an insurance expert and don’t know the medical history of your employees or their families well enough to advise or assure them. It’s safe to say that we shouldn’t travel without having sufficient travel medical insurance that we understand.

Emergency travel medical insurance is kept affordable by covering only unforeseen medical incidents. Some policies also exclude large scale events such as terrorism war, and the like. The coverage and limitations of travel insurance policies vary widely but here are the most common exclusions:

• Conditions for which during the 90 days prior to departure:
• new symptoms developed,
• symptoms worsened or increased in frequency,
• new treatment was recommended or begun,
• medication changed,
• tests or surgery were performed, ordered or recommended,
• hospitalization occurred.
• Pregnancy beyond 7 months of gestation.
• Excessive use of medication, alcohol, drugs or toxic substance.
• Hazardous activates such as rock climbing or mountain climbing.
• Commission of a criminal offence.
• Intentional self-inflicted injury, suicide or attempted suicide.
• Terrorism, war, insurrection, riot.
• Radiation or radioactive contamination.

Travelling for relationship, relaxation and adventure should be enjoyable. Here’s a common sense approach to manage your risk:

• Buy good quality cancellation insurance when you book your trip.
• Don’t travel unless your health is stable.
• Don’t travel to risky parts of the world.
• Don’t take unnecessary risks.
• Read your travel medical insurance policy and know the limits of your coverage.

If you don’t provide travel medical insurance a part of your health insurance benefit then it’s important to have a method of covering those employees who travel outside the province for your business.

Can benefits be reduced for employees with coverage through their spouse?

Employers often ask if they can give more coverage to employees who don’t have coverage through their spouse. They don’t want to waste benefits on employees who don’t need them. The challenge with this thinking is that any benefit plan fully satisfies our needs. A simple example is orthodontics; an employee who has a child that needs braces for their teeth needs benefits from having coverage under two plans since most good plan would only cover half the cost.

Built in Cost Savings:

With both a defined health benefit plan (health insurance) and defined contribution health benefit plan (health spending account), the employer’s costs are reduced when employees have coverage through their spouse’s insurance plan. If you use health spending accounts, then all claims are first paid by the spouses’ plans and your plan only the unpaid portion. If you use insurance, then the spouses’ plans pay the spouse’s claims as well as the children’s claims when the spouse’s birthday is earlier in the calendar year than the employee’s birthday.

Further Reducing Health Costs by Reducing Coverage:

Occasionally, employers will gain additional cost savings by excluding people from their health insurance benefit plan:

• Exclude coverage for spouses who work 30 or more hours per week (they should be covered by their employer) – this is difficult to monitor and adds financial pressure if the spouse does not have benefits.
• Require employees to contribute (i.e. 25%) toward the cost of health premiums (encourages those with spouses to waive coverage) – this is not tax-effective in that employees are contributing to non-taxable benefits with after-tax dollars.

Occasionally, employers will gain additional cost savings by reducing the health spending account contribution for those with spousal coverage:

• Reduce contribution (i.e. by 50% ) for employees that are covered by a spouse’s health insurance plan – this is difficult to monitor and limits the ability to cover items not covered by insurance.

Best Practices:

Assess every aspect of your benefit plan design to your benefit goals to ensure that it delivers appropriate incentive to the types of employees that you are trying to attract, motivate and retain. The plan should be valuable to employees regardless of their level of need or coverage elsewhere.