Canadians love to travel. But, travel insurance issues abound as new insurance provisions or clarifications of existing adjudication practices, are forcing plan sponsors to revisit their communication to plan members.
Starting off with the first payer; (the Provincial Medical Plan) in this case, the Ontario Ministry of Health and Long-Term Care, visitors to that website are forced to ‘acknowledge’ the Ministry’s recommendation to “obtain private travel insurance before leaving Canada” and to also acknowledge that elective services will not be reimbursed without prior approval. This acknowledgement clearly puts the onus for ‘adequate coverage’ on the traveller. Unfortunately, travellers (many of them covered by employer sponsored group benefit plans) often mistakenly presume this liability is held ‘entirely‘ by the Insurer of these same plans. Peeling back the onion, one quickly realizes, that this is not always the case.
What members do not realize is that in the face of rising healthcare costs and an ageing Boomer workforce, with the financial means to travel, Insurers have increasingly bolstered their contractual provisions to ‘manage’ the number and absolute claim dollars that hit their books. Out of Country travel claims in the vast majority of cases are ‘fully insured’ from the first dollar of claim, which means that this risk falls squarely on the Insurer. Not surprisingly, Insurers have a vested interest in managing these claims to limit their exposure.
Plan members who travel; particularly those with co-morbidity’s or who are older and thus find themselves using various maintenance medications are particularly at risk. Maintenance medications, if taken appropriately, normally will manage multiple health conditions quite well. But, changes in drugs or dosing as a result of a reaction to certain drugs, drug absorption rates etc., will often necessitate a change in medications or the need for additional testing etc. These changes can lead to other health ailments or in severe cases to hospitalization as result of these pre-existing medical conditions.
Insurers in many cases have introduced stability clauses to define acceptable travel practices for those with pre-existing medical conditions. These stability provisions usually suggest that within a pre-defined period, before departure (commonly 3 months), that an insured person;
- must not have received medical care, been under evaluation for a new symptom or condition uncovered in a medical exam
- experienced worsening symptoms or frequency of symptoms
- been prescribed medication or changes in medications (some wording suggest that a ‘reduction’ in medication dosage could be deemed a contravention of the stability provision)
- has not received care or been treated at a hospital for a medical condition
- and has not been advised to undergo future tests or non-routine appointments, investigations or surgery for a diagnosed or undiagnosed condition.
The fact that some Insurers have included wording that includes “undiagnosed” conditions, suggests that travellers have to exercise ‘reasonable prudent person guidelines’ in assessing their suitability for travel. Clearly, if their is any doubt as to whether one should be travelling, that member should check with their Insurer, PRIOR to arranging any travel.
Some insurers like Manulife, (December 2012) and Empire Life (June 2014) have implemented global contract amendments to include ‘Stability Provisions’ and mandates requiring plan members to contact the Insurer’s travel assistance call centres within a certain time frame (i.e. 48 hours) of an emergency event, to better facilitate claims management and ultimately air evacuation. Other Insurers seem somewhat more passive, in that they have provisions related to stability clauses, but have not re-written contracts or communicated these changes specifically and separately to plan sponsors (i.e. RBC and others). Some Providers (including Encon; a Third Party Aggregator) have similar clauses in their contracts but at least have specific published Out of Country and Travel brochures that advise their insured members of these provisions. Manulife, it should be noted, also advises of its provisions in a marketing piece to clients.
The fact that Providers have Stability Clauses, could be argued is a good thing, as they have attempted to shed light on a very subjective and ambiguous provision of many employer sponsored plans. It might be argued that Insurers who do not openly publicize these provisions or claims practices are creating a bigger issue for plan sponsors than not having such clauses in their contracts. For example, both Great West and Sun Life report not having specific ‘stability clauses’ in their contracts. In the case of Great West Life, they indicate that ‘pre-existing conditions may apply, depending on the status of a condition’. That sounds like a stability provision and even if it is not, should a member who was diagnosed with a heart condition a month before travelling and who was put on blood thinners, but who had no other symptoms in the weeks leading to their travel, should they feel confident that Great West Life would pay in the event of a cardiac event. Great West Life should not be signalled out in isolation as Sun Life has similar wording in that they indicate, “we do not cover expenses when there is a strong possibility at the time the traveller leaves the country, that they would need treatment”. Should a Sun Life plan member feel particularly secure with their decision to leave the country based on that statement?
Tightening restrictions on travel have not just been limited to pre-existing medical conditions, but also to travelling beyond the 32nd week of pregnancy. In the case of a woman who is at higher than average risk of complications or early delivery, vigilance is also required to avoid a costly outcome. The recent tribulations of a Saskatchewan couple who had a ‘Million’ dollar baby, by virtue of the crippling medical bills they incurred when Jennifer Huculak’s water broke while on vacation in Hawaii in the 6th month of pregnancy, serve to highlight the importance of understanding these travel restrictions in benefit policies. Privacy concerns have limited the revelation of the full details in that particular case but Blue Cross likely should not have received as much public scorn as they did, because Insurers have an obligation to enforce the provisions in their contracts. The speculation is that a bladder infection may have triggered a case for a pre-existing exclusion claim by the Insurer, but this has not been confirmed. The story serves as as a vivid reminder that potentially catastrophic financial consequnces await those who fail to understand the coverage restrictions in any insurance contract; including that of travel insurance.
Plan sponsors would be strongly advised to obtain the stability provisions (if present) from their booklet or Insurer and to send this provision to all their members, along with a strong suggestion that the member contact the Insurer directly if there is any doubts as to the member or their dependent’s suitability for travel outside Canada. Obtaining clearance from a doctor is a start, but in many contracts is not good enough. This of course is preferable to not having any backup at all. Safe travels.
For over 20 years, Chris Pryce of Human Capital Benefits has been advising employers on all aspects of managing employee benefits programs and related products. If you have any questions, you can contact Chris at 416.924.8280 or by email at email@example.com