Expatraite Health Insurance Concerns

We have used this post to outline the most common problems with expatriate health insurance including both expatriate group health insurance and expatriate individual insurance. This is from the perspective of a U.S. benefit or risk manager.

First and most importantly, is the expatriate health insurance scheme offered by an insurance company that is admitted in the home office State of the employer. This means the expat insurance will be HIPAA compliant, and be in lock step with ERISA etc and other U.S. Federal and State laws regarding international insurance. This is critical if the expatriate population is composed of U.S. citizens vs. TCNs.

If the expatriate group is mostly TCNs, they will not need HIPAA compliant expatriate benefits of course, but the U.S. citizens in the group will. Two plans may be necessary

Although this is going away with most carriers, medical underwriting can be a problem for group sizes under 10, and more commonly today, under 5 expats. This means that the entire group of expatriates could be denied insurance if there is just one individual expatriate, or a dependent that has a serious health condition.

Finally, pre-existing condition limitations are a problem with some expatriate health insurance programs. Make sure you understand if the plan covers all pre-existing conditions on day 1, or there is a very restrictive clause, like a 5 year pre-ex lookback!

Expatriate Insurance and HIPAA

If an expatriate searches the web, there may be hundreds of different providers for individual international medical insurance and small group expatriate health insurance programs. Buyer beware, many of these plans are not considered HIPAA plans and are not HIPAA compliant.

What exactly does this mean? It means that employees and individual expatriates working abroad as international assignees that are under a foreign international health insurance scheme like BUPA international for example, may have a problem when returning to the U.S. if the program was not HIPAA compliant.

If an expatriate developed a pre-existing condition during the expatriate assignment, they may find they have no coverage when they return to the U.S. because health insurers can impose pre-existing condition limitations on those attempting to enroll in U.S. plans coming from plans that are not HIPAA compliant. Foreign plans and offshore insurance plans are not HIPAA plans.

Employers using non-HIPAA plans to cover U.S. expatriates are taking a big risk. Employees that return to the U.S. and are shocked to learn they cannot find healthcare that will cover the pre-existing condition will file a lawsuit against the employer.