Sending expatriate employees overseas is a massive undertaking for any company or organization, and this task usually falls to the global mobility or human resources manager. An expatriate assignment is an enormous investment, and the costs of a failed expat move can be quite significant. One of the most important considerations for HR managers is setting up an international benefit plan that will cover life, AD&D, disability, dental, evacuation and especially international health insurance. However, one of the most important questions to ask of any benefit plan is will it cover pre-existing medical conditions.
What is a Pre-existing Medical Condition?
A pre-existing medical condition relates to a medical condition that existed before an insurance company taking on the risk of an insured, sometimes known or even unknown to the employee. In our example, it would mean before being placed on the group benefit plan. An example would be someone who takes heart medication or saw a doctor in the past for a heart ailment and suffers a stroke or heart attack. The insurance company will then ask and check if that condition existed before insuring this person and if pre-existing conditions are not covered, the claim will be declined. In fact, pre-existing medical conditions are the number one way an insurer gets out of paying a claim.
How do Health Insurers Work with Pre-existing Medical Conditions
All individual expat health insurance plans will either exclude a previous medical condition, ask for an additional premium or decline the application. The same is true for life and disability plans. For a group plan, because the risk is spread among healthy and unhealthy people, they can often cover pre-existing medical conditions if the number of employees covered is large enough – usually 10 or 20 employees. However, we work with global medical insurance companies who can provide full coverage for pre-existing medical conditions on the medical coverage for both the employees and dependents if the employer has more than 25 or 30 global employees – including both expats and local nationals. These excellent insurance plans can even provide full coverage for an expat group of only two or three expat employees. This is a significant advantage for any expat employer as almost all employees or dependents, especially older ones, will have at least one medical condition.
An expat employer approached us with only six expat employees, one of which was not able to be covered because of an existing medical condition and he was declined coverage. The other employees were covered by the expat benefit plan, but if a claim occurred and the insurer found out that the large medical bill was caused by a pre-existing illness, that claim would probably be denied. Because the employer had over 30 global employees, we were able to secure a much better benefit plan for their expat employees that fully covered all six expats, including the employee with the illness. We also obtained Long Term Disability insurance, dental and evacuation coverage. Suffice to say, the employer was pleased and proceeded with the international group insurance policy.
The above case study illustrates the need for employers to obtain an expat benefit plan that can fully cover pre-existing medical conditions if possible. The advantages of such a program will not only save money and potential significant losses from a denied claim, but also allow the expatriate employer to both retain and attract employees and move them from one expat assignment to another under one cohesive global insurance program. For more information on how our firm can be of service and obtain quotes from the market, please contact us today. It always makes sense to work with an expat specialist firm.