Benefits Implementation

Tax Implications of Medical Expenses and Cash Incentives

Specific medical expenses can be paid for or reimbursed by a group health plan tax-free, even if care is provided overseas. For example, inpatient hospital care, lodging, and meals for the patient while in the hospital are covered by the plan without the worry of taxes.

Protected Groups

Employers need to be careful that their Global Health Care option does not target employees based on protected group characteristics such as age, sex, race, or ethnicity. HIPAA prohibits plans from discriminating based on health status.

Travel-Related Exposures

Plan sponsors and employers should explore the legal remedies available to participants who get hurt while traveling for medical. Plan sponsors might arrange for additional travel insurance to address this exposure.

HIPAA Privacy Issues

HIPAA privacy rules are strict and health plans and providers in the U.S. are required to follow these rules for services that they may provide internationally. However, outside of the U.S., HIPAA does not apply to foreign hospitals and doctors.

Written Provisions and Plan limitations

A Global Health Care Plan needs to be clearly communicated so participants are aware of what is available to them and what is not. If the plan sponsor is offering a significant financial incentive for employees to choose the Global Health Care option, then liability risks may increase.

Global Health Care Plan – Content and Creation

A number of employers now provide an option for overseas treatment as a part of their standard health benefit plan. Healthcare cost savings for both the plan sponsor and the employee is their main objective for Global Health Care.

ERISA Fiduciary Obligations

Plan sponsors need to meet ERISA fiduciary requirements when managing their group health plan. They have a wide latitude in designing plans to best meet the needs of both parties: the plan sponsor and plan participants.

Implementation of a Consumer Directed Global Health Care Plan

Before promoting Global Health Care as a treatment option, plan sponsors need to consider the following issues:

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