Using Your Health Savings Account to Pay for International Travel

Thousands of U.S. citizens are taking advantage of the low cost and high quality of foreign hospitals by traveling abroad for medical treatment. The savings are often 75 percent or more, and the entire cost of treatment may even be payable with tax-free money from a Health Savings Account.

Medical tourism first began to get popular in the 1990's, when people began traveling in large numbers to Brazil for cosmetic surgery. But as costs have continued to rise, thousands of Americans have been traveling overseas for real medical conditions, such as knee replacements, by-pass operations, heart valve replacements, and other serious issues. Many countries are seeing medical tourism as a good way to bring in foreign money.

In many cases the quality of medicine available overseas is equal to the top hospitals in the U.S. Patients are showing up at places like the Apollo Hospital in Hyderabad, India, part of a 36-hospital chain founded by a cardiologist from Massachusetts General. A heart valve replacement may cost $50,000 to $100,000 in the U.S., and only $12,000 in India, including travel costs.

Escorts Heart Institute and Research Center, in Delhi, India, is another popular medical tourist destination. It was founded by Dr. Naresh Trehan, an authority on robotic cardiac surgery formerly based at New York University.

Blue Cross Blue Shield has just announced that they will pay for treatment at Bumrungrad International Hospital, in Bangkok, Thailand for individuals from South Carolina. Over 80,000 Americans received treatment there last year. The hospital boasts that over 200 of its doctors are board-certified in the U.S, and will perform a knee replacement operation for 20 percent of what it would cost in the U.S.

Who Does This? Dodie Gilmore is a 60 year-old rodeo barrel-racing champ from Oklahoma. She runs a 180 acre ranch, but could no longer ride a horse because she needed a hip replacement. Her health insurance plan had an exclusion that wouldn't cover her operation, and she really didn't feel like paying the $35,000 it would cost her. Instead she and her partner flew to India where she had the surgery at the Max Institute of Orthopedics and Joint Replacement.

Her physician was Dr. S.K.S. Marya, who averages one American hip-replacement patient every week. Dodie's total coast, including travel, was only $11,000. She even managed to take in a tour of the Taj Mahal.

Forty to Sixty percent of those surveyed say they would consider surgery abroad if it could save them $5,000 or more. Going out of the U.S. (perhaps even just to Mexico), could be a worthwhile strategy if you have an exclusionary waiver on your policy, if you'll be having elective surgery not covered by your health insurance policy, or if you have a high deductible plan.

What is the Risk? According to the Institute of Medicine, over 100,000 accidental deaths occur in hospitals every year. And that's here in the U.S. Hospitals are a dangerous place to be, and you want to spend as little of your life in one as possible. So there are risks everywhere, and probably greater risks outside the U.S.

But the magic of the free-market does give you some protection. There is a lot of money flowing to countries and international hospitals that practice high-quality medicine. If a hospital does not provide quality service, you can bet its customers will go elsewhere, particularly if they are choosing among anywhere in the world.

The influx of foreign patients (and money) is enticing more western-trained doctors to return home, so the choices are actually increasing, and the quality and prices continue to improve. I believe that if you use care in choosing your provider and structuring your treatment, the risks are no greater than having surgery here in the U.S.

How to Research Your Options Keep in mind that most health insurance plans still will not cover for treatment outside the U.S., particularly if you are traveling specifically to receive medical care. So check with your insurer if the cost of the treatment is going to exceed your deductible.

The Joint Commission on Accreditation of Healthcare Organizations certifies hospitals here in the U.S. Their international division, Joint Commission International, certifies hospitals throughout the rest of the world. Make sure the facility that you are considering has been certified by them.

Then check out your doctor. Confirm that he or she is English speaking, and was trained in the U.S., U.K., Australia, or Germany.

Finally, consider hiring a consultant to help you choose the best hospital and surgeon for your needs. A good service will not only set up the treatment, but can also arrange all travel plans, meet you at the airport, and act as your liaison while you are being treated.

If you spend money from your Health Savings Account to pay for international medical care, the amount you withdraw is tax-free. Health Savings Account regulations also allow you to cover the cost of your travel if the reason you are traveling to get medical care is not "for purely personal reasons."

When choosing how to manage your health, you should carefully consider all your options. International travel is a great option for people with Health Savings Accounts.