Spoiler alert: Today’s post contains no Spanish nor mention of tacos, but may appeal to readers considering a similar international trip or adventure.
Ok, Fine, I'll Answer It!
Each week someone inevitably emails me asking what I’m doing for health insurance. Okay, maybe not every week, and well, truth be told, only one person has asked about my health insurance situation. But here at blogging behemoth KeithArmington.com, one person is a non-immaterial percentage of my readership, so I thought I’d answer the question.
Medical Insurance vs. Travel Insurance
As soon as I began researching insurance options for my international trip, I learned of an important distinction between travel insurance and medical insurance. Travel insurance simply protects you against issues like lost bags, missed flights, and stolen goods. Sometimes the travel insurer throws in medical evacuation assistance as well, causing people (me) to assume the package contains “medical insurance.” It does not. This is what World Nomads, the most popular insurer in the digital nomad community, is notorious for doing, albeit possibly unintentionally. Medical evacuation usually covers the cheapest economy flight back to your home country, and that’s it. It doesn’t actually cover medical treatment.
Travel Insurance Isn't Worth It
Considering travel insurance for what it is, and more importantly what it’s not, I decided I didn’t need or want it. The most valuable aspect of it, for me, was the “personal belonging reimbursement” for lost or stolen items. Upon reading the fine print, however, I found I wouldn’t actually receive reimbursement until I officially reported my item lost (i.e., filed a police report) and proved I made a “reasonable effort” to retrieve it. In a country like Mexico, where I currently reside, no authority figure would care if someone stole my laptop – they’d know there’d be no way to get it back, and no point in trying, so for me, travel insurance wasn’t worth it. Plus, other travel insurance benefits like missed flight and lost baggage reimbursement are usually covered by airlines anyway; when you buy a plane ticket, you’re essentially buying a little bit of travel insurance from the airline, who will usually make you whole if you miss a flight or lose a bag.
Medical Insurance Is Definitely Worth It
So, after crossing travel insurance off my list of things to buy, I came to medical insurance, something I definitely needed. Hospital expenses, surgeries, prosthetic limbs (noted explicitly in my current policy . . . I didn’t quite know how to feel when I read that), doctor’s visits, and the like can get massively expensive. But wait! In the course of my research, I discovered that healthcare outside of the U.S. usually is just as good, if not better (just ask Philadelphia Sixers center Joel Embiid, who traveled to Qatar for foot treatment) and much cheaper! Many countries believe that everyone deserves affordable (even free) healthcare, regardless of ability to pay, whether they have insurance, or where they were born. Preposterous, I know.*
*This is sarcasm.
Southeast Asia and Mexico are known for making quality and affordable health care available to all. “Medical tourism” occurs in both regions, with everyday people like you and me (mostly Americans, since our healthcare costs are by far the most expensive) traveling across the world to obtain reasonably priced healthcare. After reading all this, I knew if I got injured somewhere outside of the US, I’d most likely be okay, even without insurance. The only problem would arise from an improbable life-threatening situation like a heart attack, extended hospital stay, or amputation. That’s when the overseas medical bill could get expensive by anyone’s standards, and that’s why, unlike travel insurance, I didn’t cross medical insurance off the list. Now it was time to decide which policy, and being an American looking for health insurance in 2016, the first question was, “Should I get Obamacare?”
Tinkering around on Healthcare.gov (it’s actually a decent website now), I realized Obamacare didn’t make sense for me, at least not this year. The monthly premiums would have been $180 for the most basic plan with a sky-high deductible, and I didn’t qualify for any discount due to my three months of income this year and current assets. (In 2017, when I’ll likely be without a corporate job and salary for the whole year, I may return to Heathcare.gov to check my new premium cost and opt for it if the price is right.) COBRA – a short-term quasi-continuation of one’s previous employee healthcare – was even more expensive, so that was out, too. Additionally, since Obamacare and COBRA only cover treatment within the U.S., I’d have to pair them with some form of medical evacuation coverage (to get me back to the States should I get injured), pushing the total monthly cost over $200. So, I'll just avoid US healthcare, I thought. Simple as that. But wait! It turns out the U.S. government now fines individuals who don't buy health insurance! That's right, if you're an American citizen, and choose not to buy the expensive American-healthcare, you get fined like a common criminal! In 2016, the fine is 2.5% of your income or $695, whichever is higher. It's ludicrous! [End of rant.]
There’s good news, though: the fine for not having health insurance, while frustrating in principle, isn't all that bad. First, you get a two month grace period between coverage periods, delaying the fine so you have time to shop for and purchase healthcare. So for 2016, I’d only have to pay roughly half the annual fine (i.e., no healthcare starting May, so fine starts in July). Second, if I stay abroad for 330 days in a 365-day period, I qualify as a true expat and am exempt from the fine. In all likelihood, I’ll meet this requirement; if I don’t, the cost of the fine plus the cost of my non-US health insurance will still be significantly less than Obamacare or COBRA coverage.
The Holy Grail: International Health Insurance
Okay, to summarize so far, no travel insurance (unnecessary, ineffective) and no Obamacare or COBRA (expensive, no coverage outside US). What’s left to satisfy my medical insurance need? International medical insurance! It’s awesome, and covers you everywhere in the world. Since every other country outside of the United States offers very cheap healthcare, companies (even American ones) charge extremely low premiums for health insurance if you opt for “non-U.S.” It’s pretty crazy – when you go on websites for international medical insurance companies like Cigna and IMG, the rates for identical plans double if you select the “I want coverage in the U.S., too” option.
I ended up going with IMG Patriot Medical Insurance for which I pay $30 per month in a “pay-as-you-go” plan. I get medical insurance coverage up to $1 million US with a $1,000 US deductible. The plan includes 14 days of coverage in the US should I decide to return to visit my family or whatever. They have an 800 telephone number in every imaginable language available 24/7/365, and although it doesn’t include medical evacuation to your home country, it’s a blessing in disguise. If I was in fact evacuated back to the US, I would have to pay an “arm and a leg” for treatment that would have cost a fraction of that had I stayed in the country where I got injured. Cigna offers an extremely similar plan, but I ultimately went with IMG based on price, quality, and the fact that their main call center is in Indianapolis (where my sister now lives) and the sales rep I talked to there was a sweet and trustworthy Midwestern girl.
Three months into my trip and so far I have not needed any medical care. My fingers remain crossed, but I know that should an emergency arise, I’ll be in good hands. And any artificial limbs I may need will be paid for.
PS: To anyone thinking about taking a similar trip, feel free to email me with follow-up questions or about other logistical / practical items! I spent more than a month researching things like insurance, what all to buy, where to go, what credit cards to get, etc., and while I'll be posting most of my findings eventually, I can't say when exactly that will be.