Starting this year, many Americans who receive health insurance from their employers will enjoy health-related travel cost coverage for the first time. This benefit will especially help those with rare and chronic diseases who often have to travel out of their home counties to access specialists. All employers should follow this travel coverage trend, not only because it helps their most vulnerable employees but also because it can help improve their bottom lines.
The catalyst for this new coverage benefit is the Supreme Court’s decision last year to strike down Roe v. Wade and relegate abortion law to state governments. In the aftermath of this ruling, some states, such as Texas, Tennessee, and Missouri, have implemented new abortion restrictions.
A recent survey by WTW estimates the number of companies that offer abortion travel benefits will increase by approximately 50% in 2023, growing from about one-third of businesses nationwide to around half. Even more companies are considering boosting these benefits in future plan years. Yet these travel benefits aren’t limited to abortions. The survey finds that nearly 90% of employers align their abortion travel benefits with those related to employees’ broader healthcare needs.
This development is a rare piece of good healthcare news for patients who now face one less financial barrier to care. While many individuals can receive all the care they need in their hometowns, patients with rare and chronic diseases often must travel long distances to get treatment from specialty clinics, frequently referred to as centers of excellence. Given the severity and complexity of many rare conditions, telehealth usually isn’t an option.
Consider the story of Becky, a Washington, DC-area mother of two sons who have a rare genetic disorder that restricts their movement. After much searching, Becky found a pediatric neurologist who could treat her sons’ condition and was covered by her health plan. Unfortunately, this doctor was based at Boston Children’s Hospital, several hundred miles away.
Hotels in Boston aren’t cheap, and it cost Becky well over $1,000 to make the trip each time. For families with disabled children, such expenses can be insurmountable. According to an Urban Institute study, nearly one-third of families with disabled children face extreme financial difficulties. Becky’s family was forced to cut back on other essentials in their budget to help pay for these trips.
These travel-related expenses amount to rounding errors for a company health plan, but they can do significant damage to patients’ pocketbooks. Families with employer-sponsored health coverage already directly pay $6,100 in annual average healthcare premiums as well as several thousand-dollar deductibles, co-insurance, and co-pays. The least employers can do is take health-related travel costs off the table.
Covering travel expenses is not an act of altruism for employers. It’s in their financial interest to have their workforce access the specialized care they need to feel better rather than consigning them to an inadequate care treadmill at the local hospital. In today’s ongoing war for talented employees, robust health coverage can also help businesses attract the best workers.
Given the massive price variances in the American healthcare system, employers may also find it’s cheaper to send their employees out of state for high-value care even after accounting for the travel costs. For instance, the Surgery Center of Oklahoma has made headlines for offering procedures at far lower rates than big local hospitals. When travel costs are covered, employers suddenly have a significantly expanded market to identify better-value alternatives that can save money for the company’s health plan.
Travel coverage is the right move for employees and employers. Watch for even more companies to offer it in future years as the success becomes evident, opening up promising specialty care options for even more patients in all corners of the country.