Californian medical tourism agent Jim Arriola of Sekure Healthcare
explains the possible advantages of using cross-border healthcare for self-funding employers in Texas.
“Why would any employer choose to include medical providers from Mexico? The three major reasons are:
• Employers may have Latino workers who may prefer their healthcare from Mexican medical providers.
• Cost of care in Mexico is significantly less expensive than in the USA.
• In some rural US communities along the border, there is a long wait for access to some medical specialties.
The cost of healthcare is largely a function of the unit cost for hospital services, doctor services and medication. Since the unit cost of healthcare in Mexico is significantly less than in the USA, the cost of healthcare cover for similar benefit plans would also be significantly less.
Unlike California, where there are several cross border insurance plans, Texas law does not allow its insurance carriers to contract with Mexican providers. Several studies in the early 2000’s were conducted by the University of Texas to look into the merits of cross-border healthcare for Texas after California had allowed cross-border healthcare plans. The Texas medical community convinced Texas legislators in public hearings that patients could be seriously harmed if insurance carriers were allowed to contract with Mexican providers.
For those Texas employers who might be considering the merits of going self-insured, access to cross-border health care might be a positive tipping point factor. Under ERISA and federal law, a self-insured Texas employer is not prohibited from establishing benefit plan services that would allow participants to access healthcare services in Mexico. Such a plan could be developed to offer much more healthcare benefit bang for the employer’s allocation buck.
The Texas market has been largely void of any self-funded employer benefit programme with integrated cross-border healthcare benefit services. This is not entirely surprising given the Texas market and the relative complexity of an employer going self-insured versus the easier fully insured health plan model.
One pioneering effort is underway in Laredo, Texas with a large self-insured employer association. Our firm was contacted a year ago by a third party administrator working for an employer association offering self-insured health cover that had several employer members with a large Hispanic workforce along the Texas-Mexico border. The association had a number of employees who were already accessing care in Mexico, since some of them actually lived there and worked in the USA, while others were attracted by the much more affordable price tags for their care than those they could find locally in the USA. Everybody agreed that the standards of care that they found across the southern border were excellent, and that they could find high quality doctors and medical providers, if they knew where to look.
After many meetings with staff, actuaries, benefit consultants, steering committees, claims processing centers, medical directors, legal counsel, reinsurance carriers and countless other entities, the green light was finally given to proceed. It seems that cross-border health care is going to be a new win-win initiative that provides relevancy to the employer association in demonstrating innovations in the form of out of the box thinking to achieve healthcare cost savings to its employer members, while expanding consumer choice for employees.
Since self-funding has more moving parts than fully insured coverage, introducing cross-border healthcare benefits into the self-funding coverage offering increases the level of complexity. The biggest challenge by far is the lack of credible information and basic knowledge related to cross-border healthcare expenses, utilization frequencies, medical management processes, quality of care standards, provider networks credentialing and operations, the legal framework and the operating environment.
My company has been focusing on this kind of question for over six years. Cross border healthcare is an idea whose time has come, as the cost of care continues to increase in the USA For those who live close to the border with Mexico, it is no news that the price differential for the same procedures is very significant and continues to widen between the two countries.”