Know What Your Travel Insurance Covers. Take Nothing for Granted.

Most travel insurance plans provide limited coverage for pre-existing conditions.  That’s the good news.  The bad news is that unless you know what those limitations are, even a one or two-day stint in a U.S. hospital can ruin you financially. When you apply for coverage: know the rules.

I recently heard of a Canadian man who was admitted to a U.S. hospital with serious symptoms of a blood borne infection that required immediate treatment with antibiotics and a lot of investigative technology to determine the cause of his unusual symptoms. Fortunately, the antibiotics worked and within four days he was stabilized and able to return to his vacation home in the sunbelt. Good news.

The problem is that when the hospital submitted his claim for over $80,000 to his insurer, the assessors realized that the man was not eligible for the plan he purchased and his claim was denied.  It appears that when applying for insurance, he opted for the cheapest coverage level, one that is usually designed for the healthiest applicants, those with no pre-existing conditions and little need for medications. In short, he didn’t read the eligibility standards because he considered them part of the “fine print”—just a formality.

The standards, however, stated that if in the past three years he had ever had symptoms, been treated for, or required more than two medications for blood pressure (which was one of a list of conditions he was asked about), he was ineligible for coverage for the particular option level, and he should apply for a less restrictive, albeit more expensive, premium level. he didn’tHHe didn’t.

He argued that the blood pressure for which he was being treated had nothing to do with his hospitalization for blood infection.  And though that was true, the insurer contended that had it known about his blood pressure medications, and the true state of his health, it could have offered him a different plan, one that was designed to cover higher health risk, but it was precluded from doing that when he signed on to a plan for which he was not eligible. Consequently, it voided his policy—all perfectly legal.

That’s like insuring your home for fire protection and neglecting to tell your insurer that your basement is full of dynamite.

Sad, but this happens a lot. In some cases applicants look only at the price of a plan and don’t bother to see what it covers.  They think all plans are the same. Others may be aware of different coverage (and risk) levels but aren’t familiar enough with their own medical records to know if they have any of the conditions listed on the non-eligibility list.  Yet others are not told by their own doctors what conditions they have, or whether or not those conditions are stable according to the way the policy describes stable.  And when it comes to defining stability, or what a pre-existing condition is, or any other such terminology, the policy rules.

Plans that require medical applications and eligibility standards require accurate information from the applicant.  That’s all the insurer’s medical underwriters have to go by in determining whether to cover you and under what conditions. If you’re applying for a medically underwritten plan or one that requires you to meet certain eligibility standards, you need to read those terms, apply them to yourself and answer questions put you honestly and accurately. More and more, I recommend that if you have any conditions under continuing treatment or surveillance, you take the time and have your doctor go over your application with you.

If not, ask yourself what you would do it on your return from your winter vacation you were presented with a $20,000 or, $60,000, or $120,000 hospital bill? It’s not an unusual occurrence.

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