Foreign Travel Risk

Overseas Employees at Risk

Undisciplined insurance purchasing practices leave dangerous gaps for expats.
By: | May 24, 2016 • 6 min read

A rogue wave pulled a vacationing military contractor walking on a foreign beach into the ocean. He hit his head on a rock and was paralyzed.

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Because his employer sent him on the trip for some R&R, the contractor’s Foreign Voluntary Workers’ Compensation insurance responded for his medical injuries even though he was vacationing instead of at a job site.

Luckily for the worker, his employer had the right coverage in place to forestall painful financial and health consequences.

But a substantial risk for employees and the companies they work for is that how and when coverage responds overseas often doesn’t track how coverage responds stateside, said Mary Quillen, manager, international workers’ compensation, AkesoCare.

Multinationals tend to carry many overlapping lines of insurance for their overseas business travelers, which is a help.

“You may have six or seven lines of insurance responding to a single claim,” said Logan Payne, assistant vice president, international practice, Lockton.

The primary policies are Foreign Voluntary Worker’s Compensation, Business Travelers Accident, and Kidnap, Ransom and Extortion, Payne said. Purchased effectively the coverages can be powerful. Purchased without the proper consideration, they may suffer from gaps as well as redundancies. Such gaps can cost employees dearly at a desperate time of their lives, Payne said.

To prevent that, he recommends centralizing insurance purchasing for expats instead of delegating it piecemeal to departments or regional offices. “Get all the insurance buyers in the same room to reach one comprehensive answer,” he said.

“Who does the traveler call if he loses his prescription drugs or needs medical evacuation? Who does he call if he hears gunshots outside his hotel?” — Chris Chao, senior vice president, Aon

International benefits from domestic health care insurance can range from nonexistent to “pretty good,” said Arno Chrispeels, owner, Health Insurance International. “A plan might cover emergency medical treatment but not evacuation or repatriation,” he said.

Since these are hefty expenses — $20,000 to $100,000 for a helicopter evacuation and $15,000 to $25,000 for repatriation — companies should review their domestic policies and fill in gaps by using international insurance for short- and long-term travelers.

Chris Chao, a senior vice president at Aon, said it is generally the travel assistance provider that keeps expats safe.

“Who does the traveler call if he loses his prescription drugs or needs medical evacuation? Who does he call if he hears gunshots outside his hotel?” Chao asked.

Duties of Care and Loyalty

When companies send workers out of the country, they have a “duty of care” to keep employees safe and healthy, while the expat workers have a “duty of loyalty” to follow their employers’ safety practices. Sometimes this requires workarounds and major effort. For example, said Denise Buckland, senior vice president, operations, International Medical Group, if a worker is diagnosed with an autoimmune disease, doctors will try staged medications.

Denise Buckland, senior vice president, operations, International Medical Group

Denise Buckland, senior vice president, operations, International Medical Group

“You try one, and if it doesn’t work, you try another,” she said. But the options can be very limited.

Let’s say a U.S. employee working in Thailand requires the injectable Humira to manage her condition, and no other drug gives her the relief she needs. Humira is illegal in Thailand, however. The carrier could contact the Thai and U.S. governments to help the employee get an importer’s license, but in the meantime, Buckland said, “the worker may get so sick that she has to go home.”

Especially in regions where the medical infrastructure is underdeveloped by Western standards, an acute but treatable event, such as a compound bone fracture, could quickly escalate into a life-threatening medical issue, said Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

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Duty of care is still an “unregulated philosophy,” said Hart Brown, senior vice president, practice leader, organizational resilience, HUB International. It depends on a number of interrelated steps, beginning with a vetted travel assistance provider and adequate insurance.

An employer “hasn’t met its duty of care” if its travel assistance provider does not have the right protocols or its expats don’t know the provider’s toll-free number, he said.

“Compliance is hard to enforce. You can’t sit on an adult to make him take his meds.” — Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

Coverage gaps and potential risks should be exposed in a thorough pre-trip screening, said Rob Howard, director of corporate sales, GeoBlue, a major provider of international insurance for expatriates.

When employees need medical help while on assignment, carriers will tap their provider networks to find care equivalent to what they would get at home, said Howard.

Pre-assignment evaluations should extend beyond known health issues, said Nick Dobelbower, vice president, global benefits practice, Lockton, to include language training if necessary, and alert the traveler to cultural differences and sensitivities.

Chris Chao, senior vice president, Aon

Chris Chao, senior vice president, Aon

The onus is on the employee to make a responsible decision whether to go on an overseas assignment. Sometimes, employees should decline assignments, Swanz said. A worker with asthma probably shouldn’t accept an offer in Beijing, where air pollution is a health hazard.

“An executive expat assignment is a huge investment for the company,” Howard said, and may include high compensation, language training, housing, security, a driver and private schools.

To recoup that investment, companies expect an executive assignment to last three to five years, but more than 50 percent end in failure after six to nine months. Among the top reasons for failure are the expat’s benefits package and health care, according to Cigna’s “2015 Global Mobility Survey.”

Duty of care and duty of loyalty should align during pre-trip planning, said Howard. He recommends a sit-down orientation with travelers as a group before they leave to review the size and scope of risks.

Other issues such as domestic employees can arise, Chrispeels said. “Employees may think they have international coverage for the entire household [such as nannies], but they don’t.”

The organization should also consider issues such as family mental health problems. A one-on-one meeting or a follow-up phone call may bring issues to light when travelers have medical issues they don’t want to share with a group.

One aspect of an employee’s duty of loyalty applies to medical compliance, especially to taking prescribed medications for common diseases such as heart conditions or asthma.

Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

Alison Swanz, senior consultant, Arthur J. Gallagher & Co.

“Compliance is hard to enforce. You can’t sit on an adult to make him take his meds,” Swanz said.

U.S. companies that send U.S. citizens overseas are subject to the Affordable Care Act, but the law is so complex — despite Congress’ attempt at guidance in the Expatriate Health Coverage Clarification Act of 2014 (EHCCA) — that “people get glassy-eyed looking at it,” said Mark Holloway, senior vice president, co-director, compliance services, Lockton.

Holloway recommends that companies write their expat coverage on U.S. paper as a practical way to satisfy the individual mandate — but to work with professionals who deal in expatriate insurance every day.

“Companies will want to work with a broker or counsel who plays in the sandbox because it’s such an arcane area of the law.”

Susannah Levine writes about health care, education and technology. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]