Survey finds employers expanding medical travel benefits
The shifting access to women’s reproductive health care in the US has spurred employers to consider adding or expanding travel and lodging benefits that help defray costs for plan members when they must travel to obtain medical services. In our recent 10-Minute Survey on 3 Big Issues for Health Programs, we looked at the prevalence of this type of benefit, what it covers, and the benefit design. Employers are increasingly looking at their benefit programs through the lens of diversity, equity and inclusion, and women’s unique health care needs are a core part of the conversation. The survey provides information that may be helpful in designing effective solutions that provide equal access to comprehensive coverage. The results below are based on responses from large employers (500 or more employees) unless otherwise specified.
Medical travel and lodging benefit
A medical travel (or travel and lodging) benefit refers to various vehicles for reimbursing employees for expenses they incurred to obtain medical care that is not locally available. Among all large employers responding to the survey, 44% currently offer a medical travel benefit, or plan to, in 2023, and another 10% are considering it. Respondents from very large organizations (those with 5,000 or more employees) are significantly more likely to offer a medical travel benefit – 56% offer it now or plan to in 2023.
How medical travel is covered. Most commonly, medical travel expenses are covered through the group health plan – 88% of respondents that offer coverage do so through their health plans. A handful of respondents provide financial assistance with these expenses through a health reimbursement arrangement integrated with the group health plan (4%), and some provide taxable reimbursement through a lifestyle savings account, or wellness travel account (3%), or through an employee assistance program (2%). Employers may pursue one of these alternative arrangements if their medical plan is unable or unwilling to administer a medical travel benefit. This may occur for fully insured plans or local / regional plans based in states that have legislated against access to specific medical services, such as abortion. Some employers pursue these alternative arrangements in order to reach a larger population of employees than just those enrolled in the medical plan.
Each option has compliance considerations to work through with counsel, including ERISA and tax code implications, mental health parity requirements for group health plans, and privacy protections.
Medical services covered. About half of employers that offer or plan to offer a medical travel benefit say that it may be used for all or most covered services that are not available in the member’s area or state (47%); another 39% say it may be used only for selected services. A smaller portion – 15% – only cover travel to a designated Center of Excellence (COE).
Minimum distance required. The minimum distance to the service provider required for travel benefit eligibility varies: 37% of respondents set a minimum of 100 miles, 6% set it at 75 miles, and 28% only require 50 miles. Some employers (18%) limit eligibility to employees who must travel out of state for services not available in their state of residence, and 10% only cover travel to a COE.
Maximum benefit. While most employers (82%) impose some type of benefit maximum, respondents were fairly evenly split among those limiting benefits per occurrence (25%, with a median amount of $5,000), per year (24%, with a median amount of $4,000) or per lifetime (18%, with a median amount of $10,000). Another 15% use some other type of maximum. The amount covered usually depends on what services are considered eligible. For example, in our experience, plans that only cover travel and lodging expenses for care received at a COE typically have a $10,000 lifetime limit, as it’s assumed that members utilizing this benefit will typically have one major surgery/procedure at the COE, but it will require a lengthier recovery and time away from home. Plans that cover all services typically have an annual or per-occurrence maximum since a member may need to utilize the benefit for different reasons at different times.
Abortion coverage and related benefits
Medical plan coverage. There is considerable variation in how abortion is covered in medical plans, and when asked to indicate the level of coverage in their plans, 23% of respondents weren’t sure. Nearly half (48%) say that their plans cover abortions without restrictions. About a fifth (22%) of respondents indicate that their medical plans restrict coverage to abortions that are medically necessary (when the mother’s life is at risk or in the case of rape or incest). An additional 7% will cover therapeutic abortions (in case of fetal abnormality or risk of physical harm to the mother if the pregnancy is carried to term) in addition to medically necessary abortions.
Very large employers responding to the survey are more likely to provide coverage for abortions without restrictions (59%). There is considerable regional variation as well. For example, large employers in Northeast are considerably more likely to cover abortions without restrictions (64%) than those in the South (38%).
Travel benefits. Over a third of large employers (36%) will assist employees with travel expenses incurred for abortion-related services. Most of these (27%) expanded an existing medical travel benefit (as described above) in response to the Dobbs vs. Jackson Women’s Health Organization decision, or plan to; just 9% already included travel reimbursement for abortion care prior to Dobbs. Among very large employers, 44% currently offer (or plan to offer) a travel benefit for abortion-related services.
The great majority of respondents that recently expanded a medical travel benefit say that one reason they did so was to maintain access to current covered benefits for all employees, regardless of location. Nearly half say it was to remain an employer of choice and for about a third, employee requests played a role in the decision.
Other types of support. Some employers are providing other types of assistance to women seeking abortion-related services. Telemedicine support – virtual consultations and prescribing and mailing abortion medications – is provided by 15% of respondents, and navigation assistance – logistical support finding a provider and understanding plan coverage – is provided by 12%.
Using a medical travel benefit to advance the goal of equal access to care
Since the Dobbs ruling this past June, a number of employers have chosen to offer some type of medical travel benefit in order to maintain or extend access to services covered under the health plan, including, but not limited to, abortion. Once Dobbs surfaced the issue of equal access to covered services, some employers have chosen to extend coverage for medical travel services to make it easier for all plan members to access needed care – for example, those living in rural areas with a scarcity of specialists – as well as for women to seek a full range of reproductive health care.
Mercer’s 10-Minute Survey on 3 Big Issues for Health Programs was in the field from September 21 through October 5, and 701 organizations participated. A report on the complete findings will be available in early November.