Retirees love to travel.  For many of us, retirement affords the time and opportunity to finally visit all those places we’ve dreamed of seeing.  We can finally reward ourselves by traveling to foreign lands after leaving busy work lives behind.  Yet, whether on vacation or at home, accidents happen; sudden illnesses crop up.  That truth raises an important question.  Do we have health insurance to cover an emergency or sudden illness when we travel outside the United States?

As a General Rule, Medicare Does Not Cover When You Travel Abroad.

Original Medicare

Many of us have Original Medicare.  We choose providers who accept Medicare, and Medicare processes the claims and makes authorized payments.  A lot of us with Original Medicare have also purchased Medicare Supplement policies to pick up the difference between what the government pays and the remaining cost. 

Medicare recipients who have Original Medicare, Part A and B, are covered when traveling anywhere within the Unites States, including the District of Columbia and U.S. territories: Puerto Rico, Guam, American Samoa, the Virgin Islands, and the Northern Mariana Islands. However, if you travel to Europe, Latin America, Canada or any other location outside the U.S., traditional Medicare will not cover you.  That said, there are four exceptions to this basic rule.

1. If you live in the U.S., experience a medical emergency, and the nearest hospital is in a foreign country, Medicare will cover that emergency care.
2. You are traveling between Alaska and the lower 48 states, and you are taking a direct route through Canada, without unnecessary delay.  If a medical emergency occurs as you are traversing Canada, and the closest hospital to treat the emergency is in Canada, Medicare will pay for treatment.
3. Medicare will also cover particular health care services you get in a foreign hospital, even if it is not emergent, when you live in the U.S., but the hospital closest to your home is in a foreign county.
4. Medicare provides coverage if you are on a cruise ship, the ship is either in a U.S. port or within 6 hours of arrival or departure from a U.S. port.  The physician who treats you must be authorized to provide medical care aboard a cruise ship.

If you fall into one of these four exceptions where Medicare offers coverage, be aware that the usual claims process will not work.  The burden is on you, rather than the provider, to submit the claim to Medicare.

Medicare Advantage Plans

Medicare Advantage plans are different than Original Medicare. Private companies offer the plans.  Medicare pays the company a set monthly figure to cover your Medicare expenses. Coverage when you are traveling outside the U.S. depends on the plan. The law requires Advantage plans to cover the same limited travel situations as Original Medicare.  Some Advantage plans may offer additional coverage for traveling abroad. You will need to read the Plan Document containing all the details on specific coverages to determine its policy on foreign travel. 

Many Advantage plans are HMOs.  These plans have a closed network of providers. You are assigned a primary care provider who is responsible for making any referrals to specialists you need. Normally, there is limited or no coverage if you see a provider outside of the network.  PPOs or Preferred Provider Organizations offer a larger network of providers.  Normally, you do not need a primary care doctor’s permission to see a specialist.  You pay less if you see a network provider; more if you go outside the network.

Private Fee for Service Plans are yet another type of Advantage plan.  They are less commonly seen than HMO’s and PPO’s.  You may see any provider who is willing to accept the Plan’s terms and fees.  The last type of Advantage Plan is the Special Needs Plan.  Special Needs Plans are limited to people with specific illnesses or disabilities.  With Advantage plans, there is normally a system of co-pays for doctor visits.

Medicare Supplements or Medi-Gap Policies

Medi-Gap policies may offer emergency coverage for travel outside the U.S.  Medi-Gap plans C, D, F, G, M, and N must provide some level of emergency foreign travel coverage.  These policies must pay 80% of the billed charges for certain medically necessary emergency care outside the U.S.  To be covered, the emergency must occur within the first 60 days of travel.  There is a lifetime cap of $50,000 on this emergency coverage and a $250 deductible.

Retirees Who Move to a Foreign Country

Some folks retire to a foreign country. They may pick a place like Italy or France to spend their golden years because the romance and history of these countries captured their imagination, or they want to return to their European roots.  Others pick places like Mexico or Costa Rica where the cost of living is considerably less than in the U.S.  The foreign country does not matter.  Medicare will not cover retirees who live abroad. 

Expatriates must find other options for medical coverage.  Some countries have national medical plans and allow foreign residents to buy into those plans.  Other expats purchase private insurance.  If you live abroad and need private insurance, it is important to tailor your coverage to meet your needs.  If you are living in a place with poor health care, it is vital to have “evacuation” coverage that will fly you to a quality hospital.  If you live in a country with decent health care but high costs for doctor visits, you need a plan that covers outpatient visits to physicians.  You may also need a plan that covers preexisting conditions.

If you move back to the U.S. after living in a foreign country, your Part A Medicare coverage will automatically resume.  Part A is the Medicare coverage for hospitalizations, skilled nursing care, hospice, and some home health care.  There are no premiums for Part A.  Part B Medicare covers outpatient services.  Medicare charges a monthly premium for Part B.  When you return to live in the U.S., you will have to pay an “enrollment penalty” to reinstate your Part B Medicare.  In addition, Part B premiums increase 10% for every year you are unenrolled.  That can result in a hefty monthly premium for your reinstated Part B coverage.  Many expats find it worthwhile to continue paying the Part B premiums while they live abroad.  That way they can resume their coverage on returning to the U.S. with no penalty or premium increase.

Another caveat on the Part B issue.  If you turn 65 while you are living abroad and later return to the U.S., there will be no penalty and no premium increase so long as you enroll in Part B within 3 months of returning and establishing residency in the U.S.

Conclusion

If you are traveling to a foreign country, be prepared for any medical expenses you may encounter.  If you have concerns, purchase travel coverage.  If you are moving to another country, plan ahead to cover your health care needs.  You will not have Medicare to fall back on.     

Resources

https://www.ehealthmedicare.com/faq/will-medicare-cover-travel-another-state-country/

https://www.medicare.gov/publication-ordering/11037

https://www.medicare.gov/health-drug-plans/health-plans/your-health-plan-options