Healthcare costs in the US are the highest in the world, making visitor health insurance more important than many realize while they or their relatives are visiting in the USA. To make smart decisions, consider your choices first; by knowing what you can’t do and how not to purchase visitor health insurance, you can learn what you can do to protect yourself and your loved ones from the impractical ideas described below.
Why do I have to buy visitor health insurance for my visiting parents? Why can't I just add my parents as my dependents in my group health insurance through my employer?
In the United States, at least for the insurance purposes, your dependents are your legally wedded spouse and your minor children under the age of 18 (up to 26 years if they are attending school). Your parents are not considered your dependents. Therefore, you can't enroll them in your group health insurance through your employer.
No matter how dependent your parents are on you, financially, emotionally, or in any other way, they cannot be considered your dependents in the USA.
Why do I have to buy visitor health insurance for my visiting parents? Why can't I just buy domestic health insurance from well-known companies like Aetna, Cigna, United Healthcare, or Blue Cross Blue Shield?
You mentioned domestic health insurance companies; the companies that provide domestic health insurance only provide the insurance to United States citizens, permanent residents, and legal temporary workers. Even though the exact criteria varies from state to state and company to company, these companies require a Social Security Number (SSN) or Individual Tax Identification Number (ITIN), and proof that the person has been continuously staying in the U.S. for the past 6 months, 1 year, 2 years, or longer.
There is no domestic health insurance company that offers insurance to tourists in the United States. That is exactly why you have to purchase visitor health insurance.
You may ask, “But why don't they offer visitors health insurance?”
This answer is more complicated, but we will try to simplify it as much as possible.
Domestic health insurance companies are required to provide certain minimum benefits to US residents, like pre-existing condition coverage, unlimited lifetime benefits, and so on; if they provide insurance to visitors, they will have to follow all the same federal and state mandated rules required for US residents. However, because domestic insurance companies don't know the exact health status of the visitor, and there is no prior health history available in the U.S., insurance companies wouldn't be able to analyze the risk they are getting into by offering coverage to the visitor. Therefore, they simply don't offer coverage to visitors in the United States.
Please keep in mind, even when domestic health insurance companies offer short term health insurance to U.S. residents, the plans offered won’t cover pre-existing conditions. Even if a domestic company offered health insurance to visitors, it wouldn't necessarily provide better benefits than the visitor health insurance available for them.
Furthermore, a visitor health insurance plan is a short term plan that you can purchase instantly and provides coverage from the next day onwards. On the other hand, US residents can only enroll into domestic long term health insurance plans during the open enrollment period, which typically occurs towards the end and beginning of the calendar year. Also, please note that domestic health insurance plans are many times restricted to one state or geographical area. (The United States is not united for insurance purposes. Every state has their own rules.) Most domestic health insurance plans don't cover individuals over the age of 65 years as U.S. individuals are expected to enroll into Medicare at 65. Furthermore, they don't provide benefits like emergency medical evacuation, repatriation of remains, lost luggage, or other important benefits that would be included in visitor health insurance plans, which are recommended for travelers.
I heard that pre-existing conditions can't be excluded in a group plan. Can I buy group visitors health insurance?
Even though the paragraph below applies to domestic customers, it is necessary to explain that first to answer the question.
Domestic group health insurance plans that are normally available through an employer may provide wider coverage than the domestic individual health insurance plans, but this is not always the case. No matter which insurance company, the bottom line is, “What will an insurance company receive from a particular block of business vs. how much they are paying back in claims?” If a husband and wife open a small business and decide to get group health insurance for themselves, in most cases and in most of the states, it wouldn't be significantly different from the individual health insurance they could get as a couple. Obviously, they won’t get the same benefits and pricing as an employer that has 10,000 employees. The benefits and pricing will differ because if 100 employees are sick and seeking treatment out of 10,000 employees, the remaining 9,900 employees are in relatively in good health; therefore, the insurance company will overall make money. However, if there are only two people in the group, and one of them is very sick, the insurance company would have an overall loss.
Visitor health insurance is available on a group insurance basis only for 5 or more travelers. That simply provides the convenience of one application, and is generally 10% cheaper than the equivalent individual insurance. It does not provide any additional benefits, such as covering pre-existing conditions. If it did, the insurance company would still end up losing money in that block of business.
Why should I purchase an individual visitor health insurance? Why can't we form a big group of all the people who go to XYZ temple or church, all the people who visit XYZ web site related to activities such as immigration, all the people who are members of XYZ organization and so on? Wouldn't that be cheaper and provide better benefits?
No, it does not work like that. You can only get true group health insurance (other than travel group insurance, described above) if the participants are employees of a specific company and work for that specific company as full-time employees. The major reason for those members to be together is to work for their employer's business and not to enroll into the group health insurance. The employees of a company are a tightly controlled group and there is a significant effort involved to be a part of that group. Also, there are restrictions, like the minimum level of participation requirement and so on. In other words, getting group insurance is secondary to the employment purpose.
Loosely defined groups, such as everyone going to XYZ temple or church, would likely only get relatively sick people trying to join their group insurance, as there is no obligation for everyone to join the temple group. In this type of group, the majority of the people joining that group would be the ones that need insurance right away. In other words, "Do you have pre-existing conditions that you would like to get treated? Just visit XYZ temple, sign up, pay a small fee for your surgery” and then say, “Goodbye". That means, the insurance company would end up losing more money than they would collect, putting them out of business. The same concept would apply for any other groups made up in this manner.