18 May 2021

The pitfalls of self-funding medical care for overseas employees

Covid has meant that many medical procedures and operations across the globe have been delayed or cancelled. The issue is likely to continue for some time, so employers with staff overseas need to consider the options for supporting health and wellbeing.

Indeed, an international study1 estimated that over 28 million operations would be cancelled or postponed globally during the peak 12 weeks of disruption due to Covid: over two million operations per week. The overall 12-week cancellation would be 72.3% worldwide.

With over 90%1 of the cancellations being for non-life-threatening disease, these routine operations may not be critical but are certainly likely to have an impact on an individual’s wellbeing and their ability to work. The lack of treatment will come to the fore in the coming months and employers should, therefore, consider the options for looking after their employees and minimising absences, including how they are going to fund healthcare. If employers do not have international healthcare in place they may consider self-funding*, but this has its pitfalls.

Employers must be careful to understand the implications of self-funding, particularly depending on the area in which their staff are based. With unpredictable costs and no NHS to fall back on, Towergate Health & Protection is warning employers of the pitfalls of self-funding versus IPMI for employees overseas.

Sarah Dennis, Head of International at Towergate Health & Protection comments: “There is a vast difference between opting to self-fund in the UK, where you might have a vague guesstimate at the sorts of costs involved, and deciding to do so for overseas employees. Medical costs differ wildly in other countries and the implications of intending to self-fund can be huge. Whilst those in the UK may choose to wait for an NHS appointment, this is not an option abroad where this is no NHS.”

For example, a hip replacement in the US costs on average $40,364 (£28,993), and a heart valve replacement costs around $170,000 (£122,110)2. Fixing a broken ankle can cost around £5,000 in Germany or £6,500 in Hong Kong3.

There are huge unforeseen costs that could have to be borne by the employer if international private medical insurance (IPMI) is not in place. Travel insurance does not offer the same level of cover as IPMI, as it typically has a number of exclusions, so employers must remember that this is not adequate for employees working abroad.

Unexpected costs

While Covid has been, and continues to be, an issue around the world, many employees have not been able or willing to attend their usual check-ups and so the situation of delays and extended waiting lists is likely to escalate. As well as procedures for known conditions being delayed, it is likely that there are many undiagnosed problems yet to surface. This could result in a huge bill for employers once things start unlocking again, and it would be wise for employers to consider implementing a healthcare policy now before the situation deteriorates.

Sarah Dennis comments: “Far from being an added cost, IPMI can help control costs as well as offer preventative care, helping to keep overseas employees and their families healthier, happier and more productive.”

Self-funding for operations and medical care is so called when the individual pays themselves for treatment when it is needed – as opposed to using other options such as medical insurance (or the NHS in the UK). Equally, employers may choose to fund medical care if they’re keen to assist an employee and get them back to work.


1. Elective surgery cancellations due to the COVID‐19 pandemic: global predictive modelling to inform surgical recovery plans - - 2020 - BJS (British Journal of Surgery) - Wiley Online Library
2. https://www.debt.org/medical/hospital-surgery-costs/
3. https://www.axaglobalhealthcare.com/en/wellbeing/global-access/unexpected-health-costs-abroad-infographic/
4. Conversion rates by Morningstar on 21.04.21