Getting sick on vacation can definitely ruin your plans, but being hospitalized while abroad can be financially devastating. U.S. News and World Report reported a story in 2008 of Trish Watlington who ended up in a hospital in Tortola while on a sailing trip in the British Virgin Islands. She had a high fever and her vital signs were unsafe. In order to employ an air ambulance to transport her to the closest hospital, they required an $8,000 upfront payment and a doctor who would agree to see a foreigner. Trish received the Medical help she needed and the illness was attributed to a mysterious virus.

Many families, like the Watlingtons, don’t realize that there is no 911 service outside of the United States and they don’t give much thought to the “what-ifs” while traveling abroad. For most, vacations are enjoyed and everyone returns home safely, but when sickness strikes abroad, many don’t realize that payment is required on the spot and, in some countries, even before treatment. To add salt to the wound, most health insurers including basic Medicare, will not cover any costs outside the country. For those who will provide coverage abroad, it is usually at the cost of a much higher deductible, provider restrictions, and other limits.

There are two kinds of medical travel insurance: travel medical and medical evacuation. Typically they are sold as package policies and also include trip cancellation and trip interruptions. Travel medical insurance generally covers medical bills up to a certain amount while medical evacuation picks up the tab if you need to be transported from a hospital, removed from a cruise or evacuated from an emergency situation. Some national health-care plans provide limited coverage for their members when they travel outside the U.S. and some don’t provide any coverage at all. Additionally, most health-care plans do not provide coverage for medical evacuation. A medical evaluation in countries where there is inadequate medical care may cost up to $100,000 for a single trip.

The cost of travel insurance varies depending on whether you purchase a package policy or only medical and medical evacuation coverage. Package policies that include trip cancellation, interruption, baggage and travel delay, as well as medical and emergency evacuation typically costs 4-8% of your total trip cost.
 
In order to avoid a financially devastating illness while abroad, check the fine print on your health insurance policy and consider whether supplemental insurance makes sense. A separate travel policy can be purchased for around $100 and will fill in the gaps left behind by typical domestic insurance plans. These are often bundled with trip interruption and cancellation insurance, and it can be purchased directly from suppliers or through travel agents and tour companies. For most travelers, this extra insurance is probably unnecessary, but does provide a safeguard against the unknown. If you have an underlying medical condition or are headed to a destination in which you'd rather not undergo surgery or hospitalization, it might be worth the extra cost for peace of mind.


By Matt Reynolds - Google+