Beyond Borders: Navigating Medical Tourism and Disability Management

/ By Cowan Insurance Group

With wait times growing exponentially for specialists, surgeries, and medical investigations across Canada, many Canadians are looking to other countries to obtain care faster. This is known as medical tourism, and it is becoming more common. For employers who offer an income loss benefit to their employees, such as a short- or long-term disability plan, or for employees relying solely on employment insurance benefits, there are important considerations which should be taken into account before an employee leaves the country for treatment. Not managing or documenting these situations properly could impact an employee's loss of earnings eligibility during their recovery time.

What is it?

Travelling outside the country for non-emergency medical care is known as medical tourism.

Why would an employee choose out-of-country medical care?

  • Faster access to treatment. Canadians wait, on average, about 44.3 weeks1 for orthopedic surgeries, not including the wait time to first see the specialist. A hip replacement can be secured in Delhi, India, within days.
  • Low costs for treatment. Although Canadians do not have out-of-pocket costs for healthcare, there are costs associated with waiting for treatment (increased paramedical costs, lost time from work, etc.). Some private surgery options are available but are costly. A hip replacement will cost approximately $12,000 CAD,2 while the same surgery in Delhi, India, will cost roughly $4,300 CAD.3
  • More treatment options. Certain experimental treatments or alternate treatment options are not available in Canada but are readily available elsewhere. These most commonly include certain forms of bariatric surgery, cosmetic surgeries and cancer treatments.

Help your employees live healthier lives.

Are there disability policy implications?

Yes. Most policies have limitations on benefits being paid to employees who are out of the country unless there has been prior agreement to pay benefits during this period or require the third-party adjudicator to approve the travel. There may also be provisions around benefits only being payable for medically necessary procedures.

A standard disability policy includes the following language:


  • Benefits may be denied, suspended, or terminated for any period the Employee:
    • Is absent from Canada longer than 4 weeks unless previously approved by COMPANY or in accordance with the Employment Insurance Act or for the purpose of undergoing medical treatment.
    • Disabilities due to plastic surgery solely for cosmetic purposes, except where attributed to illness or injury.

Emergency Situations

Some situations can arise while an employee is out of the country and suffers a medical condition, causing them to be disabled, e.g., broken leg, heart attack, emergency surgery, etc. In these situations, disability benefits (STD or LTD) or employment insurance (EI) could be approved for income loss benefits. Supporting medical information would be required to be submitted as per the client's policy. Disability benefits would often then start the day of their incident/illness/surgery, etc. (or after the appropriate qualifying period).

Note for the Employment Insurance Act4

If you travel outside of Canada, you're not usually eligible to receive sickness benefits while outside Canada. However, you could be eligible if you're obtaining medical treatment that isn't readily or immediately available in your area of residence.

Readily or immediately available definition

55 (1) Subject to section 18 of the Act,5 a claimant who is not a self-employed person is not disentitled from receiving benefits for the reason that the claimant is outside Canada.

  1. for the purpose of undergoing, at a hospital, medical clinic or similar facility outside Canada, medical treatment that is not readily or immediately available in the claimant's area of residence in Canada, if the hospital, clinic or facility is accredited to provide the medical treatment by the appropriate governmental authority outside Canada

Patients in Canada have the right to receive appropriate and timely care, and it's legal to travel abroad to access healthcare.

Disability benefits may be payable to employees in these situations if they meet the provisions of their policy. However, employers have valid concerns when it comes to employees choosing medical tourism as part of their treatment plan. There are always risks that employee absences will be prolonged either because of health complications or the decision to enjoy the "tourism" component of their travel.

Best Practices for Disability Claims Management

When faced with a disability claim or absence for an employee seeking treatment out-of-country (or during a vacation), be sure to review policy language to confirm if benefits may be impacted when the employee is out of the country.

How is a medical tourism/out-of-country claim handled?

  • The Case Manager will assess the claim on the basis of total disability; is there a medical condition requiring treatment? Will that treatment result in a total disability?
  • If so, discuss the claim with the employer in general terms to let them know travel is required for medical treatment. Disability benefits will not be payable for travel to/from the treatment destination unless the employee is totally disabled during those periods.
  • The Case Manager will request a statement from the employee's Canadian physician confirming the nature of the condition, the treatment being sought, and the reason for the treatment being sought outside of Canada. The employee will be responsible for providing this written statement.
  • At the Case Manager's discretion, the employee may be required to provide ongoing medical evidence from their out-of-country physician in English or French.
  • The Case Manager will set the following expectation(s) with the employee, again based on the policy provisions:
    1. Disability benefits will only be supported for periods of total disability supported by objective medical evidence.
    2. Return travel details should be confirmed and shared with the Case Manager before departure.
    3. A return to Canada for rehabilitation/recovery is expected as soon as the employee is medically stable to travel.
    4. The employee will be expected to participate and be available for any offer of modified or accommodated work
    5. The employee must maintain reliable access to communication (e-mail, telephone) for ongoing claim management.

If all of the policy provisions are met, the claim will proceed as per normal processes while the employee remains totally disabled and compliant with the disability policy, including, where noted, participation in any rehabilitation (RTW or accommodation) planning. It will terminate at its natural conclusion or at such a time when the employee becomes non-compliant or no longer meets the policy terms and provisions.

Notes for your employees

It is important to ensure that staff are aware of the rules and policies around travelling out of the country and the impact it might have on their coverage or disability claim. Employees should seek approval for any out-of-country travel for medical reasons prior to leaving. Employers should ensure all policies are clear, written and shared so there are no surprises.

When there is a sudden illness or medical event for the duration of a vacation, the employee should be classified as 'on leave/disability/EI' from the date of disability. An employee on vacation is considered to be 'at work' as long as there is no break in their coverage for benefits. This may result in an employee 'getting back' any vacation time that wasn't taken because of a disability that occurred.

Medical tourism can offer quicker access to care, ultimately resulting in less lost time from work, but it is essential to understand the rules and implications. If you have any additional questions on how medical tourism may impact your employee benefit plan offerings, please reach out to a benefits consultant.


  1. Moir, M., Barua, B., Wannamaker, H. (2023). Waiting Your Turn Wait Times for Health Care in Canada, 2023 Report. Retrieved from URL.
  2. Canadian Institute for Health Information. (2023). Hip and Knee Replacements in Canada: CJRR Annual Report. Retrieved from URL. 
  3. Care Hospitals. (n.d.). Hip Replacement Surgery Cost. Retrieved from URL.
  4. Government of Canada. (January 24, 2024). Travelling outside Canada to receive medical care. Retrieved from URL.
  5. Government of Canada. (February 6, 2024). SOR/96-332. Retrieved from URL.

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