China Expat Health Insurance the Do’s and Do nots when buying insurance

Question

I’ve observed a number of posters make comments on this forum regarding expat health insurance in China. I thought it might be interesting to share a little bit of information on the local scene from someone inside the business.

When choosing health insurance in China it is important to consider three principle issues;

- the insurance benefits you need
- the insurance company you choose
- the insurance broker/agent you work with

Level of Insurance Cover

Despite popular misconception, China is not a “cheap” location to receive medical treatment – some of the most expensive hospitals in the world are located here and annually we have medical claims that comfortably exceed US$100,000.00. Our two largest claims in the last three years have been as a result of accident, which is the number one cause for medical treatment amongst expatriates in China. Therefore, just because you feel healthy, unless you have significant financial resources, you are literally taking your life in your hands by living in China uninsured.

The very minimum cover you should obtain would be an inpatient only plan, which covers you in the event of hospitalization. These maybe high cost events, that stretch the budgets of all but the wealthiest patients and can be covered by an insurance company for a relatively small premium.
The second cover you should look for is emergency evacuation cover through which the insurance company should not only cover the cost of any true emergency but also be in a position to arrange it. In most cases this cover will be unnecessary in the large cities such as Beijing and Shanghai but should be considered if travels are likely to take you to the less developed locations in China or the rest of Asia.

Plans that include outpatient treatment, for trips to the doctor, are all well and good but they are substantially more expensive and maybe out of the reach of some budgets.

Your Insurance Provider

You can currently split the insurance companies that offer health insurance in China into three groups - legal domestic, legal international and illegal international;

Legal domestic health insurance plans are typically sold by the large local insurance companies and will generally offer health insurance cover in China only, for relatively low benefits for an inexpensive premium. They will probably not be adequate if you wish to seek treatment at the high-end medical facilities.

Legal international plans such as our own, are local legal plans offered by international companies or local companies working with an international partner, that can offer full worldwide cover (in addition to China), broad benefits and a higher premium although hopefully a premium that is more competitive than those currently charged in the U.S. or Europe.

Illegal international plans are plans illegally sold into China from offshore insurance companies that aren’t registered to trade in China and generally offer full benefits but for a full international price. Although they are often sold by very reputable companies and should work fine, there is no legal recourse in China if you have a dispute (as they aren't here!) and there is always a risk that the government will intervene and stop local medical providers from dealing with them.

Your Insurance Salesman

In the same way that you should take care with your insurance provider you should also be aware of your insurance salesman. Agents and brokers also have to be licensed to sell insurance products in China and although I do not believe it is illegal to purchase a product from an unregistered source it is certainly illegal to sell it. Therefore, it is always prudent to confirm that your broker or agent is legally licensed to sell insurance in China or alternatively you can purchase your product direct from the insurance company.

Therefore, in summary;

DO at least purchase a plan that covers admission into the hospital and evacuation
DO ensure that you purchase your plan from a legally registered insurer
DO ensure that you purchase your plan through a legally licensed broker/agent

DON’T leave the decision until something happens
DON’T forget to check your current plan to ensure it covers your requirements

Paullie · Answer

I would like to make some additional important comments that you need to look at when buying medical insurance in China , and I am not an insurance broker so I don't have to favour any particular company at all.

Independent insurance brokers make their revenue on what they sell you, so may put forward one insurance over another to make more money depending on commissions etc. So not always in your interest but in theirs. Read the fine print and make sure you know what you are getting for your money as stated above. 

Often the low risk items will provide huge amounts of coverage and the high risk items coverage have low thresholds to avoid expensive claims. Healthcare here and in some of the centers of medical excellence is very expensive, sometimes exceeding costs in the US and other international centers.

As far as the evacuation cover goes, it is not just about the coverage, you can be insured for ten million $$ but if you don't have someone to get you out of China when you need it, then you are stuck here, and I certainly do not agree with the comments on Beijing and Shanghai necessarily being acceptable - they are not if you come from a country with superb healthcare (sometimes just acceptably good). So when you choose your insurance make sure that they are affiliated to a medical assistance company for evacuation that has a presence in China or who is able to do an evacuation out of China properly in an acceptable time frame, and that you don't end up staying here because the insurance tells you this is an ''acceptable international standard" only because they don't have the means to get you out, and because they don't want to spend the money; remember they are insurances, so they make money on premiums and not on spending money on their clients, so they will obviously do all they can to keep costs down, with what could sometimes be construed as 'acceptable healthcare' based on personal perceptions.

For the record, I don't make money out of moving or referring patients to any healthcare provider or insurance/assistancec company, I am a salaried employee and have the interest of my clients at heart to ensure they get the best possible care - I can write a book about some very unfavourable outcomes due to poor/inappropriate health insurance cover or the total lack thereof in China as well as other parts of Asia.

pdmoz · Answer

Thanks for the feedback Paulie and the comments made.

Your implication however that health insurance companies prejudice the health of their clients to save a dollar is a general statement that can't be applied across the board. There are good and bad insurance companies and practices in every country as there are good and bad examples of medical facilites and assistance companies but I for one know that we would never risk the health of our clients by suggesting sub-par treatment.

We are a for profit company and we therefore have an obligation to ensure that every dollar spent is spent in the most efficient manner to ensure the best possible outcome for the client. We also have to consider our other policy holders and ensure that the premiums we charge each year are within their expectations and not inflated by unnecesssary treatments that provide no benefit other than to inflate the bill.

With reference to medical treatment in China, everyone has anecdotal evidence of medical treatment going wrong in every part of the world but I have factual evidence that in my three years in this business in Shanghai we have only been involved in three cases of alledged medical malpractice and ironically all three cases were at Western orientated facilities.

Far from suggesting Chinese medical facilities are perfect, I am simply stating that they are not as bad as many scaremongers would have you think and evacuation is of course, no walk in the park. For a case to require air evacuation it is by implication extremely serious and will certainly not be improved by any additional delay in arriving at a medical facility and the additional trauma suffered through air travel and the logistics involved.

If good quality and effective treatment is available locally it should always be considered first to maximise the chances of a complete recovery for the patient. Certain conditions such as transplants would automatically qualify for evacuation but other conditions should rely on the opinions of those qualified to make them such as the local attending physician, physicians working with the assistance company and those intending to receive the client in the offshore location. Efforts have to be focused on achieving the best overall outcome for the client.

Cheers.

laowaiguoren · Answer

I once had an international medical insurance policy from the States.

Became injured on a remote jobsite ouside a third tier city.

This required xrays, bloodwork and stitches at the local hospital, paid cash.
Never received a reimbursement check.

So, will all hospitals/clinics here in China accept and provide treatment without payment?

Is it required to first get approval/pay bill - then submit any fapiaos to the respective insurance firms?

It would be helpful to all here if you could attach a PDF file or provide a company website which shows what is covered and/or the limits of standard procedures/fees.

What are the pre-existing condition terms, catastrophic coverage or disease restrictions?

Kindly identify the specific coverage if there are different plans, annual costs, deductables, co-pays, etc.

pdmoz · Answer

Oviously I can only speak on behalf of my company so provided you except that all company terms and conditions can be different I'm happy to provide you with the benefit of my experience here.

NO is the answer to your first question. Many hospitals outside of the Tier 1 cities and indeed, many public hospitals within Tier 1 cities will not except direct billing arrangements for the simple reason they don't need to. They don't need the extra customers and they don't want the extra work of providing credit to insurance companies that are often offshore and may or may not pay for the treatment provided - cash is king. A number of insurance companies and third party networks have had some success in penetrating the Chinese hospital system but the coverage is by no means complete. In our case, for outpatient treatment, we have the client pay and claim but for an inpatient case where the hospital will not except credit, we have a network of agents nationwife that run along to the hospital hauling a bag of cash! I have no idea why you weren't reimbursed by your original insurer.

With reference to pre-authorisation, in our case this is only necessary if the member needs to be admitted into the hospital. In the case of an emergency the hospital will have an additional 12 hours to contact us to ensure that treatment isn't delayed whilst trying to obtain pre-authorisation. Outside of our outpatient cashless network all outpatient treatment is pay and claim.

With reference to pre-existing conditions, again, all the companies are different. In our case, for individual plans, we impose a 2 year waiting period for all conditions that occurred in the 2 years before the plan started. We are not considering coughs, colds and other common ailments but we focus on those clients that have serious ongoing conditions that purchase insurance with the full intention of making claims significantly above their premium contribution. These clients prejudice our results and also impact the other members who through subsequent premium increases are subsiding their treatment. Once 2 clear years have passed without treatment those conditions considered pre-existing are once again covered.

With reference to available plans and premiums etc., I don't want to turn this post into a sales pitch for our product as I believe that by providing honest opinions we are already marketing our services however if you do want more information about out products either contact me

China Expat Health Insurance the Do’s and Do nots when buying insurance

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