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Looking at medical insurance inflation in China

As we reported last week, we have released our latest report on international private medical insurance inflation (IPMI). The report is available as a free download now from our website here. As we mentioned in the last article, IPMI premiums in China inflated by an average of 12.06% in 2016, up from 9.50% in 2015. In this article, we take a look at how China compares regionally when it comes to medical inflation and some China-specific drivers behind the increased inflation.

 

Medical insurance inflation in China compared with Asia

From the chart below we can see that IPMI plans in Asia saw an average inflation of 9.90% in 2016, which was slightly higher than the global average of 9.22%. This is intriguing in that it could indicate an emerging trend where inflation in Asia will track higher than globally.

For 2016 however, China was not actually the location with the highest health insurance inflation, that honor went to Hong Kong which saw premiums inflate by an average of 13.03%. This would put China as having the second highest average inflation figure of the countries included in the report. The third highest is Singapore, which saw an average inflation of 11.18% in 2016.

China’s location as the country with the 2nd highest average medical insurance inflation is not overly surprising, especially when you look at our Cost of Health Insurance 2016 report which found that China was the third most expensive country for health insurance out of 95 countries.

 

Breaking China’s inflation down by insurer

Aside from presenting the average inflation figure for the country, this report also presents the average inflation by insurer.

As you can see from the graph above, inflation in China ran anywhere from 6.62% to 31.21%. As with the global ranking of insurers: Allianz Worldwide Care, AXA PPP Healthcare, Bupa Global, and William Russell are all among the providers with the lowest inflation.

One thing to note here is that IntegraGlobal’s 31.21% increase is not reflective of the premiums they charge – they are not charging the highest premiums in China. Rather, their inflation figure shows an adjustment to market rates, putting their plans about on par with the other providers in the country.

 

Country specific IPMI inflation drivers

In the report, there are 7 drivers of IPMI inflation identified as having an impact on a global scale:

  • New medical technology
  • An imbalance of healthcare resources
  • Increased compensation for healthcare professionals
  • Healthcare overutilization
  • Unstable economies
  • Changing population dynamics
  • The increasing availability of technology

Insurance in China, especially health insurance, has certainly been affected one way or another by the above drivers, especially unstable economies, changing population dynamics, and imbalance of healthcare resources. Of the above drivers one of the most influential is changing population dynamics.

Everyone who has lived in, or followed China’s rise to prominence has seen a drastic shift in population wealth. According to an article from Business Insider in 2015, China has the largest number of millionaires in the world, with the number expected to grow in the near future. Beyond that, China also has the largest middle class in the world. What this has equated to is a larger number of people with spending money.

As such, people in China are increasingly demanding better products including better health care, with an ever increasing number of high net worth (HNW) individuals seeking care from private hospitals. This increase in demand has seen the number of private hospitals boom in the country, and with it have come higher prices. To offset this, local HNWs have been increasingly turning to international health insurance as a way to offset the costs.

Pacific Prime’s China office has certainly seen an increase in the number of local HNWs securing coverage and submitting claims. This, in turn, leads to higher costs for care and therefore higher premiums.

Interestingly. It is well known that the number of HNW expats in China is decreasing. This should lead to a decrease in demand for IPMI, but the opposite is happening. The higher concentration of HNW local citizens demanding coverage is looking to eventually eclipse demand for coverage in China and therefore continue to drive an increase in inflation figures.  

While increasing demand and changing demographics is certainly not the only factor driving IPMI inflation, it is highly likely that it is one of the most important, especially for China. In the future, it would be entirely possible to see inflation continue to increase, and could possibly remain higher than the global average.

To learn more about IPMI inflation, the other drivers, and how the other countries are ranked get your FREE copy of the International Private Medical Insurance Inflation – 2017 report on our website now.  

Posted by rmcbroom in Health Insurance
Insurance options for kids going to school overseas

Insurance options for kids going to school overseas

If you are planning on sending your child overseas for education, you undoubtedly already know there are a number of things to consider. One such thing to consider is your child will need health insurance. Here, we take a look at the common solutions available to parents whose children will be traveling abroad.

 

Common insurance solutions for students studying abroad

When going abroad for work or study there are usually a number of health insurance solutions available for people to consider. Here is an overview of the 3 most common types of health insurance secured by students studying abroad.

Travel insurance

These plans are designed to provide emergency medical cover to people while they are outside of their own country. Generally speaking, most travel insurance plans are a set period in length, usually providing cover for either individual trips of up to a set number of days or numerous trips of a set length (usually less than 30-60 days) over one year.  

Travel insurance plans are popular for students studying abroad not only because they offer medical coverage but they also cover other travel related incidents such as flight delays, lost luggage, and even emergency medical evacuation back to your home country.

The one thing to be aware of with these plans is that they are not designed to provide elective medical care while overseas, rather they are designed for medical emergencies and provide just enough coverage to see you well enough to return to your home country. If you plan on going to the doctor while studying abroad, the visit likely will not be covered by this plan.

Health insurance from a local provider

Almost every country popular with students will offer some form of local insurance. These plans are designed to provide citizens and residents of these countries with adequate health insurance coverage in that country only.

Generally speaking, there are two types of local insurance available in most countries:

  • Local plan offered by a private insurer – These are plans designed and sold for and to local markets by insurers who have licenses to operate within that country.
  • Coverage provided by the government – These are plans or coverage offered by the local government.

As mentioned above, local health insurance plans are designed to provide adequate coverage for most residents. In most cases, people with these plans will be visiting the public health sector which in many countries is subsidized by the government. As such, you will usually find that these plans have relatively low levels of coverage, or have limits placed on the amount you can claim for care.    

It should also be noted here that while many countries have health care or health insurance sponsored by the government, there are usually strict requirements as to who is eligible for this type of care. A good example of this would be Singapore with their Medisave program. Permanent residents and citizens of Singapore pay a percentage of their monthly income into a savings account that can then be used to cover the cost of healthcare for themselves and their family.

This savings account is not available for foreigners, which means their children would also not be able to benefit from the offsetting. If they were to get sick, they would need to pay the full cost to see a doctor.

Another example of this would be in Canada where all citizens and many residents have access to provincial health care, and students are required to have health insurance. The issue is, in some provinces, foreigners are not eligible for provincial insurance. This means that you will need to secure a plan from a private insurer.  

Health insurance from an international provider

The other common option for students going abroad is an international health insurance plan. These plans, offered by the global or international branches of major insurers, provide worldwide coverage. In other words, your child will be covered in your home country, the country they study in, and any country they may visit while overseas.

International health insurance plans are also designed to offer high coverage limits which means you can visit nearly any medical center and receive quality health care. These plans are popular with many expat families and companies who send their employees overseas as they afford the policyholder the ability to visit top quality healthcare.

The main concern many people have with these plans is that they are considerably more expensive than local or travel coverage.

 

Does my child actually need insurance while studying abroad?

This can actually be a fairly tough question to find a concrete answer to. Some schools and countries will require a valid insurance plan to be secured in order for a visa to be issued while others will simply recommend it.

For example, if your child is going to the going to school in the US, it is mandatory for some student visa holders to secure health insurance coverage that meets ACA (Affordable Care Act) requirements within the US.

One of the best pieces of advice we can offer is that it would be a good idea to contact the university or school your child will be attending. The reason for this is that some schools will actually offer coverage as part of the school fees. This is particularly common for schools in the UK, Canada, Australia, and even some in the US. These plans are usually local cover only and are affordable, however they may not be available to some students or will often have fairly strict limits and rules attached to how the plan can be used.

And of course, in many cases, it would be advised to secure a health insurance plan for your child in case they get sick and need to visit a doctor.  

 

Which health insurance plans should I purchase for my child?

In Pacific Prime China’s experience, it would be advisable to secure both a travel insurance and an international health insurance plan. The reasoning behind this is that the travel insurance plan will cover your child while they are traveling between your home country and the country their school is located in. There is always a chance that their luggage could be lost, or there will be delays while traveling (especially during the winter in the northern hemisphere) and having coverage to help offset the additional costs these bring can be a big help.

When it comes to actually living in their new country, an international health insurance plan will help cover the costs of any care needed. This is especially important in countries like Hong Kong, Canada, the UK, and the US, where the cost of health care can be prohibitively expensive if you don’t have access to the government/public health subsidies. These plans will also cover your child when they are at home and can have additional coverage elements like dental, and vision added thereby allowing your child to visit a dentist while they are at home on break.

One of the major advantages an international health insurance plan offers for children studying overseas is the fact that they will usually have emergency evacuation coverage. This means that if your child gets sick while at school you may be able to get them moved back to their home country, or a location where relatives are who can help them recover.

If you are looking for a health insurance solution that will cover your child while they are overseas, contact Pacific Prime China today. Our experts will be happy to discuss your options and help you find a plan that meets your whole family’s needs.   

Posted by rmcbroom in Expat Health Insurance, General Insurance
Govt clamps down on foreign insurance in China

Govt clamps down on foreign insurance in China

Over the past two or so years, there has been a constant financial trend in China that has piqued the interest of investors, companies, and governments alike: The continued capital outflows out of the country. According to the Wall Street Journal, as of September 2016, capital outflow from China has been recorded in each of the previous 24 months. The article goes on to note that the outflow for the year is pegged to be just over USD 400 billion. While this is certainly high, the Chinese government has been taking steps to reduce it. These steps are varied both in scope and success with the latest being a tightening of regulations around foreign insurance products in China. In this article, we take a look at the two latest regulations and what it means to all people considering insurance in China.

 

The first regulation: Using UnionPay cards to pay for insurance outside of China

First off, it is important to note here that clampdowns by the Chinese government on insurance products are not a new thing, especially when it comes to actions that are aimed at stemming the constant capital outflow. In fact, this is the second such action taken in less than a year. Back in March of this year, we wrote an article on the regulations introduced around the purchase of insurance products outside of China using Chinese bank cards, more specifically UnionPay cards.

With this regulation, holders of UnionPay cards issued in China had a limit of USD 5,000 per transaction on insurance products. Recently, the Chinese government decided to take this regulation another step further.

In late October, UnionPay (which is the national credit and debit card issuer in China) announced that they were going to start halting the purchase of almost all insurance products in Hong Kong for people who use UnionPay cards issued in China.

What this means is that if you have a UnionPay bank card, including both debit and credit cards, that was issued by a bank in China, you will not be able to buy most insurance products outside of the mainland using that card.

The small bit of good news around this recent announcement is that there are some exceptions to this rule: You can still buy insurance plans that are related to tourism, such as travel insurance.

The second regulation: Cracking down on the sale of foreign insurance products in China

The second regulation introduced at the end of October is directly related to the sale and purchase of foreign insurance products, only this regulation focuses on foreign products available in China.

According to the Asia Insurance Review, “Officials of the Chinese insurance regulator CIRC have recently visited foreign life insurance firms and intermediaries in Beijing as part of investigations into the illegal sale of insurance products in Hong Kong to mainland Chinese.”

What appears to be happening is that some unscrupulous insurers are selling insurance products from locations outside of mainland China, mainly Hong Kong, to citizens in the country.

The CIRC is cracking down on these insurers primarily because some, not all, are selling using methods that some perceive to be misleading and are in fact selling what the government views to be illegal products.

What does this mean for people looking for insurance?

The problem that you need to be aware of here is that it is illegal for companies in China to sell insurance plans from foreign institutions that don’t have a license to operate in the mainland. This means that if you purchase one of these plans and have problems with say submitting a claim, you will have no legal means of recourse which pretty much equates to not having effective coverage.

The biggest thing to point out here is that if you are looking for insurance in China, it is advised that you buy a plan from a licensed insurer within China. That said, if you are looking to purchase plans in another country, e.g., you have purchased property in Hong Kong and need to secure fire insurance, it would be far better to purchase coverage from an insurer in that country, not from an insurer/company in the mainland offering coverage in that location.

 

What about those holding international health insurance plans?

If you already have a plan in place when you move to China there should be no problems regarding the legality of coverage as it was secured before you move to the country. But if you are already in China and are looking for a plan, it would be advisable to select plans offered by insurers with a license to operate within the country.

The reason for this not only has to do with legality of coverage – almost all major international insurers offer legal plans in China – but due to the fact that onshore plans (those sold within China) offer a number of additional benefits including:

  • The ability to pay in RMB
  • CIRC protection in litigation cases
  • Plans are serviced locally – This is very important for major issue like case management, etc. as insurers on the ground will have a greater understanding of local regulations and the healthcare system
  • Fapiao invoices are available
  • Larger direct billing network, including with some public hospitals

In our experience, if you are going to be living in China then it is generally a better option to secure an international health insurance plan from a China-based insurer, especially if you plan on seeking medical care within the country.

 

How can you identify health insurance plans that are legal in China?

The easiest way to do so is to work with a licensed broker like Pacific Prime China. Almost all of the major international insurers and plans we work with globally are available in the country with most of the insurers working with local partners. We only sell products that are legally licensed to be sold in China meaning you receive top quality coverage without the potential hassle of legal issues.

If you are looking to learn more about your health insurance options, please contact us today.

Posted by rmcbroom in Expat Health Insurance
Tips on comparing health insurance plans in China

Tips on comparing health insurance plans in China

In the past couple of decades the number of insurers in China has increased from but a handful to over 100, a market which is predicted to do nothing but grow in the near future. This is a great thing for many consumers as many of these insurers offer a wide variety of insurance products, with a large number focusing just on health related insurance products. The one downside to this is that not all plans are created equally and when you start to compare health insurance plans in China it quickly becomes apparent that there is a vast difference in the quality of plans available. This makes it hard for many of us to actually find a plan that best meets our needs.

To help make this process a little easier, Pacific Prime has recently released a new infographic. This infographic, available for free from our website, covers the three most important things you should keep in mind when looking for a new health insurance plan.

Here, we take a look at the three elements and how they can help you wade through the huge number of plans available, to find the best plan for you.

Element 1: The price

When many people start looking for health insurance, the price is arguably the single most important thing they will consider. After all, if a plan is out of your budget then you likely won’t be considering it, no matter how good it is. The thing here is that when considering international health insurance plans you may be shocked at how much they can cost.

With high limits and international coverage, this type of health insurance plan is designed to help cover the cost of care at not only the best private facilities in China, but also abroad. Simply put, they allow you to pick which hospital you want to receive care at. The thing is, many of these facilities are expensive (some hospital visits can cost upwards of USD 100,000)  and the cost of health care is increasing, so premiums will be higher for these types of plans.

While the price you pay to secure this type of insurance may be higher, it does offset the high cost of care and makes them completely worth it for many living in China. That said, the premiums for these types of plans will vary considerably especially if you use an online health insurance comparison tools like the one available on Pacific Prime China’s website.

Take for example, the below screenshot of the plan premiums our online comparison tool prepared for a 30-year-old female living in China:

Image showing the cost of health insurance in China

As you can see, the premiums cover quite a range with the lowest being RMB 522/month and the highest being RMB 1,516. This is just the first 9 results of close to 300 plans available to consider. The question is, why is this range so high? There are two main reasons behind this:

  • Some plans are quotes with deductibles – This is the amount you will need to pay before medical coverage will kick in.
  • Some plans will offer different levels of coverage – Plans are designed to often cover different types of care and with different limits. Generally speaking, plans with higher premiums will cover more.   

When looking at plans online, it is important to look at a number of elements aside from just the price. For instance, the plans in the image above have different levels of coverage and some even have deductibles. This will change the overall premium you pay, and the good news is that you can usually play around with the level of coverage offered.

It is also important to note here that it would be a good idea to determine your level of risk aversion when considering plans. What we mean by this is try to think about how much you are willing to pay each year or each doctor’s visit before your insurance will cover the rest (the deductible). If you are financially stable and feel that you won’t visit a doctor on a regular basis then a higher deductible could be considered, as it will reduce your overall premium.

On the other hand, if you are considering visiting a doctor on a regular basis then a high deductible may not be the be right decision financially.

Element 2: The level of cover

Insurers in China offer health insurance plans with three major levels of cover:

  • Inpatient only – These plans will only cover medical care where you are admitted to a hospital by a doctor, usually for more than 24 hours.
  • Inpatient + outpatient – These plans add on outpatient cover which includes care at clinics and care where you are not admitted to the hospital.
  • Inpatient + outpatient + maternity – Covers both of the above as well as maternity. Many insurers will refer to this level of coverage as “full-cover”

Of course, as you look around you will notice that some plans will vary from the levels of coverage above. For example, some may offer dental or optical coverage instead of maternity, etc. Generally speaking, however, these extra benefits (e.g., dental, optical, wellbeing, etc.) will be considered as add-ons meaning you can certainly add them to your plan, but will need to pay an extra premium if you want them to be covered.

What we suggest when looking at different plans is to add and remove levels of coverage e.g., outpatient, dental, vision, etc. This can give you a good idea of how much you can expect to pay if you want to secure a plan. Bear in mind here that the more coverage elements you add on, the higher your premium will be.

Element 3: How you will use your plan  

The final element to consider when comparing health insurance plans in China is how you plan to use your insurance plan. In some cases, you may have a pre-existing condition or will require extensive medical care. If this is the case for you, it would be advisable to keep this in mind when comparing plans. The reason being that some plans will not cover pre-existing conditions, others may deny coverage completely, while others yet may add what’s called a loading (an extra premium you need to pay for your condition to be covered).

You will need to discuss this with your broker or the insurer before purchasing a plan, as this could drastically change the level and type of coverage you secure.

Beyond that, it is important to note that the service level offered by insurers varies drastically. What we mean by this is that when it comes to things like paying claims, submitting information, securing the plan, disputes, etc. you will find that insurers vary in quality. Some will pay claim reimbursements within days, others may take months and followups. This can be annoying for some, especially if you secure a reimbursement plan where you need to pay for care out-of-pocket and then submit a claim.

One way to not only uncover the best health insurance plan in China is to talk with Pacific Prime China. Our team has an in-depth understanding of the market in China and uses tools like our free infographic to help you identify a plan that not only meets your budget but also offers the level of coverage you require.

Contact us today to learn more.   

Posted by rmcbroom in Expat Health Insurance
Breast cancer and your health insurance in China

Breast cancer and your health insurance in China

October is a month of many things. Expats throughout the country have likely started making plans for the winter holiday or CNY, while others are getting ready for the end of year. But this month is important for another reason: It’s breast cancer awareness month. Each year, organizations, health professionals, governments, and even companies around the world launch pink ribbon campaigns that strive to increase the awareness of this all too common cancer that could affect an estimated 1 in 8 women in their lifetime. Without a doubt, breast cancer awareness has increased but there is still confusion surrounding this cancer, especially when it comes to health insurance coverage.

 

Breast cancer in China

Like in many other countries, breast cancer is the most common type of cancer among women, with the most recent figures from the WHO’s Cancer Today 2012 putting the incidence rate in China at 22.1 per 100,000 people. This equated to around 187,213 new cases in 2012 alone. In a country of over 1 billion people this may not seem like a large number. After all, China’s breast cancer incidence rate is among the lowest in the world. The thing is, looking at the historical figures provided by the WHO, it appears that the incidence rate is increasing.

In fact, this article on Sciencedirect reports that the incidence rate has been increasing at nearly twice global rates. The latest statistics available, from 2015, seem to corroborate this trend.

Cancer Statistics from Wiley Online Library report that in 2015 there were just under 269,000 reported cases of breast cancer in the country. This is around a 43% increase in the number of cases in three years.     

The statistics available from Wiley Online Library also show an intriguing correlation between breast cancer and location in China. For example, women in urban settings like Shanghai, Beijing and Shenzhen are 2.4 times more likely to be diagnosed with breast cancer than those living in rural centers.

Beyond that, it would also appear that the average age at which women are diagnosed with breast cancer in China is actually considerably earlier than in many other countries. As the statistics from the report linked above show, the majority of breast cancer cases in China are found in women aged 45-59, which is considerably earlier than other countries like the US where the average age at diagnosis is 65.

The good news here, if you can call it that, is that the mortality rate of breast cancer in China is not increasing as fast as the incidence rate. This is largely due to the fact that, when caught early, the disease has a high survival rate. The Science Direct article linked above reports that the 5-year average survival rate was 73% from 2003-2005. Bear in mind here that this includes all stages of the cancer. This makes it the most survivable form of cancer.   

 

The cost of breast cancer treatment in China

Breast cancer, like other forms of cancer, has a strong survival rate if it is caught early. One of the best ways to do this is to have a regular mammogram. Doctors recommend that women over the age of 30 talk with their doctor about how often they should have a mammogram, and that women over the age of 45 have a yearly scan. The thing is, the price of this scan will vary. For example, Beijing’s United Family Healthcare center offers a Wellness in a Pretty Pink package which includes cancer scans for a cost of RMB 6,680. Just a mammogram scan will likely cost anywhere between RMB 100 to RMB 1,000 depending on where you receive care.    

Should you be diagnosed with breast cancer, the cost of treatment will vary drastically depending on where you receive care. For example, this report hosted by the National Center for Biotechnology Information looked at the cost of breast cancer treatment at Sichuan Cancer Hospital. It found that the average cost of breast cancer treatment (including surgery and chemo) was RMB 160,457. It further breaks down the average cost by stage:

  • TNM 0 stage – RMB 37,941
  • TNM I stage – RMB 122,622
  • TNM II stage – RMB 159,594
  • TNM III stage – RMB 215,014
  • TNM IV stage – RMB 214,229

Of course, these figures will be drastically different in each city and hospital. For example, ChinaDaily reported on a new cancer center in Guangzhou Knowledge City that offers proton therapy (a form of highly targeted radiotherapy). According to the article, the cost for each course of treatment is around RMB 200,000 to RMB 250,000. Add to this the cost of surgery and any extra doctors visits, and it would be entirely possible to see a full course of treatment balloon up to RMB 400,000.  

 

Will health insurance cover treatment?

The short answer here is, “Yes, health insurance plans in China will cover breast cancer.” The thing to be aware of is that not all plans will cover the complete cost of treatment. This is especially true for local health insurance plans and the social insurance plans we pay for via our taxes.

Both of these types of plans will have lower limits when it comes to cancer treatment. For example, some plans will only cover 65% of treatment, while other plans will only cover care at certain public hospitals. This could leave you with considerable bills to pay.

Beyond that, it should also be noted here that some local health insurance plans will not cover scans like mammograms unless they are deemed medically necessary by doctors. Also, if you have had breast cancer in the past, some insurers may refuse to cover you or will attach a higher premium and waiting period for breast cancer claims.

Luckily, there are plans available in China that do cover the high cost of treatment. The best example of these plans would be international health insurance, which usually offers higher limits and will cover more conditions. These plans will also all cover breast cancer treatment, and a few are even starting to offer coverage of mammograms and other scans. While they will likely still reject coverage of people who have recently had breast cancer, there are plans that will consider extending coverage if you have been cancer free for a number of years.

It should also be noted here that these plans are international in nature, meaning they will allow you to seek treatment in your home country or another nearby country. If you are looking for a plan that will fit your health care needs, contact Pacific Prime China today.

Posted by rmcbroom in Illness