Year 2015 - The New Challenges of Insurance Regulatory Reform 保險業新規管 帶來的新機遇

專題探討 FEATURE D. Guaranteed acceptance with premium loading capped at 200% of standard premium for all ages within the first year of the VHIS launch, and those aged 40 or below starting from the second year of implementation of VHIS Guaranteed acceptance under this VHIS Standard Plan is desirable. But citizens over age 40 should not be forced to buy such VHIS within the 1st year after its implementation. Due to ageing population in HK, many people are still under employ after age 60. Majority of the people who are enjoying group medical insurance under employ will not take up this low benefit limit VHIS until they retire. On the other hand, younger generation is more mindful of their financial situation for housing and family responsibility rather than to buy such VHIS. The cost of VHIS is also not cost effective enough to induce people to buy it. In the 2010 Healthcare Consultation, the Government proposed to allow people up to age 60 to buy this VHIS in the 1st year with guaranteed acceptance. It is very reasonable to reduce the maximum entrance age to age 40. E. Cost- sharing (deductible and /or co-insurance) restrictions i. This is only applicable within VHIS Standard Plan, but not benefiting consumer outside the Standard Plan. Currently in the private high end insurance market, consumers can opt for a self-chosen deductible for return of premium discount. e.g. some hospital insurance can enjoy over 50% premium discount if consumers opt for an annual deductible of HK$40,000. Consumers need to have rights of self-chosen annual deductible. The benefit of deductible is not only for consumers’ premium discount; it will also reduce the administrative work of tiny hospital claims to insurers. Deductible should be allowed in the Flexi Plan. ii. After the implementation of VHIS, there will be no exclusion of pre-existing conditions. What insurance companies can do is either barring proposers with many pre-existing conditions from joining or to impose very high premium for policyholders. F. Budget Certainty Consumers will welcome budget certainty. The Government should also regulate healthcare service providers including individual doctors by introducing diagnosis-related group (“DRG”) package fee and codified information for all surgical procedures as it was proposed in the 2010 Healthcare Consultation Document. Consumers expect to have DRG based package pricing for common procedures, so that there are listed DRG package pricing to facilitate certainty of hospital charges. If the Government considers that it will take a relative longer time to develop an operative system to track the cost of common procedures, they should at least include the tracking of codified information in VHIS by report from each healthcare service provider on each surgical procedure: P Disease Code P Treatment Code P Drug Code The movement towards greater standardization of coding and charging is common practice in many developed healthcare systems, including Australia, France, Germany, Ireland, Japan, Netherlands, Switzerland, UK and the USA. Even Singapore and Taiwan have adopted such model. Only if the society is able to track the aggregate data, regulate insurance companies and healthcare service providers (including individual doctors), we cannot have budget certainty. In the absence of pricing transparency, medical inflation will become more acute given the short supply of private hospitals and doctors in HK. G. Existing hospital insurance pools will become “DEAD POOLS” Any existing insurance plans currently selling in the market will become “DEAD POOLS” on the implementation of VHIS. None of the current available hospital insurances are covering all pre-existing conditions; hence they will become non-compliant products and will not be allowed to sell. The existing “dead” pools will be ageing and will only have more and more claims within these pools without healthy new blood joining. The Government is going to penalize good citizens who have planned their own private medical insurance long time ago. It is expected that the future renewal insurance premium will be too expensive to be affordable. H. “Pool” or “Community” Rating The Document should impose “pool” or “community” rating in the minimum requirements for individual medical insurance so that it is level premium for all individuals under the same age (except premium loading for covering any pre-existing illness). Without “pool” or “community” rating, individual can be heavily penalized with sharp hike of renewal premium immediately after any major claim payment, because insurance companies can price out any individual when this individual’s health situation is deteriorating, although it is still under guaranteed renewal. 24 2014 年刊與 2015 展望 YEARBOOK 2014 & PROSPECT 2015