The escalating cost of medical treatment is now so horrendous that by 2020 health care combined with old age pensions will, if things continue as they are, bankrupt the US and the major European EU countries. Already over 40 million Americans have no medical cover at all. They can’t afford it and increasingly, employers won’t pay for it. Millions more Americans are only partially covered. Insurance companies refuse to pay for much of the necessary treatment and drugs, so that even a relatively minor illness can wipe a family out financially. In Europe and other developed countries, where national medical schemes cover all citizens, the system is on overload.
Expatriates are in a particularly vulnerable situation when it comes to medical cover. There are only a limited number of options open to them and they do not suit everybody. The first thing to know is that these schemes are really designed for businessmen and their families, who are only overseas for a limited number of years and will, either before or on retirement, return to their original countries. For those who are offshore forever, they may well not suit.
Expense: Getting good cover for you and your family is not cheap. Medical costs go up every year and so does your premium, anything between 3% to 12%. Then you get age bracket hikes, which escalate rapidly when you hit 60. One option is not to get “expat” health insurance at all. It may suit you better to fly back to Australia or Europe and avail yourself of the national health system prevailing there.
Who’s insuring you? It is not easy for the average consumer to know whom they are really dealing with. Medical insurance is a business like any other and the people behind it are in it to make money. There’s no national referee or Ombudsman to turn to out in the world. You’re on your own with your insurer and they are the ultimate decision maker. What happens if they go bust, decide to close down or sell out to another company? Where does that leave you? Often it leaves you uncovered. They can boot you out and as an expatriate there’s not a lot you can do about it. Believe me, it happens, and with reputable companies too.
It’s more than the small print......
Most people have a hard time reading the small print. People like to believe if they’re covered and get sick they get looked after, period. Alas, not so. The problems usually occur in the areas of “exclusions” and “chronic” conditions. You are usually advised at the outset what conditions won’t be covered. Chronic conditions are harder to judge. Who decides when a condition is chronic? Does it mean if you get a disease once and then whenever you get it again your insurer can refuse to pay because it’s chronic? I can assure you that is exactly how some insurers proceed. The point is, even if you do read the small print it may not leave you much wiser because it is all in the interpretation of the small print.
With drugs and other adjuvant treatment, which can be vitally necessary after a major procedure and very expensive, you can’t know how you’ll do until it happens. To what extent will your insurer cover the costs of this? Is the amount offered anything like adequate and for how long they will pay it? If you get it wrong you can be ruined.
What kind of cover can I expect for my money......?
If you go for a good policy you can expect to pay anything between US$2,000 to $4,000 per annum per person increasing to the higher amount as you near 60 years old. You should expect at least US$1.0 million p.a. coverage of all surgery and hospital fees, plus follow up treatment. However, as noted, how much you can spend on drugs and adjuvant therapies vary and are often capped. You should also get medical evacuation included as an option within such an amount and everyone would be well advised to do this. Your premium will probably be sufficient to allow you to be treated any where you chose in the world, except the USA. For the US you can expect to pay as much as 60% of the premium again.
What happens after age 60?
Here’s where you need to be careful. Make sure your insurer just doesn’t kick you out on retirement aged 65. Some actually do this, but most of the good companies won’t. They’ll cover you as long as you live, that is if you can afford the premium. And this is the point. After age 60 the premiums start escalating big time. If say you’re paying US$3,500 p.a. at 60 you might be looking at over US$12,000 p.a. in your 80’s. And that’s at today’s prices. Remember medical costs go up 3% to 12% per annum and all insurers pass this on to you. Compounded over the period this means your annual medical cover could well be in excess of $20,000 a year a decade or two on. The time to think about all this is in your 40’s, when the insurance company’s still want your money, but you need to think long term and few people do.
Your friendly broker.....
Brokers come in all shapes and sizes. Good , bad and indifferent. A good one can be really helpful but you must always remember that they make their money from commissions on what they sell you. Always do your own due diligence. Even the most saintly broker is going to accentuate the positive and pass over the shortcomings. You need to be able to get a word in edgeways too. If they don’t listen they’re unlikely to establish what your needs are. Brokers can be helpful in presenting claims in a favourable light but they are not doctors. The merits of any claim is not their decision. It doesn’t help you if they inflate their influence. To complicate matters further, you may fall foul of local politics and find that what your local broker tells you gets contradicted by the company’s national office in Jakarta.
The good & the bad….
I have deliberately not named the major medical insurers available here in Bali, though I have evaluated them all and certainly could rank them if I wished. However, I like a quiet life and have no desire to complicate my life. But I’ve no problem telling you about the best and the worst, both reputable companies.
Company “A” is the worst. It is has the cheapest premiums and you are covered accordingly.You can be reasonably sure that if you have a heart attack or something serious happens they will pay for the procedure. They are not crooks. It is with follow-up treatment and out patient conditions that you are likely to experience problems. This company harasses doctors and creates a blizzard of paperwork. They question almost everything and will reject anything they can as chronic or pre-existing. If you pay to cover chronic conditions the amount is derisory. Premiums escalate rapidly as you age.
Company ”B” is the Rolls Royce of expatriate medical insurance. None of the others come close. It is slightly more expensive but not much. But once you reach age 60 the premiums do not increase. The lock off at around US$4,300 p.a. for the rest of your days, even if you live to 120 as a chronic invalid. None of the others do that. And it’s great cover too. They pay up promptly and without question. The premium allows you to elect for treatment anywhere in the world and to any doctor you want, including the USA. What is more, and I know this from personal observation, they are extremely proactive in ironing out any problems you may face when it comes to payment and scheduling. The only thing wrong with them is they’re picky about whom they let in and can add loadings to the premium. It’s best to get in early, but once in you can actually sleep at nights, you’re covered chronic, pre-existing and all.No question.
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