New trends in private health care insurance in Belgium Contents - - PowerPoint PPT Presentation

New trends in private health care insurance in Belgium

26/04/2004 2

1.

The Belgian health care insurance system in a nutshell

2.

New developments in the complementary health care insurance market

Contents

26/04/2004 3

1.1. A generalised and generous social insurance

N Generalised social insurance covering up to 78% of total

health care expenses (budget 2004 : 16,3 bn EUR)

N Employees : inpatient and outpatient care N Self-employed : essentially inpatient care (this difference will

disappear in the near future due to harmonisation reforms)

N Based on a price list defining the tariffs, the level of the legal

reimbursement and the co-payment of the patient

N Supplements can however be added by the provider N Time-gap between recognition and reimbursement

N Complementary social protection via Maximum Bill on co-

payments for low incomes (450 EUR)

26/04/2004 4

1.2. State controlled, but privately executed

N Organised by a

governmental institution (RIZIV/INAMI)

N Basically financed with

social security contributions (85%) and completed with government subsidies (15%)

N Executed by private non-

profit organisations (sickness funds)

Sickness funds

44% 29% 15% 12%

Christian Socialist Independant Other

26/04/2004 5

1.3. Actual scope of private health insurance

Total health expenses Legal 78% Not insured 18% Insured 4%

Assuralia (2002)

N Complementing social insurance covering

N co-payments, supplements and not yet legally reimbursed medical

items

N Private insurance : limited importance wrt total health cost,

but growing at a rate of 14% pa (1995-2002)

N Not insured expenses mostly related to ambulatory care

26/04/2004 6

1.4. Actual scope of private health Insurance

N Wide-spread cover for inpatient care (in % of Belgian

inhabitants)

N 30% via group insurance N 10% via individual insurance N 20% via sickness funds N Insurance market of outpatient care is quite undeveloped

because of

N fiscal barriers for employer sponsored plans N and inefficient administrative processes

not an adequate value proposition

26/04/2004 7

1.

The Belgian health care insurance in a nutshell

2.

New developments in the complementary health care insurance market

Contents

26/04/2004 8

2.1. Towards more private insurance …

N Total health expenditures increase from 9% to 19% GDP

Forecast Budget-GAP

5 10 15 20 25 1 9 9 8 2 3 2 8 2 1 3 2 1 8 2 2 3 2 2 8 2 3 3 2 3 8 2 4 3 2 4 8

% of GDP

Legal Insur. 6,64% Gap Other

Assuralia (2002)

26/04/2004 9

2.1. … with a layer system

N Private insurers are conscious of their role as a partner in

health care insurance

N Process of increased benefits in social insurance for

unhealthy and low incomes already ongoing : maximum bill and higher reimbursement of chronic diseases

N Budgetary constraints lead to an increase of the uninsured

market

N Private insurers will have to deal with access to insurance

26/04/2004 10

2.2. Towards more regulation ….

N No specific regulation for health care insurance N Upcoming regulation to guarantee N A life-time health insurance N continuity when leaving a group insurance N and life-time contracts in individual insurance N Access to an affordable health insurance (inpatient care) N non-applicability of selection at entry in group

insurance

N access to individual healthcare insurance N Limited impact of pre-existing conditions

26/04/2004 11

2.2. …. proposal of private insurers

N Proposal of private insurers (inpatient care)

N Guarantee access for a standard cover (excluding the private

room)

N With a maximum premium amount N Organise a solidarity mechanism for uninsurable risks

between insurers

26/04/2004 12

2.3. Towards customer responsibility …

Segmentation

N The darker the more

expensive for inpatient care

N Two main solutions

N a geographical premium

segmentation

N or a behaviour driven

reimbursement segmentation

26/04/2004 13

2.4. Towards more service …

N Most insurers recently adopted TPP-systems for inpatient

care

N Medi-Assistance : based on the concept of assistance N MediCard, Assurcard : based on the concept of a credit card

N TPP-systems generally increase healthcare costs N At this stage, the impact on claims cost is not yet quantified

26/04/2004 14

2.5. Towards a level playing field …

N Sickness funds also offer complementary insurances in

competition with private insurers

N Insurance regulations are not applicable N Advantageous tax legislation

N The Belgian courts judged

N that sickness funds are operating on the market as far as

complementary insurance is concerned

N that a different legal framework is not in contradiction with the

principle of equal treatment wrt Belgian legislation

N The question is whether these judgements are compatible

with European legislation : illegal government aid and insurance directives

26/04/2004 15

Conclusion

N A turnaround for complementary private healthcare

insurance in Belgium

N As a valuable partner for the government N In a competitive customer-focused environment