Anyone who has ever considered buying health insurance in China for themselves or their family may have ended up purchasing whichever policy someone recommended rather than what they actually needed, simply because of the topic’s complexity. In all markets, but especially those like China, the options can be overwhelming, both in terms of the number of policies available and the variety of benefits and services they offer.
What is important when looking for health insurance in China?
First of all, you need to decide what kind of protection or health insurance you are looking for and what kind of benefits are important to you. Different life stages may require different levels of protection. For instance, if you are 24 year old, and single and just are starting out in your career it’s important to be insured. However, you probably won’t need – or may not even able to afford – the sort of insurance policy that someone with a family may need. A family policy may including outpatient, check-ups and vaccinations and perhaps even dental included in their their coverage, rather than buying an health insurances that offers only hospitalization coverage.
In addition, many people in China consider purchasing critical illness (CI) or accidental death & dismemberment (AD&D) insurance policy rather than real medical insurance plan. This is often because they’ve been misinformed by a salesperson or unscrupulous insurance agents, or because it’s simply much cheaper in comparison. CI and AD&D are insurances where the insured person receives a lump sum in the event of any insured event happening, but that doesn’t mean that your medical bills are paid! Medical insurance on the other hand will take care of hospital bills, which is the most important part if you are involved in an accident or become seriously ill. The lump sum from any CI or AD&D policy will probably not be enough to pay for everything, and you will have to wait to receive the money, which may be too late.
Another point to take into account is that a small amount of people living in China are covered through a long-term travel (medical) insurance rather than real individual private medical insurance. This might seem like an affordable alternative idea, but let’s have a look into the consequences. The idea of a travel insurance is to help the insured with the financial burden of treatments in case of an accident or illness while travelling (but not residing) – so far so good. But, after you have been treated and the hospital bills are paid (which you may have to pay upfront and claim later when insured through a travel insurance; which is especially common in China), travel insurance rarely pays for follow up treatments. However, follow up treatments can be just as important as surgery or the original treatment itself. In addition your travel insurance may not be valid if you hold a residence permit or work permit in China as you are no longer ‘traveling’.
Furthermore, the idea is that after being treated abroad the travel insurance company may repatriate or help to arrange the return to your home country or country of residence. Once you are home your medical insurance is then supposed to come into force. But what if you don’t have that medical insurance and only rely on a simple travel insurance while residing in a third country? It’s also worth bearing in mind that, many travel insurance plans have a cancellation clause in the case of any insured event happening, meaning they may agree to insure you to the end of the policy year but won’t insure you after that. But now you have a pre-existing condition, and no insurance.
Therefore, you should purchase proper health insurance while you can. What level of benefits is best for you is up to you; but following is an overview and further explanation of the main benefits that any health insurance is able to provide:
The core component and foundation of any insurance package is in-patient or hospitalization coverage. Everyone should have at least a hospitalization health insurance plan regardless of age, fitness, and health history. There are always major costs when it comes to in-patient care. Such basic plans usually provide cover when a patient has been hospitalized (needs to stay in hospital overnight), but many plans also provide coverage for daycare treatment (usually at least six hours even if not overnight). In catastrophic incidents, it’s important to realize that the potential costs could run into the hundreds of thousand RMB. In-patient coverage plans typically include services such as medical evacuation (transport from the accident site to hospital) and medical evacuation (transport to a different hospital if the current hospital cannot treat your condition).
The approximate cost of a hospitalization health insurance plan is between CNY 500/month and CNY 1,600/month depending on age, area of cover and cover limits.
This term is mainly used for any doctor or physician consultation and treatments including specialists, which do not require admission to a hospital. Out-patient ranges from going to the doctor because of a cold, to an emergency room visit, as well as minor or out-patient surgeries and treatment of long term conditions, such as diabetes, which need regular follow up appointments. More than 70% of all claims associated with health insurance fall into the out-patient bracket. Therefore it can be a key component of any insurance package especially if you have children who can be the main users of out- patient care.
Out-patient plans cannot be purchased without in-patient coverage. The coverage limits can range from a limited CNY 10,000 up to the millions. Most plans cover medical practitioners, prescription drugs, specialists, diagnostic testing, and vaccination fees. Some plans will also include eye examinations and prescription glasses, chiropractic treatments, herbal medicine, acupuncture and visits for psychiatric care.
The approximate cost of a health insurance plan including Outpatient: an additional 60% – 150% of the in-patient premium.
Dental coverage varies widely depending on the insurer and the treatments are never fully covered under any insurance policy. The coverage will be up to a maximum amount, and will incur co-payments. Most dental plans included in health insurance cover include preventative procedures such as cleaning and polishing, as well as simple routine treatments such as inlays, plus major treatments such as bridges. Dental prostheses or orthodontics on the other hand are not always covered. Emergency dental care is often covered within any In-patient coverage.
The approximate cost of a dental plan on top of a regular health insurance plan is between CNY 250/month and CNY 1,000/month depending on age, area of cover and cover limits.
Check-ups Including Vaccinations and Wellness
Medical check-ups are specifically provided to see if there are any underlying problems that have not yet surfaced but which may affect your health. This is something that is highly recommended as anything caught early can be treated efficiently and cost effectively. Looking after your well-being is always critical. Being able to keep on top of your health before it gets on top of you is key. With a wellness package, insurance companies will cover you for an annual check-up looking at a range of issues for example, cancer screening.
The approximate cost of a check-up plan on top of a regular health insurance plan is between CNY 250/month and CNY 500/month depending on age, area of cover and cover limits.
This is the term is used for any medical costs arising from pregnancy and childbirth. Maternity benefits will cover the cost of prenatal and postpartum healthcare for expectant mothers, as well as the delivery of the baby. The costs of maternity care in China are relatively high; especially at private clinics, and it is important for any young woman or family to ensure the welfare of the newborn child. If a child is born without any Insurance, and there are unforeseen medical conditions, the baby would not be covered at all for the condition after the birth. Neonatal intensive care can costs thousands of US$ a day and some of the highest medical bills we’ve seen have arisen from this. One important thing to note is all maternity plans have a 12 month waiting period, meaning if you want your future pregnancy to be covered you need to purchase maternity insurance before you start making or adding to your family.
The approximate cost of maternity cover on top of a regular health insurance plan is between CNY 1,200/month and CNY 1,500/month depending on age, area of cover and cover limits.
Area of Coverage
The area of coverage defines the geographical area where the insured person can seek elective treatments. For health insurance products in China there are usually four areas of coverage available: Mainland China only;Greater China (including Hong Kong, Macau and Taiwan); worldwide excluding the US; and worldwide including the US. Some products may also have an option for Asia. In addition, many insurers provide emergency cover outside of the actual area of coverage, which is important to know. If you work and live in China, but only travel once in a while to other areas then a China-Greater China insurance plan may work perfectly for you.
Which insurance providers can I choose from in China?
Each insurance company and their products have their strengths and weaknesses. There is no “best health insurance”; your choice should depend on your individual circumstances. Here’s a list of the major reputable health insurers in China that you’re likely going to end up choosing from. These companies are licensed or work with licensed partners to sell their insurance products.
CIGNA — One of the largest health service organizations in the world. Outside China Cigna has a great reputation, especially amongst US expats, and offer a competitive product. Unfortunately, this isn’t the case for individual plans in China where they have partnered with China Merchants Bank. For group plans on the other hand, Cigna is a great provider anywhere, including China.
Aetna — an American-based Fortune 100 company with the biggest platform for healthcare management. They are partnered with China Life, the largest Chinese insurance company and offer a range of products including the former Ultracare medical insurance products provided by Interglobal (this was bought by Aetna in 2016).
AXA Tianping — Apart from Allianz,AXA is the biggest insurance company in the world. AXA Tianping Property & Casualty Insurance Company Limited (“AXA TP”) is the largest foreign capital property insurance company in China. AXA TP’s new health division is solely for medical insurance in China, and it is is committed to providing competitive products and great service. With the merger between TianPing Auto Insurance Company Limited and a wholly-owned subsidiary in China of AXA, AXA TP offers a variety of general insurance products, and it is committed to provide customers with prompt, convenient and reliable insurance services, across the board.
ICBC AXA — The main company behind this is the bank ICBC while AXA is a minor shareholder which has little involvement with the ICBC AXA company.. Their products originate from Interglobal which was running the health insurance under ICBC-AXA. But as Interglobal was bought by Aetna, ICBC bank itself is running the medical insurance as a separate division. Their plans are very competitive, but their service needs to be improved.
Ping An Health — A ShenZhen based company that has a unique wellness program called Vitality, which keeps track of one’s health and offers discounts for those that maintain a healthy lifestyle. Compared to many Chinese insurance companies their products are considered to be at the lower end, but the premiums are not as low as you would expect. The value for money ratio for Ping An’s health insurance products is not as good as for most foreign brands.
MSH — belongs to Siaci Saint Honore group in France. In China they are operating as third-party administration company providing medical insurance solutions underwritten by the China Life insurance company.
Allianz — German-based and the largest insurance company in the world (depending on which numbers are being compared). Allianz products are well designed for the Chinese market and are competitive in price and service. They have one of the best claims’ administration services in international medical insurance.
Global Benefits Group — They claim to be the “largest independent, fully integrated provider of international benefits in the world”. Partnered with Taiping Life, they have one of the largest insurance networks in China. However, GBG does not focus on individuals and is therefore more suitable for group medical insurance.
Now Health — A relatively new medical insurance provider, founded in 2004 in HK, and which has spread across the region including Mainland China. However, their operating license in China is run under API. They provide high level medical insurance and good service.
More health insurances providers are available, but those detailed above are the most popular and most established individual private medical insurers in China.
How to decide which health insurance with which benefits?
You should begin by speaking with your insurance consultant at your insurance broker to make sure that you get proper advice. The more information you are able to provide the better your insurance consultant will be able to help you in finding the most suitable option for you.
If you don’t know anything at all about the costs for health insurance, then you may ask first for an overview of quotations for inpatient only care as well as quotations including outpatient for China only to get a basic idea. However, if you do know about the estimated costs set a budget for yourself based on your income and the amount you are willing to spend for your healthcare.
Generally speaking, a hospitalization plan is a must have for everyone; no-one should burden themselves, their family, or their friends with the financial risk of unexpected accidents or illnesses. Hospitalization treatment can cost well in excess of CNY 100,000. It is possible for anyone to pay for general outpatient services themselves, especially if using normal public hospitals, rather than private medical facilities. The risk, however,is that in case of any long-term illness (chronic or otherwise), the financial risks are not clear. A long-term diabetes, or dialysis treatment for example can cost you more than any inpatient treatment. Nevertheless, if you young, healthy and have just started your career you may be a hospitalization plan may be adequate.
If you are already a bit older and able to pay a bit more then you are better off considering including outpatient care because, as mentioned, this can be as much of a financial risk as any unexpected accident if not included.
A big consideration for any woman or young couple is pregnancy care (maternity benefits). Child birth in China’s private medical facilities is expensive, but there are also some more affordable solutions available. To include Maternity in your insurance plan first ask for quotations to understand the prices and perhaps even check with some hospitals to get a feeling of the costs there too. It is possible to get just maternity complications covered under your inpatient plan and pay the actual pregnancy care by yourself through a package provided by the hospital. This way you may save some money overall, compared to including Maternity into your insurance plan; especially as most hospitals are keen to provide discounts, if paying cash and buying packages upfront. Being without maternity complication coverage however is something no-one should consider as the risk is simply too high.
The benefit of dental coverage is debatable. The value for money ratio on dental coverage for any individual insurance policy in China is usually not great. An annual dental check-up including cleaning isn’t really expensive at any dental clinic, and even if you need some minor routine treatments the costs aren’t that high either. On the other hand if you need any really serious dental treatment it won’t be covered in full as any dental insurance rider has a cap and there are always co-pays. Unfortunately, you cannot carry over any unused dental benefits from the years where you have not used much. Overall over the years you will pay more for the dental coverage than you will receive in benefits. Dental coverage in China has nothing to do with risk management; it is purely a mathematical equation about how much you pay in and how much you can get out at most.
Everyone needs to think about which what coverage is necessary for them. A medical insurance plan with coverage just across China will work for most people perfectly as they are mainly based in China and leave the country only for holidays. Therefore,an additional short-term travel medical insurance can be much more cost effective than an insurance plan with worldwide coverage. However, if travelling frequently, an insurance plan with international coverage is highly recommended. Not only is it easier to handle with just one insurance and you can be sure that you’re covered, but also these insurance plans usually offer better coverage.
Other useful knowledge when choosing health insurance
To know what kind of benefits you need and what regions you need to be covered for is just one part of the story. There are some facts that many people overlook. These facts are usually listed in the fine-print or policy wording in insurance terms.
Many new medical insurances offer two different types of underwriting terms you can choose from. The most common type is FMU – full medical underwriting – with the other being Moratorium (please talk to your insurance consultant about the pro and cons for your individual case).. Some insurers in China are also offer CPME, a continuation of previous medical exclusions, which is helpful if switching from one insurer to another.
→ FMU: under these terms an applicant needs to fill out the medical questionnaire within the application form. This will be fully reviewed and evaluated by the underwriter. The result of the underwriting can be exclusions or inclusion for a pre-existing condition, a loading on the premium or a decline if the pre-existing condition is very severe.
→ Moratorium: this term refers to a period of time or waiting time, normally 24 months after the start date, where any pre-existing condition will be covered after that period as long as no treatment for this condition was needed during the qualifying period. In practice most insurance companies have their own definition and this varies from insurer to insurer.
This is the period you are not able to claim certain benefits under your insurance policy. While insurance companies cover the risk from the moment the insurance policy starts,, to ensure that no condition that existed prior to the start date will be covered, waiting periods have been implemented for certain benefits under most health insurance products in China. This mainly applies to dental (up to 6 months) or maternity (up to 12 month), but some insurer even have implemented waiting periods of up to 30 days for inpatient or outpatient benefits.
This is the amount you have pay yourself each policy year before any costs will be covered by the insurance. Deductibles are usually a fixed amount per year per insured person.
This is a percentage of the medical bill the patient has to pay, which is not reclaimable. Co-pays may be applicable for both inpatient and outpatient treatments, and also for dental and maternity treatments
Similar to co-pays, but these are not set as a percentage. It’s a fixed amount per treatment that would not be covered by the insurance.
Hospital Access and High Cost Medical Clinics & Hospitals
Private individual medical insurance in China usually covers all hospitals within your area of coverage – public as well as private. A unique term applying only to China and Hong Kong however is High Cost Medical Clinics and Hospitals. Certain facilities in the greater China region are classed as luxury facilities with treatment costs beyond average and even comparable with charges in the USA. These luxury clinics and hospitals are either excluded, covered with a co-pay, or fully covered. To include such facilities fully the insurance premium can be up to 30% more expensive than without.
Generally following hospitals / clinics are considered High Cost at insurers in China:
- United Family Hospitals and Clinics (Beijing, Shanghai, and other cities if any)
- Parkway Health Clinics (Shanghai)
- Shanghai East International Medical Center
- Beijing International Medical Center
- International SOS Clinics (Beijing, Tianjin, Nanjing, Shenzhen)
- Hong Kong Adventist Hospital
- Matilda International Hospital (Hong Kong)
- Hong Kong Sanatorium & Hospital
Outpatient Direct Billing
Direct billing is a term for outpatient treatments where your bill will be directly paid from the insurer to the clinic or hospital. Most hospitals in China (especially private ones) have contracts with many insurers so that they pay directly for treatments and doctor’s visits. Different insurers will offer direct billing for different services. Find out what services the insurer allows direct billing for and what the treatment limit for outpatient direct billing is before you need a treatment guarantee letter.
The downside of outpatient direct billing is that you may have to wait for some time after the treatment until the billing department at the hospital are able to confirm the successful outpatient direct billing process with the insurer. Therefore, it is better to inform the insurer before receiving treatment, which may speed up things afterwards.
Treatment Guarantee Letter / Direct Settlement
A treatment guarantee letter is official approval from your insurer for a specific treatment. Guarantee letters are issued outpatient treatments that are expected to be more costly such as surgeries, but also for any scheduled inpatient treatments. Issuing a guarantee letter can take up to five working days and it depends on submitting all the required documents from the doctor. Make sure you receive your guarantee letter and that your treatment is covered before you go to the hospital for treatment. For minor treatments no insurance company will provide a guarantee letter; if direct billing isn’t available you may have to pay and claim, which will save you time anyway.
After you have been treated the hospital will deal with the insurance company and they will settle the bill directly. This will also be the case in any emergency situation where you have been unable to inform the insurer upfront; but as long as you have informed them as soon as possible then there should be no problem. If you have your insurance card with you the hospital should inform the insurer.
Some standard exclusions are found in every insurance plan – depression, alcoholism, self-inflicted injuries, car or motorcycle races, active participation in acts of war or terrorism. However, there are a number of important exclusions that vary from insurer to insurer and it makes sense to take a good look at the policy wording.
This is usually the biggest single issue with any new health insurance contract. You will often hear that insurance providers consider pre-existing conditions on a case-by-case basis or offer insurance excluding pre-existing conditions. This usually only occurs when the problem was non-serious or minor (e.g. a rash, an allergy), conditions that are localized and don’t affect other areas (e.g. an elbow injury) or one-time occurrences (e.g. after effects from an accident that last a limited time). Anything really serious or that can lead to other problems in the future will usually lead to you being refused coverage outright. As a general guideline if the condition is a major reason that you’re seeking insurance, they won’t accept you. Beware of insurance providers that accept you and don’t check about pre-existing conditions until you actually make a claim: it’ll give you a false sense of security.
Nevertheless, there are a few insurance companies which are able to provide coverage for pre-existing conditions for a premium loading. The premium loading is indeed a case by case decision from the underwriter at the insurance company and can range up to 100%. However, it’s better to have certain coverage with a premium loading instead of having uncertain coverage for a particular condition without premium loading. But this also depends on each individual circumstances.
Chronic conditions are conditions which are usually ongoing for at least six months or need medical attention on a regular basis (even if it’s just once a year). Some insurers have limitations on the coverage of chronic conditions; some even have lifetime limits (which is something that everyone should worry about). Especially in the case of outpatient coverage, some of the really expensive claims are chronic diseases (asthma, high blood pressure, diabetes, kidney diseases…). Should you receive an offer with lifetime limitations on chronic conditions you may want to check other options instead.
Sexually Transmitted Diseases
Usually all insurers exclude coverage of any STD, unless it was not your fault (e.g. due to a blood transfusion) but the burden of proof may be on you. In addition, there is usually a limit on expenses that are covered relating to HIV specifically (plus a minimum waiting period of 24 months for HIV; usually 48 months). In any case, keep in mind that the majority of STD-related expenses are outpatient and unless you opt for outpatient coverage, you won’t be covered for those.
There is usually never coverage under an ordinary health insurance for participation in professional sporting events, combat-focused sports and other very high-risk sporting activities such as paragliding. If you take part in any form of professional competition or what could be considered to be a dangerous sport, you might want to check the exclusions regarding sporting activities. Some insurance companies exclude specific sports; others are broader in their description. If you are at a serious risk of a sports injury, you probably want to get something in writing from the insurance company stating if you’re going to be covered or not. Amateur sports, however, are usually no problem and most companies cover normal amateur sports activities.
Living in China as a foreigner can be challenging. If you ever face an emergency situation where you have to be treated right away in n hospital in China you will face additional challenges. Hospitals in China will not treat you if they do not have any guarantee of payment. A guarantee letter can take some time and even though insurance companies are usually very quick to respond to emergencies, hospitals are still the challenging factors in this equation. Hospitals in China are not allowed to let you die, but that doesn’t mean they will provide the best treatment. If it is not life-threatening they will let you wait until payment has been clarified. Therefore, it is recommended to have an emergency fund in hand (credit card or any Chinese bank account) to be able to put a deposit down, so that you can be treated immediately.
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