The primary purpose of any insurance cover is to protect purchasers of such policies against probable but unanticipated adverse perils.
A potential buyer of any insurance policy must of necessity evaluate his potential adverse perils and then appraise the insurance product being presented to him for purchase. Taking motor insurance as an example, a person who wants to ensure a full replacement of his vehicle in the unanticipated event of an accident, will normally purchase a comprehensive car insurance with a total policy cover of equivalent value, to the value of his prized asset.
Purchasing Private Health Insurance
Similarly, private health insurance is fashioned on the same premise of “restoring a person back to full health after falling ill”. The challenge with health as opposed to other tangible assets is that, full restoration to a state of good health may never be achieved after the event. Health insurance only makes provision for the costs that one may incur in an attempt to seek medical treatment for a named medical condition. It is designed to meet the health expenditure needs of individuals, families and businesses. Potential buyers of such plans must of necessity evaluate the product offerings before purchase.
These product offerings are furnished to buyers as benefits packages. Due to the variability in health-related needs from person to person or business to business, there is the need for both customers and potential customers of health insurance products, to fully acquaint themselves with the cover being purchased by reviewing and ensuring that the benefits package being opted for, meet the anticipated health needs. In general benefits are presented in categorized sets, those that cover out-patients care and in-patients cover benefits. These together will constitute the entire spectrum of care one is entitled to access.
Private health insurance – Packages
In designing benefit packages, the cost of care is a primary axis along which benefits are distributed against. Mostly commonly, there are three benefits packages – Comprehensive benefits, Mid-range benefits and Budget or Basic benefit packages. Each is designed to meet a specific health need.
Comprehensive packages as the name connotes are referred to as “full cost” or “full refund” policies. They are designed to give enrollees a cover wide enough to offer protection against most of the predictable health needs for a person of a stated age and a defined baseline health. The concept of defined baseline health is critical because at every level of health, the definition of comprehensive could vary. A comprehensive benefits package designed for a 27-year old average healthy male, may not be comprehensive enough for a 56-year old man with known chronic kidney failure whose real needs-based definition of “comprehensive cover” might require the inclusion of a benefit for a kidney transplant, which may be an excluded service for a healthy person.
Comprehensive packages usually come with value-added services like flexibility in choice of hospital accommodation, and diagnostic and radiologic tests with little or no limits regarding frequency and types of tests that can be undertaken. Provision is also made for annual medical and dental examinations and sometimes for home-administered care. Rehabilitation and its attendant costs including chiropractor services are also usually covered under such plans and in most cases, treatment for mental and addictive illness, alternative medicines and therapies are covered as well. In jurisdictions where the system allows for varied product innovations, cash benefits may be given for in-patient services accessed under specific terms and conditions. Comprehensive packages have minimal excluded services and always comes at high premium. They tend to be the most expensive health insurance covers that can be taken. Over the years, medical inflation and high claims associated with such policies have led to a reduction in such benefit package market offerings. The focus has been on reducing premiums and claims cost even if that means having less cover.
Mid-range packages provide cover for most of the anticipated everyday healthcare needs similar to that of the comprehensive packages. However, mid-range packages come with reduced or capped benefits and a number of excluded services at significantly reduced premiums. Both OPD and IPD services are capped at reasonable limits and they may have other restrictions like provision of care only from an approved list of service providers. The excluded list of services may vary from total or partial exclusions. This may include pregnancy and its related costs, partial refund for services pre-paid for by the enrollee and no access to branded pharmaceutical products. A cursory review of the policies on offer among most private insurance providers in Ghana show that a majority of benefits packages on offers are modified mid-range packages. The premiums for such packages are generally within marketable levels to a wider group of the populace.
The basic or budget policies are designed to provide health insurance cover at a low premium. There is a little room for insurance companies to play with services to be covered under such plans as the premiums are only enough for the provision of basic health care. The key differentiator is the severe limitations with what enrollees can access. Some budget plans may come with long waiting periods or co-insurance options as an attempt to keep claims costs within manageable levels. The National Health Insurance Scheme was fashioned on the premise of a basic benefits package.
Private Health Insurance – Flexible policies
At all times it must be kept in perspective that when it comes to healthcare, needs can change with time. A policy that may appear to provide you with a good cover today may have to be reviewed either upwards or downwards at the next policy renewal date. Buyers of health insurance products have to be flexible and willing to re-evaluate their own health needs or that of the people the plans are being purchased for in relation to the benefits package on offer, to ensure that adequate cover is purchased at all times. This should always be done with a premium cost in mind. Each added service may come with an increase in premiums. Notwithstanding the above, it is also important to state that the uncertainties with health needs for each person, family or business makes its very challenging for any one benefit package to have a coverage expansive enough to meet every health need that may arise in the future.
A potential buyer has to walk a fine line balancing the premium expenses that will come with going for a comprehensive health insurance package with that associated with purchasing a package with significant cover but at an affordable premium. Discussing your health needs and the realistic associated costs with your insurance provider, can ensure that one is well informed before signing up to any health insurance policy.
Author: Dan V. Armooh, Dr.
The writer is the CEO of Acacia Health Insurance Ltd
