- Svetlana, what is the difference between health insurance programs and medical insurance? Aren’t they synonymous?
- No, it is two different ways of insurance protection. Their operating principles are different.
Medical insurance or VHI programs allow an employer to arrange and pay for the treatment of its employees at the expense of the insurance company. Medical aid is provided in clinics pre-determined under an insurance contract. Most often this is a common disease treatment, for example, seasonal acute respiratory viral infections, exacerbation of some kind of chronic disease, when a consult of a specialized physician and drug prescription is needed. According to various estimates, this is more than 2/3 of all requests on VHI programs. Our staff also has health insurance, and we stay within the general statistics. However, there are acute health problems, when you need to call an ambulance, for example, in case of heart attack.
A critical illness insurance program has another principle. If the insured employee faces a complex disease – oncological diagnosis, stroke, or, for example, need for organ transplantation, the insurance company will pay financial aid to his personal account. This amount is pre-determined and can be selected at the time of the insurance contract conclusion. The whole treatment organization: the choice of hospital, attending physician, or method of treatment, remains at the client’s discretion. For example, a client may choose a clinic abroad. In my opinion, this format of assistance today is more relevant.
- Is the main difference in the way of provision of assistance?
- In fact, there are differences in the method of providing medical services to the client, as well as in the restrictions on the insurance program. Under the VHI programs, all payments are made only to the clinic's account, treatment can be received in certain medical institutions, only those medical services and medications specified in the contract are paid. There are no such restrictions under the illness insurance program: money can be spent not only on medical services and medicines, but also expenses associated with treatment, and, of course, to compensate for the employee's income lost during the illness.
There is another very important point: life-threatening and requiring long-term treatment complex diseases are often an exception to the VHI program, that is, their treatment is simply not provided by the usual medical insurance. In some cases, only the first course of treatment can be covered, but not repeated, and certainly not rehabilitation. That is why the best option is a combination of two insurance programs: the usual voluntary medical insurance policy and financial protection in case of illness.
- Complex disorders are not as common. How relevant is protection against critical diseases in general, especially for young, able-bodied people?
- This is a common misconception why many young Ukrainians are left without insurance and cannot pay for the necessary treatment. Analyzing the WHO medical statistics and general Ukrainian data, unfortunately, it becomes obvious: the frequency of critical diseases is increasing, plus serious illnesses are “getting younger”. For example, in 2014, 94 thousand patients with the first cerebral stroke were officially registered in Ukraine, and in 2018 there already were 111 thousand patients, while 33-36% of them were of working age. These figures are 2.5 times higher than those of Western Europe, and unfortunately, they are growing. The data on oncological cases is even more depressing. On average, 65-70% of deaths of people of working age in Ukraine occur due to chronic non-infectious diseases: circulatory system diseases play a leading role in men, and oncology in women.
- Which of the companies in Ukraine provides employee health insurance? How many insurance companies have license?
- There are about 10-15 companies today. The critical illness insurance is offered both by providers of VHI and life insurance companies. The second option is more common, since life insurers can usually offer more attractive insurance conditions and large amounts of insurance protection.
For example, MetLife Company cooperates with many corporate clients who enter into contracts in favor of their employees with coverage of 300 thousand - 1 million UAH. That is exactly what the client will receive when confronted with a threatening diagnosis. The standard amount under the VHI program, even if it includes treatment in case of oncological diagnosis, is usually UAH 150-250 thousand, and the company covers only the first course of such treatment. That is why the VHI package and critical illness program constitute the optimal tandem of insurance protection. They complete, but do not replace each other.
- Is it expensive for companies to insure personnel against critical diseases?
- A distinctive feature of such insurance programs is their relative affordability. The final rate depends on several factors: the number of insured, selected amount of insurance protection, average age of employees, gender ratio in the staff. For example, the probability of cardiovascular diseases in men becomes much higher with age, and this also affects pricing.
But in any case, critical illness insurance, even with maximum coverage amount of half a million-million UAH, usually costs the employer 1.5-2 times cheaper than the low-budget medical insurance program. This means the price at the level of 2000-3800 thousand UAH for one insured per year. Programs with less coverage are even more affordable, there are proposals with a budget of up to 1,000 – 1,500 UAH a year.
- What do these critical illness insurance programs give to companies and their employees? Could you share payoff statistics?
- Of course, the total amount of payments to employees of our corporate clients faced with critical diseases in 2018 exceeded 3 million 700 thousand UAH. The insured people with disability status set after a cancer treatment, stroke, or heart attack received another 4 million 300 thousand UAH; this option can also be included in the corporate insurance package. We have already paid more than 3.1 million UAH for insurance against critical diseases for 5 months of this year. As you can see, the figure is approaching the annual figures of 2018.
Unfortunately, no one can guarantee 100% protection against diseases. A socially responsible employer and reliable insurance partner can, at least, give a person confidence that a complex disorder will not become a financial catastrophe for him, and that he will not be left alone with it. As the experience of our insured people shows, this kind of both financial and psychological support helps get access to modern treatment, maintain a positive attitude and seriously increase the chances of recovery. Fortunately, our customers already have examples of such victories and a return to a healthy life. And this is one of the most important reasons, why I really want the critical illness insurance to become a standard practice available to most people in Ukraine as soon as possible. It would be great if responsible employers realize that and help us in this.
Photos are from open sources.