Health Ins Mkt
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Transcript of Health Ins Mkt
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Healthcare Insurance MarketHealthcare Insurance Market
ChapterChapter -- 11
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Definitions of Health insuranceDefinitions of Health insurance
Insurance providing for the payment ofInsurance providing for the payment ofbenefits as a result of sickness or injury.benefits as a result of sickness or injury.
Includes various types of insurance, suchIncludes various types of insurance, suchas accident insurance, disability incomeas accident insurance, disability incomereplacement insurance, medical expensereplacement insurance, medical expense
insurance, and accidental death andinsurance, and accidental death anddismemberment ( Removal of limbs bydismemberment ( Removal of limbs bycuttings) insurance .cuttings) insurance .
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Definitions of Health insuranceDefinitions of Health insurance
Health insurance like other forms ofHealth insurance like other forms of
insurance is a form of collectivism byinsurance is a form of collectivism by
means of which people collectively poolmeans of which people collectively pool
their risk, in this case the risk of incurringtheir risk, in this case the risk of incurringmedical expenses.medical expenses.
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Healthcare InsuranceHealthcare Insurance
The main drivers in the healthcare marketThe main drivers in the healthcare marketis the ageing population.is the ageing population.
There is no Universal Health CareThere is no Universal Health Careinsurance system adopted among theinsurance system adopted among thecountries.countries.
Different Countries have tried differentDifferent Countries have tried differentmodels according to their knowledge .models according to their knowledge .
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Health Insurance Policies
Health Insurance Policies
Long-term policies- generallyprovided by
life assurance companies Income protection insurance Critical illness insurance Long-term care insurance
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Health Insurance Policies
Health Insurance PoliciesShort-term policies - General insurance
companies
Accident, sickness and unemploymentinsurance
Private medical insurance Hospital cash plans
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Healthcare Insurance MarketHealthcare Insurance Market
National Health Service (NHS)National Health Service (NHS)--19481948
UK state system of healthcare.UK state system of healthcare.
Higher proportion of healthcare than otherHigher proportion of healthcare than othereconomically advanced countries.economically advanced countries.
For Healthcare Poor people depends onFor Healthcare Poor people depends on
Charities, Religious organizations, self helpCharities, Religious organizations, self helpor traditional health system.or traditional health system.
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Healthcare Insurance MarketHealthcare Insurance Market
National Health Service (NHS)National Health Service (NHS)--19481948
Trade Unions, Friendly Societies, SelfTrade Unions, Friendly Societies, Self--helphelpgroups provided Insurance againstgroups provided Insurance againstmedical risk.medical risk.
National Insurance ActNational Insurance Act--19111911
Provide national insurance against rangeProvide national insurance against rangeof risk of working people (Poor, Low paidof risk of working people (Poor, Low paidworkers).workers).
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Healthcare Insurance MarketHealthcare Insurance Market
NHS Act 1946, Came into effect in 1948.NHS Act 1946, Came into effect in 1948.CONCEPT OFNHSCONCEPT OFNHS
Hospitals were purchased by state.Hospitals were purchased by state. NHS employed hospital doctors, canNHS employed hospital doctors, can
practice privately.practice privately.
(GPs) General practioners contract(GPs) General practioners contractwith NHSwith NHS -- paid per patient.paid per patient.
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Healthcare Insurance MarketHealthcare Insurance Market
Free health treatment.Free health treatment. Services funded through general taxation.Services funded through general taxation.
NHS TodayNHS Today
Estimated cost 67 billion pound with 1.3 millionEstimated cost 67 billion pound with 1.3 millionEmployee.Employee.
Free access to Hospitals, GPS, and ClinicFree access to Hospitals, GPS, and Clinictreatment.treatment. Locally Managed primary care trust GPs.Locally Managed primary care trust GPs.
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Healthcare Insurance MarketHealthcare Insurance Market
Health And Ambulance Trusts.Health And Ambulance Trusts. Privately run Treatment centre work WithPrivately run Treatment centre work With
NHS at fixed price in order to ease theNHS at fixed price in order to ease the
burden of NHS.burden of NHS.
Private & overseas hospitalsPrivate & overseas hospitals -- helpful forhelpful for
patients who cant get treatment with in thepatients who cant get treatment with in thetime scale.time scale.
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Healthcare Insurance MarketHealthcare Insurance Market
Difference Between Private & Public sectorDifference Between Private & Public sector
Differences exist due to type of treatmentDifferences exist due to type of treatment
like emergency, Alternative medicines,like emergency, Alternative medicines,
Cosmetic Surgery.Cosmetic Surgery.
Private SectorPrivate Sector -- Treatment throughTreatment through
Technique & Technology,Technique & Technology,
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Healthcare Insurance MarketHealthcare Insurance Market
Certain Private HospitalsCertain Private Hospitals May not haveMay not haveIntensive care back up technology.Intensive care back up technology.
Choice of facilities,Choice of facilities, Private sectorPrivate sector--Complete choice ofComplete choice of
specialist,specialist,
Time spentTime spent--waiting to be treated (Waitingwaiting to be treated (WaitingList.),List.),
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Healthcare Insurance MarketHealthcare Insurance Market
Participants of Health Care InsuranceParticipants of Health Care Insurance
Market:Market:
Private Health Sector,Private Health Sector, Provident Insurers,Provident Insurers,
Commercial insurers,Commercial insurers,
Health and Dental Cash Plans,Health and Dental Cash Plans,
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Healthcare Insurance MarketHealthcare Insurance Market
Third Party Administrators and otherThird Party Administrators and otherProviders.Providers.
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Healthcare Insurance MarketHealthcare Insurance Market
Private Health SectorPrivate Health Sector--People (Cant waitPeople (Cant wait
NHS Facility) / willing to pay directly orNHS Facility) / willing to pay directly or
through Insurance.through Insurance.
Highly Specialized marketHighly Specialized market
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Healthcare Insurance MarketHealthcare Insurance Market
Advan. of Private Medical TreatmentAdvan. of Private Medical Treatment
Less time waitingLess time waiting Non urgent operationsNon urgent operationsLike hernia.Like hernia.
Choice of ConsultantChoice of Consultant operations oroperations orTreatment,Treatment,
Choice of admission dates / hospitals.Choice of admission dates / hospitals. Private Room Facility.Private Room Facility.
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Healthcare Insurance MarketHealthcare Insurance Market
Private Med. Ins. Policies dont coverPrivate Med. Ins. Policies dont cover::
Chronic (Long lasting) IllnessChronic (Long lasting) Illness-- asthma /asthma /Diabetes,Diabetes,
Normal pregnancy, Childbirth, Long termNormal pregnancy, Childbirth, Long termDisability or long term psychiatric illness,Disability or long term psychiatric illness,
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Healthcare Insurance MarketHealthcare Insurance Market
Cosmetic surgery / Therapies ( SomeCosmetic surgery / Therapies ( SomePolicies may offer).Policies may offer).
Provident InsurersProvident Insurers (FSMA(FSMA--2000) are :2000) are :
Non profit org. for the provision of MedicalNon profit org. for the provision of MedicalTreatment with No shareholders,Treatment with No shareholders,
Operating surpluses are part of theirOperating surpluses are part of theirreserves & so no corporation tax.reserves & so no corporation tax.
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Healthcare Insurance MarketHealthcare Insurance Market
No tax relief on Losses.No tax relief on Losses.Commercial insurers areCommercial insurers are ::
Operating in healthcare insurance market,Operating in healthcare insurance market, Profit making org. with shareholders,Profit making org. with shareholders, Pay dividends out of their taxed profit.Pay dividends out of their taxed profit.
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Healthcare Insurance MarketHealthcare Insurance Market
Health & Dental Cash Plans:Health & Dental Cash Plans:
Regional funds for working people,Regional funds for working people, Mutual org. run for the benefits of theirMutual org. run for the benefits of their
members,members,
Most of the healthcare problems areMost of the healthcare problems arerelatedrelated to Dental & optics.to Dental & optics.
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Healthcare Insurance MarketHealthcare Insurance Market
Third party Administrators & OtherThird party Administrators & Other
Providers:Providers:
Specialist health care Consultants,Specialist health care Consultants, Provide advice to corporate clients onProvide advice to corporate clients on
selecting Insurers and Cost containmentselecting Insurers and Cost containmentservices,services,
Employers run for their Employees,Employers run for their Employees,
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Healthcare Insurance MarketHealthcare Insurance Market
Provide a Full Claim administration services,Provide a Full Claim administration services, Paying claim on the behalf of employers.Paying claim on the behalf of employers.
Strengths of TPAs and Consultancies :Strengths of TPAs and Consultancies : IndependenceIndependence -- Like Brokers but not all,Like Brokers but not all, MotivationMotivation Rewarded for Cost Controlling,Rewarded for Cost Controlling,
FlexibilityFlexibility Tailored solution according to ClientTailored solution according to ClientRequirementsRequirements
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Healthcare Insurance MarketHealthcare Insurance Market
InformationInformation Retain all data of clientRetain all data of clientHealthcare insurance including ClaimsHealthcare insurance including Claims
details.details.
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Healthcare Trust & Self InsuranceHealthcare Trust & Self Insurance
Health TrustHealth Trust
Set up by Large org. due to Cost andSet up by Large org. due to Cost and
Administration.Administration.
Features of a Health TrustFeatures of a Health Trust
Not like an Insurance policy,Not like an Insurance policy, No tax applicable on the fund like IPT,No tax applicable on the fund like IPT, Trust Administered by Trustee or a TrustTrust Administered by Trustee or a Trust
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Healthcare TrustHealthcare Trust
Company,Company,
Health Trust is Funded by Employer,Health Trust is Funded by Employer, Trustees determines the EmployeesTrustees determines the Employees
Benefits,Benefits,
Limited Membership of the Trust,Limited Membership of the Trust,
Legal advice is necessary to setup a TrustLegal advice is necessary to setup a Trustbecause of the Complexity in Trust Law,because of the Complexity in Trust Law,
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Healthcare TrustHealthcare Trust
Employees receive benefits according toEmployees receive benefits according toTrust Rules,Trust Rules,
Employers Labiality may be limited byEmployers Labiality may be limited byarranging Stop Loss Insurance.arranging Stop Loss Insurance.
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Self InsuranceSelf Insurance
Self InsuranceSelf Insurance
Payment of Healthcare treatment costPayment of Healthcare treatment cost
without Insurance by Employer orwithout Insurance by Employer or
Individuals.Individuals.
Why Self Insurance?Why Self Insurance?
Underestimation of Healthcare treatmentUnderestimation of Healthcare treatmentcost ,cost ,
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Self InsuranceSelf Insurance
Low cost event may add number ofLow cost event may add number oftreatment & so increase the amounttreatment & so increase the amount
required for treatment,required for treatment,
Future treatments increase the Cost.Future treatments increase the Cost.
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TaxationTaxation
Tax is not usually applied to the person whoTax is not usually applied to the person who
received the benefits of medical treatment.received the benefits of medical treatment.
Value Added Tax (VAT) is not applied toValue Added Tax (VAT) is not applied to
Premium.Premium.
Insurance Premium tax (IPT) is applied onInsurance Premium tax (IPT) is applied on
Premium.Premium.
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Distribution ChannelsDistribution Channels
Categories of Medical Insurance MarketCategories of Medical Insurance Market
Individual paid,Individual paid, Company paid and,Company paid and,Voluntary employee paid groupsVoluntary employee paid groups
(Employees pay their premium).(Employees pay their premium).
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Distribution ChannelsDistribution Channels
Two Main Dist. Methods for HealthcareTwo Main Dist. Methods for Healthcare
InsuranceInsurance
Direct sales (Including Telesales),Direct sales (Including Telesales),
Independent Intermediaries.Independent Intermediaries.
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Distribution ChannelsDistribution Channels
Direct salesDirect sales
Mobile Sales ConsultantsMobile Sales Consultants -- Deals LargeDeals Large
Employers,Employers, Send mail to potential customers aboutSend mail to potential customers about
the product (Forms, Phone or Internet),the product (Forms, Phone or Internet),
Advertisement on Print & Electronic MediaAdvertisement on Print & Electronic Media WebsitesWebsites--Provide information about healthProvide information about healthproduct,product,
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Distribution ChannelsDistribution Channels
Call CentresCall Centres -- Contact to potentialContact to potentialCustomers.Customers.
Advantages of Direct Sales:Advantages of Direct Sales:
ControlControl over Sales process with customers,over Sales process with customers,
DifferentiationDifferentiation Better service,Better service,
FeedbackFeedback from customers about Productfrom customers about Product
& Services.& Services.
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Distribution ChannelsDistribution Channels
Disadvantages of Direct Sales :Disadvantages of Direct Sales :
Customers Limited InformationCustomers Limited Information ProductsProducts
available in the Health Insurance Market,available in the Health Insurance Market,
Loss of GoodwillLoss of Goodwill -- Commission base selling.Commission base selling.
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Distribution ChannelsDistribution Channels
Independent intermediariesIndependent intermediaries
A ready made, experienced, and trustedA ready made, experienced, and trusted
channel of distribution for the Healthcarechannel of distribution for the Healthcare
Products to a large number of Individuals.Products to a large number of Individuals.
Cost effective for the Insurer due toCost effective for the Insurer due to
Advertisement expenses, Services & SalesAdvertisement expenses, Services & Sales
infrastructure.infrastructure.