Funciones de conversión y tratamiento de fechas y números

The recommendation for a ‘single market’ does not mean that all insurance plans related to health will be required to comply with every feature of the proposed HPS Standard Plan. Insurance plans which are not indemnity hospital plans – such as hospital cash plans, outpatient plans and lump sum critical illness plans, will not be subject to these requirements.

Insurers would also be able to offer IHIPs above the minimum prescribed by regulations. This could be done either as part of the insurer’s HPS Standard plan or as separate ‘Flexi-plans’ which meet all the minimum benefit requirements, but provide an additional range of benefits for consumer choice. Flexi-plan might offer cover for services not otherwise covered in the HPS Standard plan (for example, obstetrics) or may provide a higher level of cover for items included in the minimum benefits. Insurers could also offer Top-up plans, which offer ‘add-on’ benefits to those who already have a HPS Standard plan. Top-up plans would not need to meet the minimum benefit requirements on their own, but would need to be purchased in conjunction with a HPS Standard plan or Flexi-plan to ensure that the policyholder’s benefits meet the minimum benefit requirements.

Table 3 summarises the three different types of plans, along with the key features and minimum requirements with which each of the plans would need to comply.

Table 3: Features and requirements for Standard Plans, Flexi-plans and Top-Ups

Requirements Standard Plan Flexi-Plan Top-up Plan Product offering Must be offered as

basic product choice

Up to insurers to offer

or not

Up to insurers to offer

or not Benefit limits Equivalent to minimum

benefit limits

Above minimum benefit

limits Not regulated

Guaranteed

acceptance Required, with coverageof pre-existing conditions after waiting period

Not required Not required

Guaranteed renewal Yes Yes Not regulated

Premium loadings Premium loading capped

at 200% Not regulated Not regulated

Lifetime limits Not allowed Not allowed Not regulated

Annual limits Allowed Allowed Not regulated

No-gap / known-gap

procedures Must offer on a definedcoverage

Must offer on a defined coverage

Not regulated Deductible and

coinsurance rate Annual cap on deductibleand coinsurance. Prescribed coinsurance rate for certain advanced diagnostic procedures

Annual cap on deductible

and coinsurance. Not regulated

Free Portability Yes; to Standard Plan Yes; to Standard Plan Not regulated Access to High Risk

Pool Yes No No

Executive Summary

Provisions to encourage uptake

Financial Incentives

To encourage uptake, a financial incentive available to all people with a HPS compliant product is proposed.

The incentive is available to all HPS policyholders, in order to encourage greater uptake of HPS products across a broad spectrum of the population. Policyholders with HPS Standard plan, Flexi-

plans, those in the High Risk Pool, as well as employees who take up voluntary supplementary plans, and their dependants, would be eligible. Fine details of implementation should reflect the intention to incentivize take- up of genuine IHIPS and avoid abuse. Three options are considered: A ‘capped’ tax deduction, a capped tax rebate and a direct premium subsidy for all policyholders. Tax deductions are less equitable than tax rebates or direct premium subsidies in the sense that they are worth more to people on higher tax rates. Direct premium subsidies, for the same effective cost to Government, incentivise more people to take-up HPS. However, administrative ease needs to be considered and tax deductions and rebates may be simpler to implement. They can also be available for some non-taxpayers, including retirees, if taxpayers can claim deductions or rebates on behalf of their dependants.

This broad incentive is different to the approach proposed in the Second Stage Consultation, which proposed a premium discount for new joiners under age 30 in the form of a No Claims Discount; and a government incentive to encourage savings by individuals to pay for future premiums. Review of international literature found little evidence to support the effectiveness of these incentives. No claims discounts may produce undesirable health outcomes by deterring policyholders from seeking appropriate health treatment. Medical Savings Accounts are not widespread, and savings incentives are unlikely to grow savings in countries like Hong Kong which already have a strong savings culture and enjoy low tax rates on investment returns.

Regulatory incentives

In deciding whether to take out insurance, consumers are concerned with not only affordability but also

adequacy of protection. The minimum requirements for HPS product design would precisely address this

concern and can be expected to boost consumer confidence. Results of the HPS consumer survey reveal that many consumers respond positively to the regulated features of HPS, such as guaranteed renewal and coverage of chemotherapy and radiotheraphy.

High-Risk Pool

The High-Risk Pool, which caps premiums at three times standard risk for their age group, provides high-risk lives with affordable access to HPS. For the market as a whole, the High-Risk Pool is an important enabler of guaranteed acceptance up to an entry age, which can encourage early uptake of HPS products.

Streamlined Migration

Migration concerns the first year of operation of the HPS, and the way in which people who currently hold health insurance are able to transfer into the new HPS system. Detailed provisions are set out in Chapter 2. They are designed to encourage early uptake of HPS, so that more people can enjoy the benefits and consumer protection offered by HPS, and insurers benefit from more predictable membership. Yet they recognise the risk of adverse selection for insurers, and the need to smooth any transition – particularly increased premiums – for existing policyholders.

Executive Summary

Flexibility for market innovation

The recommendation for a ‘single market’ does not mean that all insurance plans related to health will be required to comply with every feature of the proposed HPS Standard Plan. Insurance plans which are not indemnity hospital plans – such as hospital cash plans, outpatient plans and lump sum critical illness plans, will not be subject to these requirements.

Insurers would also be able to offer IHIPs above the minimum prescribed by regulations. This could be done either as part of the insurer’s HPS Standard plan or as separate ‘Flexi-plans’ which meet all the minimum benefit requirements, but provide an additional range of benefits for consumer choice. Flexi-plan might offer cover for services not otherwise covered in the HPS Standard plan (for example, obstetrics) or may provide a higher level of cover for items included in the minimum benefits. Insurers could also offer Top-up plans, which offer ‘add-on’ benefits to those who already have a HPS Standard plan. Top-up plans would not need to meet the minimum benefit requirements on their own, but would need to be purchased in conjunction with a HPS Standard plan or Flexi-plan to ensure that the policyholder’s benefits meet the minimum benefit requirements.

Table 3 summarises the three different types of plans, along with the key features and minimum requirements with which each of the plans would need to comply.

Table 3: Features and requirements for Standard Plans, Flexi-plans and Top-Ups

Requirements Standard Plan Flexi-Plan Top-up Plan Product offering Must be offered as

basic product choice

Up to insurers to offer

or not

Up to insurers to offer

or not Benefit limits Equivalent to minimum

benefit limits

Above minimum benefit

limits Not regulated

Guaranteed

acceptance Required, with coverageof pre-existing conditions after waiting period

Not required Not required

Guaranteed renewal Yes Yes Not regulated

Premium loadings Premium loading capped

at 200% Not regulated Not regulated

Lifetime limits Not allowed Not allowed Not regulated

Annual limits Allowed Allowed Not regulated

No-gap / known-gap

procedures Must offer on a definedcoverage

Must offer on a defined coverage

Not regulated Deductible and

coinsurance rate Annual cap on deductibleand coinsurance. Prescribed coinsurance rate for certain advanced diagnostic procedures

Annual cap on deductible

and coinsurance. Not regulated

Free Portability Yes; to Standard Plan Yes; to Standard Plan Not regulated Access to High Risk

Pool Yes No No

Executive Summary