How to Improve Health Insurance

Ho Chi Minh City had only 8,000 people with private health insurance policies, but the number soared to 138,000 last year, including a whopping increase of 5000 new student policy holders. Under the current system, the state will have to share in the payment to to claims by policyholders, and as a result, the increase in the number of private insurance members will lead to a drain in the state budget. Yet, a projection of a universal public health insurance by 2010 is to be achieved, or is it an unrealistic target ?

Private Health Insurance: cheaper but same benefits

Bui Duc Trang, deputy director of the Ho Chi Minh City Social Insurance Agency, says more people have elected to pay private insurance for different reasons. For instance, policyholders can enjoy various benefits, more people have gotten ill, including serious diseases while health care is costlier and is even unaffordable in many cases if the patients are not insured

Treatments for some serious diseases may be unaffordable when the patients do not hold a health insurance policy (Photo: Tuong Thuy)

Premiums of private health insurance have increased since January 1, 2006. Asked by the Sai Gon Giai Phong whether the rise will adversely affect low-income earners and the poor, Mr. Trang says the new premiums have been calculated so as to keep up with the national economic development and the improved treatment quality, not to ensure profits for Insurance Companies. Last year, the total balance sheets of the Insurance companies reveal a VND20 billion deficit in the area of private insurance.

At present, the premiums are lower than half of those of compulsory health insurance but the benefits for the two groups of policyholders are the same. He says the increase is not big, and the new premiums of VND80,000 and VND120,000 per year for the suburbs and inner-city areas, respectively are quite affordable. Mr. Trang adds that studies have shown the public are paying more attention to the quality of health insurance and customer service provided to them than to the premiums they pay. Unfortunately, there is still a lot to be desired in both areas. 

Suggested management for health insurance fund

The health insurance fund comprises the insured’s money and State funding. The insurance agency keeps the first part, and the other part is allocated to hospitals and doctors, but this State investment is reportedly not effective. There are proposals that the Government should designate the insurance agency to manage this State investment. With this funding, the agency will cover all health care costs, leaving hospitals and doctors to provide patients with the best health care services possible.

The Government is paying VND150,000 per year for each inhabitant to get health care from hospitals and clinics. Mr. Trang suggests that this sum makes up half of the health insurance card’s value and each person should spend another VND150,000 to secure the insurance card worth VND300,000, valid in one year.

“Those who do not take up private insurance will miss out on get this Government funding" says Mr. Trang. He hopes his message will encourage more people to take part in private health insurance.

By Kieu Oanh – Translated by Tuong Thuy

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