Why Do My Health Insurance Premiums Keep Going up Each Year – Part 1
This is a question we get all the time. There are many reasons for this and many angles to explore so we’ve broken this post down into 2 parts (see Why Do My Health Insurance Premiums Keep Going up Each Year – Part 2).
If you see your premiums increasing this year, you’re not alone. According to SIA Partners, Hong Kong is the 2nd most expensive location in the world for healthcare and private insurance (Health Insurance premiums in Hong Kong increased by 9% in 2017). While this can be frustrating, there are a few reasons for this.
Doctors are highly educated, highly sought after, and highly paid professionals. They charge a lot of money for their services. And as medical technology gets more advanced, it also gets more expensive. Naturally, as costs of treatments get higher and higher, your insurance premiums must rise to keep pace.
Private Healthcare Fees
While the Hong Kong government puts limits on fees public hospitals are allowed to charge, there is no limit on how much private healthcare providers can charge.
There are also demographic pressures from Hong Kong’s ageing population. The public healthcare sector treats 90% of Hong Kong’s patients but only employs 40% of doctors. Many people are turning to private healthcare to avoid the clogged public system driving up demand and costs.
All of this leads to higher costs for the insurers and therefore higher costs for insureds as well.
Greed & Big Business in Healthcare
When you’re sick, the only thing on your mind is getting better and you are not likely to shop around for the best prices on treatments. This means healthcare businesses have a unique advantage over you and opportunistic businesses are able to charge much higher prices than normal.
A free market is generally a good thing – it leads to innovation, better service and innovation as companies compete with each other to attract consumers. In healthcare though, the results have been mixed as public healthcare is clearly cheaper than private.
If you’re concerned about your health insurance premiums, get in touch with a Trusted Union insurance advisor. We can help you review your insurance and take steps to keep your premium increases under control. You can read full series Part 2 & Part 3 for more information.