Voluntary Health Insurance is coming to Hong Kong: What you need to know

Voluntary Health Insurance is coming to Hong Kong: What you need to know

In 2018, the Hong Kong government announced details of the Voluntary Health Insurance Scheme (VHIS) in an ongoing effort to alleviate the pressure on the public healthcare system and provide more opportunities for people to choose private healthcare services.

The scheme will go into effect on April 1st, 2019 leaving many parties working hard to prepare for this significant change. There are several considerations that need to be made by insurers, employers, and individuals before the roll-out.

While the government has come out with Minimum Requirements and a framework for the VHIS, a recent survey conducted by MMB found that only 64% of insurers are currently developing VHIS-certified products. It appears that many are taking a ‘wait-and-see’ approach, likely due to the significant changes that need to be made to an insurer’s operations and procedures when selling certified plans. But, overall, the majority of insurers feel that the introduction to VHIS would encourage individuals to purchase Individual Health Insurance (IHI). We believe that the success of VHIS hinges on a shift by the Hong Kong healthcare system from curative care to preventative care and wellness.

This shift has significant benefits to both employers and employees. VHIS will restore consumers’ confidence in their medical insurance coverage as well as help minimize unnecessary claim disputes that may arise due to misinterpretation of terms and conditions.

Employers should consider shifting portions of their budget to provide wellness and preventative measures, such as gym membership reimbursement, in addition to offering benefits up to the minimum levels suggested by the government. These benefits can provide a competitive edge in a world where there is an ongoing war for talent and retention.

As a market leader in employee benefits, we believe the launch of VHIS will create a much-needed industry standard. Employers must provide sufficient communications and education to employees to ensure they understand both the benefits and implications. We expect to see a significant uptick in Human Resources and Employee Benefits specialists and consultants in need of support on how to implement VHIS-related initiatives.

A more detailed study on VHIS in Hong Kong will be released by Mercer Marsh Benefits Hong Kong soon. If you’d like to receive the report when it is released, email MMB HK Enquiries to be added to the distribution list. While we expect the scheme to be launched on April 1st, 2019, don’t be caught off-guard and schedule a time to speak with us today.

Brian Ching
by Brian Ching

Senior Benefits Analyst, Business Insights and Analytics, Mercer Marsh Benefits

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