Many expats with Social Security health coverage often ask if they need supplementary insurance. The answer is not as easy as “yes” or “no” since it depends a lot on each person’s situation.
In this article, you will find some information that will clarify this question. From a full explanation of what is supplementary medical insurance to some tips to help you choose yours. As well as the most common alternatives.
Social Security for Expats and Supplementary Medical Insurance
Before talking further about supplementary health insurance, it is important to understand how Social Security works.
A Public Service
Social Security is a public service available in many countries in the world. It’s a public entity managed by the Ministries of Work and Health.
Its mission is to ensure that all residents have proper insurance.
Health Insurance Open to All, but Optional
Some countries even cover their nationals when they go expatriated to other territories. In this case, those who go abroad can keep affiliated with Social Security.
However, this membership is never mandatory. And it does not exempt you from affiliating with any mandatory health plan in your country of residence.
3 Types of Insurance
There are 3 types of insurance included in Social Security coverage. Health insurance, retirement insurance, and professional risk insurance. We are interested in the first because it is the one that can be covered by supplementary insurance.
In terms of reimbursement, they are calculated following the cost of the assistance in the expat’s home country. If this amount is not enough, the insured needs to pay the rest from his/her pocket.
What Is Supplementary Medical Insurance and Why Should You Get It?
Social Security has many limitations and most of the time is not enough to be well covered abroad.
Social Security Offers Low Reimbursements
In countries where health care is expensive or where only private establishments provide an acceptable quality of care, the cost of assistance might be higher than in your home country.
This means that Social Security won’t pay all the bills, and you will have to cover the difference.
And sometimes, these amounts can be considerably high. For example, if you are expatriated in the USA or Switzerland.
To solve this issue, it is strongly recommended to subscribe to supplementary medical insurance with an international company.
Lack of Partnerships With Local Health Networks
The other major issue concerning Social Security health insurance is that most of the time you will have to pay in advance all of the costs.
In some cases, like a hospitalization, they can represent huge sums of money.
Very few countries in the world have established arrangements between their Social Security and local medical networks.
Is Supplementary Insurance the Best Solution?
These programs will allow you to benefit from better reimbursements and more extensive coverage. As well as third-party payment in case of hospitalization.
Limits of a Supplementary Medical Insurance Program
Indeed, supplementary health insurance plans are not free from certain limits. While improving the reimbursements, they are generally as rigid as Social Security.
You might need to send original invoices to Social Security. And sometimes, public services like this have outdated procedures, that delay all the process. Also, in the event of a dispute, their response can be too slow.
As mentioned above, subscribing to Social Security is not mandatory for expats most of the time. You can opt to insure yourself directly with a private company getting a type of policy called “from the first euro/dollar”.
How Much Do Supplementary Health Insurance Plans Cost?
These insurances often work in stages, like a Lego set:
- Minimum coverage: for hospitalization longer than 24 hours, you will not have to pay anything. The insurance will pay hospitals and doctors directly.
- Hospitalization + routine care: they add medical visits, analysis, medication, X-rays, physiotherapy, etc
- Optical/dental services.
Maternity is included from the 2nd or 3rd level depending on the company.
The rates depend on your age and your country of residence. In the case of family insurance, it will be necessary to add the individual rates of each member.
Here are some examples:
For a single person who is 34 years old and lives in a geographical area where the cost of health care is considered intermediate (Australia, Mexico, Spain, Indonesia):
- Between 120 and 200 euros per quarter for a level 1 coverage
- Between 300 and 400 euros per quarter if you add the 2nd level of care
- Between 400 and 550 euros for the complete solution.
Around the age of 50, you will need to add 50% more. This would be between 200 and 350 euros per quarter for level 1. Between 500 and 700 euros for level 2. And around 800 euros per quarter for the complete solution.
For a family with parents between 30 and 40 years old, and two young children, it will be necessary to count on 500 euros per quarter for the first level. Around 1300 per quarter by adding routine care. And 1500 for the full coverage.
The rates of your supplementary medical insurance program are to be added to those of Social Security.
If you live in a less expensive area, they can be reduced by up to 40% (Thailand, Panama…). If the care in the geographical area is more expensive, the prices can increase (Japan, Switzerland, USA).
It is important to compare your Social Security + supplement solution with a policy “from the first euro/dollar”.
Analyze all the advantages and disadvantages and decide with one is better. Some factors to take in mind are rates, waiting times, ease of reimbursement, agility in the management, and flexibility.
“First Euro” Policies, an Alternative to Supplementary Medical Insurance
Contrary to the previous ones, first euro insurance is independent of Social Security. Indeed, they cover health expenses from the first euro or dollar spent.
Compared to Social Security supplementary insurance, the “first euro” policies are easier to manage.
Part of this is because the insured has only one entity to contact. They are also faster and you will not suffer from any of the administrative complications that come with Social Security.
Besides that, this type of insurance is much more flexible. They can be adapted to the particular situation of each person and the country of residence.
The companies that market them generally have specific agreements with local health networks.
Finally, they can include special coverages, such as repatriation, if necessary.
The key is to compare the two solutions with an agent if possible specialized in expat insurance.
This way you will be able to check which one suits you better. Depending on your country of residence and your family configuration, the differences in rates can be significant.
Social Security Coverage and Reimbursements
Social Security + Supplementary Insurance
As we have seen, Social Security provides coverage at the same rates as your home country. They are often much lower than local rates.
Their coverage with supplementary medical insurance is generally divided into three blocks that work like floors. You cannot have the third block without having the two previous ones:
Minimum Coverage: Hospitalization Longer Than 24 Hours
Any hospitalization of more than 24 hours will be covered at 100% of the real costs. In other words at 100% of the local rates and no longer according to those of your home country.
Your insurance will pay the hospital and the doctors directly. And it will make arrangements with Social Security later. You will not have to pay anything.
This is a very affordable solution in terms of rates. It will take care of the most expensive items. And your routine care (medical visits, medication, x-rays, etc) will be reimbursed by Social Security according to your home country rates.
Supplementary Health Insurance With Added Coverage for Routine Care
In addition to 100% coverage of hospitalization costs, you can extend the coverage to all your routine care.
Regardless of your country of residence. Some contracts will even include alternative therapies such as homeopathy, acupuncture, chiropractic, etc.
You will be able to choose between several levels of coverage. And varying ceilings for medical visits, medications, or physiotherapy sessions.
This is already a relatively comfortable coverage. It will be necessary to be vigilant on the ceilings per service and also on the yearly ones.
This is a key item that should not be neglected. The amounts allocated to maternity vary enormously depending on the company and the policy.
It should include all the care from pre-delivery sessions, visits to the gynecologist, and ultrasounds until the day of delivery.
It is very important to make sure that the amount is enough in case of complications for the mother as well as for the newborn. Ask to see this clause. Indeed, complications can lead to an explosion of costs.
The amounts for maternity range from 3500 euros to 15000 euros depending on the company. Concerning complications, the maternity coverage is sometimes doubled. In the most efficient ones, the coverage goes up to 100%.
Caution: For all supplementary insurances, there is always a waiting period of 10 months before becoming pregnant to benefit from this coverage.
Dental and Optical Services
You will be able to ask for the reimbursement of your day-to-day dental care. But also of your dental prosthesis, implants, and even orthodontics for children under 16 years old.
This coverage is often very useful for families with young children. As orthodontic treatments are costly and time-consuming.
Coverage with the “First Euro” Policies
With a first euro solution, you will gain a lot in agility, response time, and flexibility. But what about the guarantees?
The guarantees will be the same as those offered by the supplementary health insurance companies. The reason is simple: both products are offered by the same insurers.
There are no differences in terms of coverage. But, there are some in terms of rates and management of pre-existing medical conditions. Many parameters need to be observed to make a wise choice.
It is a public entity that depends on the Government. It’s available in many countries all over the world. Its mission is to ensure that its citizens have proper insurance.
In some countries, it is compulsory for the ones residing in it. But never for the nationals that moved to another territory.
Social Security refunds expatriates according to the rates in their home countries. And they are often insufficient abroad. Insurance companies market supplementary health insurance to make up for this shortfall.
It offers 3 types of insurance:
– Health insurance
– Retirement insurance
– Professional risk insurance