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When Cheap Medical Insurance Is Too Costly

04 January 2022

Since the beginning of the Covid pandemic many expats have focused more time and energy on the issue of medical insurance as the 'purse strings' tighten. It's no wonder why expats look to cut healthcare insurance premium costs when incomes become stretched. The recent case reported of Jill Dodds serves to illustrate the issues raised and the consequences of making poor decisions.

Expats and international travellers having carried out some research will have found that the premium costs of medical insurance do not always come cheap, particularly if comprehensive protection is required.

There is an old adage that says 'you only get what you pay for', which in the case of expat medical and international travel medical insurance is most definitely the case.

One only has to look at some of the better known medical insurance providers to quickly appreciate that in terms of costs they are broadly similar when compared on a near 'like for like' basis (for the purposes of defining 'like for like' it is very important to understand that 'like for like' is effectively non-existant due to the legal wording of competing contracts, as such significant contractual differences exist that a qualified financial planning advisor can unveil - for the purposes of this article I am simply referring to those contracts that are designed for a competing and similar market segment)

When considering the purchase of either expat medical insurance or travel medical insurance it should be a process of risks and costs evaluation. Both sides of the equation need to assessed, i.e the insurance contract itself and the premiums charged alongside the costs and consequences of handling hospitalisation fees should they manifest by way of a hospital admission.

Ultimately, we as individuals need to decide whether to choose and accept the health and accident risks posed whilst living and travelling overseas and also be prepared and able to handle the financial consequences or to choose to 'offload' those health and financial risks to an insurance company for a premium cost.

How to assess the risks associated with health and hospitalisation

Prior to making any decision as to whether we can accept the risks and potential financial consequences or 'offload' those risks to an insurance provider we need to have a clear understanding of what those risks are.

In this regard, and with over 30 years of advising clients, I can safely attest to the fact that the vast majority of clients during initial conversations are either unclear or simply have no idea of what hospitalisation, medical interventions, drugs, physiotherapy costs etc are in the jurisdiction they will be living or travelling to.

It is unsurprising therefore that without this all important background knowledge, clients are simply unable to effectively evaluate the potential costs of treatments in far away lands and therefore by definition the risks involved.

Hospitals will not and do not routinely advertise treatment costs.

There is a general lack of enthusiasm on the part of hospitals worldwide to disclose treatment costs to the wider public. As such and to get some idea of potential treatment costs and fees it makes absolute sense therefore to review what medical insurance companies actually pay for a variety of treatments across the jurisdictions in which you are living or travelling to.

In the image below Morgan Price International provide a snapshot of just a few claim payments made in South East Asia during 2021.

morgan-price-international-hospitalisation-payment-costs

Examples Of Actual Client Claim Payments Made & Paid By Morgan Price International

The GoFundMe culture

I referenced the sentence to choose to accept the risks and be prepared and able to handle the financial consequences above and would like to focus on the part that says "...to handle the financial consequences"

It has become blatantly clear in recent years that a growing number of expatriates and travellers have seemingly made ill-advised decisions in respect of their expat medical or travel medical insurance arrangements and are, in alarmingly growing numbers, resorting to the begging bowl that is 'GoFundMe' appeals.

This growing number of individuals and / or their families, by definition are simply unable to shoulder the financial consequences of medical events or mishaps.

Clearly these dangerous trends need to be addressed. Maybe we should start with "why decisions to effect either zero protection or inadequate protection" are made.

Could this be as a result of being unaware, being mis-informed or a conscious choice to ignore the financial consequences of hospitalisation?

Each case will no doubt yield a different answer, or combination of answers, but it is the objective of this blog to at least educate and hopefully allow the reader the option to make informed choices on the risks associated with living or travelling overseas.

The tragic case of Jill Dodds, an expat school teacher

The case of Jill Dodds, a 47 year old teacher from Morpeth Northumberland in the UK, whilst working in Thailand has been widely reported on in the UK media and serves to illustrate several of these points.

The various articles written, outline that the expatriate teacher had been living and working for 6 years in Thailand when tragedy struck.

By all accounts Jill Dodds was enjoying an end-of-term celebration when she decided to take a picture on a balcony in mid December 2021. The balcony she was standing on collapsed and she fell 20ft resulting in one crushed vertebrae and another fractured leaving leaving her with no mobility or movement in her legs and no use of her hands and fingers, meaning she needs full-time care.

Her sister Katie, based in the UK stated "She can't hold anything, she has to be spoon-fed and she needs a straw to drink but she can talk and move her head."

Katie also said:

Jill's health insurance covered a trip in the ambulance and her stay in ICU at a private hospital. But her coverage has now been used up and she has been moved to a government hospital.

"She had an operation where metal rods were inserted to take some of the pressure off her nerves.

"They don't know about long-term damage at the moment. We were initially told it would take two years before she would be walking again but we just don't know."

jill-dodds-paralysed-schoolteacher-with-inadequate-medical-insurance

Jill Dodds with her Mother Prior To Her Tragic Accident

Questions & lessons

Clearly the Jill Dodds incident is a tragic, innocent and unforeseen accident that will have very long lasting consequences for both Jill Dodds and her family.

The likelihood of ongoing medical interventions and the costs that will inevitably mount as a result, will be just some of the hurdles that await her and her family.

We do not have the full details and circumstances surrounding Jills' case but questions and lessons do emerge.

From Jills sisters statement we know that some medical insurance protection was in place, but clearly not enough.

  • Did Jill fully understand the costs of medical services in Thailand?
  • Was inadequate medical insurance protection purchased due to the attraction of a cheap premium?
  • Was the insurance contract fully evaluated and the inherent limitations understood?
  • Was the insurance contract written and governed by the laws in a language and jurisdiction Jill was comfortable with?
  • Was it Jills choice to accept the limitations of such an insurance contract?

As it stands now, Jills' future and the ongoing medical care that she may receive is now dependent on the good wishes of others - Jill, nor her family, have any control over these matters.

If you are, or even considering, living or travelling overseas it is of paramount importance and incumbent upon you that you educate yourself with the risks involved of living or travelling overseas and make a true and honest assessment of whether you have the financial resource to handle any mishap or medical intervention that you may very well need.

If you need help, advice or guidance with expat medical insurance for living or travelling overseas we have extensive experience to assist - Just ask

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