How to use your employer-provided health insurance in China – and avoid its pitfalls
Healthcare in China is not free, and hospitals are not required to provide treatment without payment. That means an accident or illness could wipe out your cash reserves – or even cost you your life, if you need treatment and cannot get access to money.
Fortunately, all employers are legally required to provide health insurance. But using these policies can be tricky, because they offer complete coverage for some types of treatment, partial coverage for others, and, for still others, no coverage at all. And if you are working at a Chinese-owned company, you may only be given access to Chinese hospitals.
You should understand how this system works in order to make the right decisions to protect your health - and your bank account. It may also be a good idea to buy commercial insurance to round out your coverage or give you access to privately run foreign hospitals.
Here is what you need to know.
Social medical care insurance
There are two types of medical insurance that expats working in China can have: social medical care insurance, which is jointly paid by the expat and the employer, and commercial insurance purchased by oneself.
How it works
The social medical care insurance scheme covers all employees in China, including foreigners. The employer pays six percent of the employee’s total salary into the scheme, which goes into a pool of money that goes to hospitals and also covers some treatment for outpatients with chronic diseases. Employees also automatically contribute two percent of their paycheck, which goes into a special personal medical account. They then receive a card for this medical account, which can be used to pay for both medicine and visits to the doctor.
Once you start to work, your employer will help set up your account at the local Human Resource and Social Security Bureau. This account will follow you wherever you go, and you can withdraw from it when you retire.
People who don’t work for companies — such as freelancers, consultants and small businessmen — can pay for medical insurance by themselves at their local Human Resources and Social Security Bureau.
Foreigners use the system in the same way as Chinese citizens. Your permanent social security number will be formed using the country or region code of your home country, and your passport number or Permanent Residence Certificate number. Even if your passport number or ID type changes, your social security number will remain unchanged.
What is covered, and what is not
Treatment and medicine are divided into three categories. Category A is wholly covered by social medical insurance. Category B is partially covered, with 80 percent of the cost normally covered. Category C is not covered at all and must be entirely paid by you.
If you want to have your insurance cover all your treatment costs, let the doctor or pharmacist know. Otherwise, they may provide you with forms of treatment that are not covered by your insurance. This is particularly important if you are hospitalized, because costs can build up quickly.
Doctors normally will communicate with you on what medicines will be used, giving you a chance to insist on those that are fully covered.
You can swipe your social medical insurance card at many pharmacies, clinics and hospitals to pay for medicine and treatment not fully covered by your insurance.
Pharmacies that accept social medical insurance cards will have signs at the door, such as “省医保定点药店” (shěng yībǎo dingdiǎn yàodiàn, pharmacy designated by provincial medical care) or “市医保定点药店” (shì yībǎo dingdiǎn yàodiàn, pharmacy designated by city/municipal medical care). Pharmacies without such a sign will not accept social medical insurance cards, and patients cannot make claims on medicines purchased from such a pharmacy. So unless it’s an emergency, avoid pharmacies that lack this designation.
Where to go for treatment
China divides all hospitals and medical care centers into three levels. Tier One indicates a clinic or primary care hospital, where people are expected to go first with ordinary ailments. A Tier Two hospital is a regional hospital taking care of multiple communities, with more specialized equipment and staff.
A Tier Three hospital is intended to handle serious, complex cases referred by other hospitals, and is used for research and teaching. These hospitals have advanced facilities. Because they have the most talented doctors and equipment, people tend to go to these hospitals first for even minor ailments, something policymakers are trying hard to discourage. Hospitals in each tier are sub-divided into three to four levels according to their facilities.
This matters to you because the higher a hospital is ranked, the higher its deductible, which you must cover fully before your insurance kicks in. For more information on hospital classifications, go here.
In Beijing, the deductible at a Tier Three hospital is about 1,300 yuan for inpatients, and social medical insurance covers only 70 percent of any fees over that — for Category A treatments that are “fully covered” by your insurance.
In addition, there is usually no coverage after your bill hits 170,000 yuan, although you might get lucky and find certain diseases are covered above that amount.
So for example, if a patient racks up a bill of 11,300 yuan in the Level Three hospital’s inpatient department, the patient will need to pay the 1,300 yuan deductible, and pay 30 percent of the remaining amount — 3,000 yuan.
At a clinic, on the other hand, the deductible will typically be much lower — around 650 yuan in Beijing. Insurance only covers 50 percent of the cost over 650 yuan, and stops at 2,000 yuan. So, for example, if a patient spends 1,650 yuan at a clinic, and uses only category A treatments, the bill will be 1,150 yuan.
Some medical care is not covered by insurance, including false teeth, hearing aids and cosmetic surgery.
How to make a claim
In order to make a claim, you will need:
- Your ID and social security cards.
- The original copy of diagnosis certificate issued by the attending doctor.
- The original copy of the medical history records, physical examination result report, and other relevant medical records.
- The original copy of the fee receipt issued from the hospital with a proper finance and tax administration stamp.
- The printed details of the charges from hospital, or a prescription written by doctor.
- If medicine is purchased from a pharmacy, a uniform invoice of goods sales, and printed copy of details of purchase should be provided.
This may sound arduous, but is made easy by the fact you can generally file your claim on the spot at the hospital as you pay. The hospital will handle recovering the amount covered by insurance. You simply need to pay your portion.
You can supplement or replace the coverage provided by social medical care insurance by purchasing a commercial insurance policy. In addition, these policies can give you access to private hospitals not included in the social medical care scheme.
There are many insurance companies which deal with the health care concerns of foreigners living in China. These plans can cover dental care, glasses and contact lenses, maternity costs, and even evacuation to a hospital in your home country.
International insurance companies conducting business in China
These include: Aetna, Allianz, AXA PPP Healthcare, Bupa and Cigna. Agencies and brokers that help expats choose an international insurance company include China Expat Health, China Health Insurance, Expat Medical Insurance and Shanghai Expat Insurance.
Chinese companies offering private insurance
China Life offers basic health insurance covering major diseases and injuries, but does not offer coverage outside China. Insurance can be purchased through brokers, or here, after typing in the name of your city.
Ping’an China offers plans that cover basic health care and major diseases (remember the 170,000 yuan cutoff? This can protect you if you go over). International travelers can also find plans covering worldwide health care needs. For more details, call 400-883-3663 and dial 2 for English service.
Taikang Life has detailed plans for different demographics, like mothers, seniors and children, at a relatively low rate. If you are considering basic coverage, this may be an option. Plans can be purchased online.
Chinese hospitals currently do not directly accept claims from private insurance companies. Patients should keep good records of medical treatment and all receipts to make a claim from commercial insurance companies after paying Chinese hospitals. Patients with commercial insurance should check and clarify which hospitals and what kinds of treatment the insurance will cover.