Dubai: Dubai residents holding a basic health insurance policy will need a new policy or an upgrade to keep buying prescribed medicines under insurance coverage.
This comes after several branded medicine prescriptions that were earlier part of the Dh600 a year ‘Essential Benefits Plan’ were removed mid-February. The intention was to offer a unified set of medicines – principally generic ones - under the basic policy and help lower the burden on insurance companies from claims.
“Any medicine not covered as part of the unified ‘formulary’ will be taken on cash basis from the patients,” said Vikas Katoch, Chief Operating Officer at Right Health, one of the fastest growing healthcare operators in the country. “The aim is to ensure unified access to the most effective medicines and treatments – and it’s only applicable to Dubai.”
This came into effect from February 18 as part of the Dubai Health Authority’s ‘ISHAD’ insurance system for healthcare in Dubai.
For an upgrade, probably for those with no preexisting condition, it should be around another Dh800-Dh1,000. An enhanced basic plan premium comes to around Dh1,200-Dh1,500 per year
What has changed?
The Dubai Health Authority mandated insurers should start providing generic medication on basic plans earlier this year.
"They also reduced the generic medication list from 2,500 listed approved medicines to around 700," said Amir Hussein at InsuranceMarket.ae.
"There were various reasons for this, one being that having so many options available - and sounding very similar to each other - had the potential to lead to errors."
Still work in progress
According to pharmacy industry sources, quite a few widely used medications are now excluded from coverage under basic policies. And that insurers are quite strict about implementation.
“It could mean the insured might have to pay an additional Dh200-Dh400 per visit to a pharmacy to get the medicine of his/her choice,” said a pharmacy staff member. “Or they are trying to find alternative medicines that can still be covered under their basic policies. But the insurance companies have wide discretion on all such approvals or rejections.
“It has meant loss of revenue for pharmacies – that’s also an outcome.”
Upgrade the policy?
The best option – though expensive – is to upgrade from basic insurance cover, which was brought in as part of the move to ensure universal health coverage. Blue-collar workers are the pre-dominant holders of these policies, but with businesses trying to cut costs, several employers have also opted to give basic cover for their staff rather than seek a costlier policy.
“Basic benefits are based on DHA guidelines,” said Dr. Nilakshi Gangan , Manager - Insurance , Aster Hospitals UAE. “If there is no [medicine] coverage for basic, they will have to pay cash or upgrade. An upgrade to a group policy starts around Dh2,000 and above for an annual policy, and if done by an individual, it will be much more than that.”
An upgrade to a group policy starts around Dh2,000 and above for an annual policy, and if done by an individual, it will be much more than that
An insurer’s perspective
For an insurer, the switch to allowing only generic medicines on basic medical policies is about saving on costs. “However, there are very few insurers that have taken up the directive and continued to implement/apply it,” said Amir Hussein, Head of Employee Benefits at InsuranceMarket.ae.
“Insurers cite that the cost savings are not that significant after their negotiated rates with medicine companies. Plus, there is the dissatisfaction created among the insured that have hindered many insurers from adopting this approach.
“The challenges include having the generic medication available, the possible extra time taken for approvals because a branded medication may have been prescribed, or having to go back to the doctor to have prescriptions changed to reflect the generic names.
“All of these lead to an overall additional cost of doing business for insurers. In theory, it is a great way of reducing cost as long as it is strictly imposed and adopted by the market as a whole.
“Leaving some insurers to have an advantage of offering branded medication leads to an unfair competitive advantage. The only other way around this would be to standardise costs of medicines in the market.”