After some twists and turns, the measure simplifying the conditions for terminating health insurance contracts will be discussed in the National Assembly from Wednesday, March 20 and in public session on March 27.
Here are some answers to unravel the true from the false.
1. French People Can Already Simply Change Their Health Insurance Every Year. This Measure Is Of No Interest.
FALSE. 46% of French people do not know how to properly terminate their health insurance contract on the anniversary date. The current regulatory framework is asymmetrical (deadlines, form and terms) and leads to abuse by insurance organizations who simply “play the watch” (sending price increases a few days before the termination date and sending price increases a few days before the termination date, etc.) or refuse the request for lack of formality in order to automatically renew the contract. There is also insufficient time to calmly find a new offer in the event of a price increase (20 days).
2. The French Benefit From A Good Level Of Coverage Of Their Health Expenses. The Budget Allocated To Complementary Health Care Is Not A Priority Subject.
FALSE. Each year, health insurance is a compulsory item of expenditure of more than 30 billion euros for the French. For French companies which finance up to € 16 billion each year to cover their employees, this represents 3% of their payroll. The increase in contributions reached + 4% in 2018 (+ 15% since 2010). The only stabilization of contributions thanks to better competition would generate a significant gain in purchasing power by making it possible to redistribute more than € 1 billion each year.
3. Complementary insurers lose money. There is no hidden pot and more competition will not lower costs.
FALSE. It is true that certain players market on average “at a loss” health insurance contracts for companies by catching up in particular on “provident insurance” (the margins on guarantees in the event of death amount to 40% on average). This is not the case for individual contracts. The gross margin available to absorb the costs of the mutual is 20% of premiums (26% for individual contracts) while the French pay € 35 billion in contributions each year. If the financial results are weak it is due to sometimes exorbitant management and distribution costs (advertising campaigns, sponsorship and significant margins granted to intermediaries).
4. Facilitating Termination Conditions Will Lead Players To Spend More On Marketing Costs. Increasing Competition Will Increase Premiums.
FALSE. Beyond the economic misinterpretation which would like more competition to lead to an increase in prices, this idea reflects a flawed economic model where the rigidity and the opacity allow the mutuals to bear very high distribution costs by amortizing them over several years. Giving power back to users (families and businesses) will in fact require complementary organizations to invest in order to offer quality service (rapid reimbursements, assistance in accessing affordable care, etc.) and to think twice before any increase massive contributions.
5. More Than 500 Complementary Organizations Offer Complementary Health Insurance Guarantees. There Is No Competition Problem And The French Already Have Access To A Plethora Of Different Offers.
FALSE. The number of players is not synonymous with dynamic competition and innovation at the service of users. In 2016, the French Prudential Supervisory Authority (ACPR) issued its first license to an independent French player since … 1986! Behind the “facade” diversity of players are hiding large insurance or mutual insurance groups (the ten largest players cover nearly 50% of the population). At the end of 2017, more than a quarter of mutuals were “substituted”, that is to say without any other activity than the administration of the structure of the mutual itself.
6. Facilitating The Conditions Of Termination Is An Attack On Solidarity Between The Insured And Promotes Opportunistic/Consumerist Behavior.
FALSE. The bill provides for a minimum commitment of 12 months before being able to terminate, at least as much as the current framework for annual termination. It offers better safeguards against opportunistic behavior: contracts are now artificially calibrated on January 1, an opportunistic insured today has an interest in insuring themselves in the middle of the year to cope with expensive programmed care and then terminate before October 31 as authorized by law and contract.
On the contrary, the measure will primarily benefit the public least informed of the complex termination rules and who find themselves captive to rate increases (retirees, fragile population, managers of very small businesses without a dedicated internal team, etc.). Finally, the obligation to remain covered for at least 12 months will continue to ensure solidarity between the sick and the healthy.
8. Being Able To Cancel Your Complementary Health Insurance During The Year Will Cause Unpaid Bills To Explode Due To Third-party Payment Cards Without Rights Used By Health Professionals.
FALSE. It is a blackmail by certain actors to scare health professionals and block the bill. 97% of French people are covered by a complementary health contract and will remain covered after the measure since it provides for a 12-month commitment.
In addition, today many cases already lead to the circulation of third-party payment cards without rights (when the insurer sends the third-party payment card when the contract has been terminated) or whose rights stop in during the year (change of company of employees, end of short contract, marriage, divorce, retirement, etc.), without any difficulty. Residual cases of use of a card without rights are fraud and must be treated as such without penalizing all French people.
9. This Measure Is A Technical Measure That Does Not Interest The French.
97% of the population is covered by complementary health insurance. Returning power to users in terms of complementary health insurance is a concrete measure in favor of purchasing power and administrative simplification for almost all French people.
The IFOP conducted, for Alan, a poll at the end of January 2019 which confirms a massive interest in the measure: 94% of French respondents (96% of retirees) are in favor of a bill allowing to change complementary when they want it after a year of contract.
10. This Measure Requires Significant Adaptation Time For The Actors. It Cannot Enter Into Force Before The End Of 2020.
FALSE. The measure does not require any “adaptation time” on the part of the actors: neither in the management of contracts or claims, nor in the drafting of contracts. It is important that these provisions come into force on January 1, 2020 to quickly produce their effects. Delaying to the end of 2020 means taking the risk of letting the actors use the reform as a pretext to justify a significant increase in premiums at the end of 2019 without the insured having the opportunity to simply face it. In 2018, the increase in health insurance contributions (+ 4%) already cost the French more than 1 billion euros.
As you will have understood, at GoViralBuzz , we believe that simplifying the terms of termination at any time after one year is an excellent measure for French people. We have been offering this possibility for all of our policyholders for over 2 years.
We’d rather spend time creating an incredible product for our users than trying to hold them against their will.
This obliges us to always offer the best level of quality and to develop new services for our policyholders. This also encourages us to be vigilant about the level of our prices. In 2018, we decided to lower prices for our policyholders for the second year in a row.