The pandemic has brought huge changes to healthcare insurance but perhaps nowhere as much Qatar, where it may have helped usher in a mandatory insurance system.
Amber Musson-Thorp, commercial head of Lifecare International in Qatar is predicting a boom when the law, currently in draft form, comes into force, likely this autumn.
The lifting of the political embargo between neighboring Gulf Cooperation Council (GCC) countries at the start of this year is also adding to confidence.
The reform envisages various patient rights and duties, including establishing the right of citizens to receive services at government facilities free of charge and, most importantly for insurers and brokers, requiring all foreign residents and visitors to have private health insurance to receive care.
Musson-Thorp (pictured) estimates that currently perhaps 10% or 260,000 people have domestic insurance and a tiny percentage of them international cover.
Of course, foreign residents represent nearly 90% of the population so the market is set to expand dramatically.
She says: “The market here in Qatar expected compulsory health insurance to come, but not for at least two to three years. We believe the reason why this has accelerated was the pandemic.”
Other factors were also at play. There was over-utilisation of the state-backed Hamad Medical system with reports that some people could not get an appointment for non-urgent care until 2022.
She also believes that increasing scrutiny of conditions, especially from the Asian subcontinent population, who make up a lot of manual labour force, may also have encouraged the move.
“These three things created a perfect storm, which basically pushed the issue to the fore and saw this draft bill move ahead.”
‘Fantastic window of opportunity’
Musson-Thorp now expects the system to set minimum coverage, to involve local Qatari insurers and to be linked to employer sponsorship as in the Kingdom of Saudi Arabia (KSA), Dubai and other United Arab Emirates (UAE) states.
She adds: “When you mandate anything, you start with minimum benefit requirements, so initially people will just buy the cheapest level that they have to, because they’ve been mandated to do so.
“We believe the market will change over the next two or three years as it did within the UAE, because while you buy the minimum benefits for lower paid staff, it prompts firms to start talking about health insurance more, so the management might be offered a different tier, then executives another.”
“The companies may recoup the money from their employees, subsidise premiums, or pay for staff but not their dependents at implementation stage – along those lines.
“Whatever the case, the market will change immediately because everyone is talking about health insurance. So, we have a fantastic window of opportunity.”
Regulation and trade bodies
Qatar has dual regulators with foreign-owned companies coming under the Qatar Financial Centre (QFC) Regulatory Authority and the larger concerns, which must be 51% Qatari owned, supervised by the Qatar Central Bank.
Musson-Thorp says part of the work now will be to make sure the QFC-regulated sector has access to all the information they need about the reforms. She is also taking part in discussions about forming a trade body.
“It is so much more heavily regulated in the Europe and the UAE so I can bring some of that knowledge and experience of what we’ve done historically, into the Qatar market, which I think is fascinating,” she says.
Of course, the market still has significant challenges. It is not strongly intermediated and the larger companies tend to work directly with local insurance players.
There is a strong attachment to the Hamad system, and indeed some wariness of intermediaries – more certainly than in the European markets but also more than in neighbouring GCC states.
The political embargo which began in 2017 brought restricted travel and saw the withdrawal of some international firms from Qatar.
That in turn prompted a process of ‘Qatarisation’ of business, though this is something she feels was very understandable in such a fraught political and economic situation.
“There is definitely a feeling here of ‘we need to look after each other, stick together and maintain revenue into the state of Qatar where we can’,” she continues.
“I think it’s the right thing to do, if you’re in that situation to keep everything in house if you’re fighting for your life.
“We’re the richest country per capita in the world. Qatar has done a fantastic job of diversifying the state’s interests, investing heavily into sports and education, but they made a decision that large companies, especially government owned companies should revert their insurance back to onshore Qatari based firms.”
Regional vs global insurers
Indeed, some Lifecare customers moved back to regional insurance companies from offshore global players which in turn impacted the international health insurance market.
Musson-Thorp says that Lifecare had tended to specialise with tier one insurers so global providers such as Bupa and Cigna for which they are sole distributors, Allianz, Aetna and United Healthcare who Lifecare have supported bringing into the Qatar market.
“We had to make a conscious decision to shift focus into the local insurance market to maximize growth through 2020 and beyond,” she says.
It has been interesting because for some local insurers there is less of a desire for growth, sometimes because they are an arm of a bank or another business. You just don’t feel the same hunger with the providers, as you do outside of Qatar.”
Intermediary market on the back foot
And a big proportion of local business is directly distributed. She adds: “You realise that you don’t have the same distribution power that you have in the European market, in the UK, US or wider GCC.”
At times, the intermediary market felt like it was on the back foot, until early January, when the embargo was lifted and in late February, when it was announced that compulsory health insurance would be mandated.
With local insurers likely to benefit most from the reform, Musson-Thorp will continue to build on strong relationships with local partners.
She says the market is still some years behind other local markets and it is rare to have a discussion with an employer about the value add of insurance or wellbeing, but she thinks it will come with time.
It is also likely that rising costs could bring change. For example, she has started some conversations about the potential for third party administrators and providers to implement procedure pricing, similar to what happened in the UK many years ago which helped manage cost containment, as there is a tendency to overtreat.
UK was not strict enough
It is not all about Qatar catching up though. The system has shown resilience in lockdown, something Musson-Thorp has great insight about.
It applied strict quarantines to travellers early on, created a tracking (Ehteraz) app which had to be downloaded at point of arrival and shown when entering any indoor space, but which then afforded many freedoms.
Given everything here is linked to your visa which is an employer sponsored system, there was broad compliance.
Indeed, many of the strictest elements of lockdown were thus avoided.
“People here adhere to the rules because the consequences are not just on you. It is all linked to the ability to reside here and your employer.
“It became immediately clear to me coming from the UK perspective, we were just not strict enough.”
The new system is linked in a similar way so that should also drive its success.
She adds: “Health insurance in Qatar just wasn’t seen as a necessity, however this looks set to change in 2021 and we look forward to the industry boom here in Doha over the coming years.”