In his interview with "Al Roaya", Gregorowicz said that the local market cannot tolerate this number of companies, which led some to leave the market or simply manage the claims of companies affiliated with "Captive Business".
Regarding the exit of some reinsurers from the market, Gregorowicz clarified that one major company has moved away from health insurance in the region, while other companies preferred to be selective, reduce the size of membership subscriptions, and stop working with some companies with poor track record and those which turn technology into a burden instead of making use of AI for improving performance.
He pointed out that the issue was mainly related to misuse of "artificial intelligence support", non-pricing on the basis of the data obtained, and persisting with price competition as a basis for subscription and expansion.
To begin with, what are the most prominent developments in the health insurance sector?
Today, the culture of insurance has become entrenched in Dubai and Abu Dhabi, and even in some other Emirates, there are requirements of basic insurance. Furthermore, several new healthcare providers have entered the market, creating competition between medical facilities and reducing the inflation process resulting from price competition.
Does this mean lower prices or inflation in the cost of insurance?
No, this does not mean falling prices. Prices are actually rising, but not at the same rate as before. It will not rise due to the medical centers ’exaggeration in price increase, but will rather be linked to overall inflation, entry of new products and services, and high insurance consumption. And there is no doubt that high insurance consumption is related to many factors, such as including awareness of basic packages, aging, and others.
Many holders of basic insurance policies do not benefit from them, and only get them because they are a condition for obtaining residence permits. What are your views on this?
In fact, this was true in the past, but the situation has recently changed. The use of basic insurance policies has increased significantly over the past years, and when the system was completed in Dubai, for example in 2017, the premium consumption rate was around 60 to 70%, Today, 100% of the premiums for this type of insurance are fading, so we can see that it has not sustained, as the subscribers who carry the basic documents have become aware of the coverage, the centers, and the mechanism of obtaining the service.
Some say that these documents are not useful?
This is not true, as basic insurance involves a lot of good and useful coverage, and it differs from enhanced regular insurance, which is only a type of comprehensive medical network and claims management method, as it requires specific conditions to obtain the service, and this does not mean that the service does not exist.
For the total medical insurance sector, what are the causes of the loss?
There is no doubt that part of the losses is a result of basic insurance policies we have discussed, and another part is mainly due to the non-technical pricing policies adopted by some companies, as well as speculation governs the policies of some companies that compete only on the basis of pricing. On the other hand, there are many companies that operate according to professional foundations and have achieved profits, as it prefers to lose a portion of its market share to engage in unaccounted competitions.
We saw some TPA companies, including "Score", which is one of the 10 largest companies in the world, leaving the health insurance market in the UAE and other countries in the region. What is your say on that?
Some reinsurers considered that the health sector in the region is no longer feasible and not compatible with their strategy. And in general, in the medical sector there are a few TPAs that reduced the size of their subscriptions, and refrained from dealing with some companies, while maintaining its relationship with companies that it deems professional.
What about companies that Nextcare deals with?
In fact, the general companies that we worked with were understanding and preferred losing some portfolios over losing their premiums. We also tried, in agreement with them and with service providers, to work to control waste caused by exaggeration in the provision of treatments, and the providers understood that we based our discussions on international practices in this this field.
There is an exit for medical claims companies from the market, what do you think about this issue?
There were over 25 TPA companies in the local market, and in fact the market cannot sustain this large number of companies. And while 4 companies share about 85% of the market, the other 20 companies compete for only 15%, and we, at Nextcare, control about 20% of the total insurance market. The competition of some small companies is limited to mandatory insurance, while some companies specialize in managing the claims of their partner companies.
What are the methods to combat fraud in the medical sector?
There are many methods or tools, such as artificial intelligence, which helps in the analysis of claims and the detection of faulty sections, as well as personal checks on healthcare providers, in addition to complaints received by members, as well as secret shoppers.
It is said that most fraud is of dental insurance?
There is no doubt that the cost of dental treatment in the local market is high, and it involves some cosmetic treatments, and these things result in some untruthful practices on behalf of both the healthcare provider and the customer. However, in general, the TPA companies are able to investigate and discover such practices through the records.
Some insurance companies have invested in advanced technologies in the field of marketing, claim management and detection of fraud, but they were not successful, and this technology was a burden on them instead of helping them to improve profits. What do you think about that?
This results from the wrong use of technology, as many companies which have adopted technological solutions have succeeded. Therefore, failure is related to misuse of the technology. After all, technical analysis leads to results from which you can draw limits in order to price correctly, and some companies have not adhered to that and resorted to wrong pricing policies despite of the fact that they knew it. And therefore, AI is innocent of being a burden to some.
What is the percentage of online sales of health insurance policies?
The percentage of general health insurance is 10%, and 30 or 40% for basic medical insurance policies.
Source: Al Roaya Publication Interviews; English translated version.