Health insurance is a contract that requires an insurer to pay some or all of a person’s healthcare costs in exchange for a premium.
The Capital Markets Authority in Oman, the financial regulator, has released the new mandated medical insurance Law, Unified Health Insurance Policy and the Health Insurance Rules under Decision No.78/2019 through Resolution No 34/2019 – For the Issue of Unified Healthcare Insurance Policy Form.
The Health insurance market embraces itself for another mandated health insurance law in the Sultanate of Oman. Residents in Oman will be required to have in place a minimum level of medical insurance coverage with minimum benefits pursuant to the prescribed provisions of Resolution No. 34 of 2019 For the Issue of Unified Healthcare Insurance Policy Form, which was issued by the CMA as at 24 March 2019 and is now in force.
The application of the Law is relevant to the employer market and the beneficiaries arising from those relationships including employer, employee and dependents.
The Policy must be completed and submitted by the Insured as a legal obligation. The Law, as currently prescribed, addresses application, coverage, mandatory minimum benefits and claims management.
Chapter Two is of interest, as the preamble defines a wide interpretation of what shall constitute the contract of health insurance, which includes all basic information, details and common practices in healthcare insurance contracts, etc. Insurers will need to take care of their pre-contractual documents, as these could for all intents and purposes unintentionally constitute the contract of insurance. Chapter Two further sets out the general terms and conditions, placing obligations on the insured to disclose correct and accurate information.
The Code of Conduct for Insurance Business issued by the CMA requires insurers to inform insureds of their duty to disclose relevant information. Omani Law, therefore, applies the duty of utmost good faith. Chapter Two also prescribes the excluded conditions from the coverage under the Policy.
The overall combined limit under the Policy is OR 4,500 in terms of financial spend, so surprisingly much lower than the United Arab Emirates and KSA mandated schemes. Inpatient treatment limits for the policy year is capped at OMR 3,000 and includes usual basic cover, i.e. admission in hospital or day-care, cost of treatment, room cost, consultant fees, diagnosis and test, medicine, ambulance cost and companion cost, also including the cost for pre-existing and chronic conditions for in-patient treatment, while the latter is excluded for out-patient treatment.
Hospital admission under the Policy must be in a joint room and is limited to 30 days at each instance, whereas the ambulance cover is limited at OR 100 each trip. Outpatient treatment is limited to OR 500 for each policy year and the cover is limited to consultancy fees, diagnosis and tests, pharmacy fees and lab fees. Additionally, the Policy includes the cost of repatriating a deceased beneficiary to their country of origin, for which a limit of OR 1000 has been allocated.
Any departure from the basic benefits is not permitted unless agreed as a Schedule to the Policy and signed by both parties and should additional benefits be opted for by the insured, they must be set out in the Optional Benefit Schedule format provided in Appendix 3 to the Law.
Appendix 4 to the Law sets out the mandatory basic minimum coverage under the Policy, which provides two options to the Insured based on which premium will be determined by the Insurer. While both options have the same coverage terms and limits, the first option provides for deductibles on certain categories and the second option does not require deductibles to be paid by the beneficiary.
The deductibles on the first option are limited to outpatient treatment only and are set at 10% for medicine, subject to the limit of OR 5 per visit and 15% for consultancy fees, diagnosis and lab fee for providers within network and at 30% for Providers outside the network.
While the Middle East insurance market is to a large extent geared up for the new mandated health insurance requirements in Oman based on previous experiences with the KSA and United Arab Emirates markets, they should no doubt see the opportunities for top over coverage in Oman given that the minimum coverage is very basic in nature.
Of interest, Oman has not applied licensing for third party claims administrators at present, which also presents opportunities in this market.