Does health insurance go up if you use it?

Did you know that the 7th of April is designated as “World Health Day” by the World Health Organisation (WHO)? This date has been observed since 1950 to raise awareness about overall health and well-being around the world – and I´m sure you would agree that nowadays, with the internet, we have much more access to health and well-being information at our fingertips.

Apparently, there are more than 70,000 health related searches on Google every minute, which equates to over 1 billion questions a day. This includes questions about conditions, medication, symptoms and insurance questions. One of the most common questions that people have when it comes to health insurance is whether using their insurance and making a claim will cause their future premiums to go up. 

This is a valid concern, because, although we are fortunate to have access to a public healthcare system in Spain, as in many countries with a national health service, many people also opt to take out private health insurance or are lucky enough to have cover provided as an added perk from their employers. Having private health insurance cover gives people an added sense of security, financially, physically and emotionally, that they can quickly access medical care in the event of illness or injury. 

But, back to the million-dollar question…does health insurance go up if you use it? 

Firstly, let's start by explaining how health insurance works. When you sign up for a health insurance policy, you pay a monthly premium to the insurance company. In exchange, they agree to cover your medical expenses up to a certain amount. The amount they cover depends on the type of policy you have and the specific terms of your contract. Some policies may cover all medical expenses, while others may only cover certain types of treatments or procedures.

Now, when you actually use your health insurance to pay for medical expenses, the insurance company will pay the healthcare provider directly, up to the maximum amount specified in your policy. Many health insurance plans include cost-sharing measures, such as deductibles and co-payments. These measures require policyholders to pay a portion of their healthcare costs out of pocket, which can help to reduce overall healthcare spending. 

So, does using your health insurance to pay for medical expenses mean that future premiums will go up? 

The answer is not straightforward and, as with many things in life, the short answer is, it depends on your policy and the terms of your contract.  In general, health insurance companies do not increase your premiums simply because you use your insurance to pay for medical expenses. However, there are a few scenarios in which your premiums may increase:

1. You reach your policy's annual limit: Many health insurance policies have an annual limit on the amount they will pay for medical expenses. Once you reach this limit, you may have to pay for additional expenses out of pocket. If you consistently reach your annual limit, your insurance company may raise your premiums to reflect the higher risk.

2. You require expensive treatments: Some medical treatments are more expensive than others. If you require a particularly expensive treatment, such as major surgery or a long hospital stay, your insurance company may raise your premiums to reflect the higher cost.

3. You have a chronic condition: If you have a chronic medical condition that requires ongoing treatment, your insurance company may raise your premiums to reflect the higher risk. This is because they know they will be paying for your treatment over a longer period of time.

4. As with other areas of insurance, health insurance premiums often have incremental annual increases, due to general changes in the specific sector and any changes to personal situation or coverage required by the policy holder. 

• For example, insurers re-calculate the policy price and any applicable co-payments, on an annual basis, to confirm the following annuity based on a number of variables. This includes calculations relating to increases in the Consumer Price Index (CPI) for the health sector, which essentially means that prices are adapted according to any inflation or annual increase in medical costs or additional medical advances within the health system. 
• In addition, other factors that are included in this re-calculation are frequency in use of guaranteed coverage, updating personal variations to the situation of the policy holder, such as age, the number of people or geographical location of the people included in the policy contract, and also any promotional offers or conditions specified at the time of contracting the policy.

Any rise in insurance premium is done for each annual contract renewal and changes must be communicated to the policy holder in advance of the renewal period. In terms of renewals, either party may oppose the annual extension by written notification to the other, usually within a notice period of 1-2 months, depending on the details in the small print of the policy. 

Many people worry that insurers may cease to renew their contract if they suffer from a serious illness or are currently undergoing hospital treatment at the time of the renewal. However, reputable insurers such as Caser Expat Insurance do not oppose extension of insurance contracts in a wide range of situations as long as the first diagnosis of a serious illness or hospitalisation has occurred during the registration period in the contract. As with the point above, it is important to check the specific clauses and small print of your health insurance policy, at the time of taking out the cover. When getting quotes and information about a health insurance policy it is prudent to ask the insurer questions about their terms for coverage under these circumstances so they can explain the full details and you enter into the contract with the full picture.  

It's worth noting that in Spain, health insurance premiums are regulated by the government. This means that insurance companies cannot increase premiums for individual policyholders based on their health status or medical history. However, they can increase premiums for an entire group of policyholders if the overall risk and proportion of claims in that group increases.

Offering policies with deductibles or co-pay options has also been said to help to regulate the number of claims and minimise any increase of annual premiums in general, because these cost-sharing measures may also incentivize individuals to use healthcare services more judiciously, since they are responsible for a portion of the cost. 

So, what can you do to keep your health insurance premiums from going up? Here are a few tips

1. Shop around for the best policy: Compare policies to find the one that fits your personal circumstance and offers best value for your money.  

   As an example, Caser Expat Insurance offers a range of different packages so that you can choose the best cover for your needs with access to over 45,000 specialists in 13,000+ medical centres. They have information and customer service provision in English for expats who will no doubt prefer to be able to navigate the policy information without having to try to translate the wealth of information. 

   You can choose from 4 main types of cover (Medica, Activa, Integral and Adapta + Dental) which offer you a choice of policies with or without co-payments, and with or without hospitalisation cover. 

   You can quickly receive a quote based on your province and your date of birth. For example, if you in your mid 40´s, or as I prefer to say Generation X, and living in the capital, prices are from around 35€ to 75€ per month. The quote will show you the breakdown of different policies and you can also compare the different benefits of all their policies using the useful comparison option available. 

2. If you don't anticipate needing medical care often, a policy with a higher deductible or co-pay may be a good option for you as these policies generally have lower monthly premiums.  

3. Use your insurance wisely: While you shouldn't avoid seeking medical care when you need it, you can still use your insurance wisely to keep your premiums down. For example, depending on the situation you can weigh up whether you really need to access private treatment or if you can access the treatment via the public system available to you as a Spanish resident. 

4. And last but not least…Live a healthy lifestyle: This may seem like a no-brainer, but living a healthy lifestyle can actually save you money on your health insurance premiums. Insurance companies may offer discounts to policyholders who don't smoke, maintain a healthy weight, or participate in regular exercise.

It is also comforting to know that many health insurance plans include certain benefits that are designed to encourage preventive care and early intervention. For example, many plans cover annual check-ups, screenings, and other preventive services at no cost to the policyholder. By encouraging individuals to live healthy active lives and seek preventive care, insurers hope to catch any potential health problems early on, when they are easier and less expensive to treat.  This also helps the overall industry to avoid the cost of health insurance going up by minimising the number of people who need to use more expensive treatments. 

As Virgil, the ancient Roman poet said, “the greatest wealth is health”, so it’s not just a question of money, it’s a question of being aware of your own health, your lifestyle, and doing your bit to minimise any treatment you may require and claims you may need to make. In Spain, we have the privilege of being about to access both the public and private healthcare systems in order to receive a whole host of treatments, and if we all work together to use them sensibly, we can help to minimise the impact on these services, and the price we have to pay, to live longer healthier lives. Do you have any other query about: Does health insurance go up if you use it? If so, write it down in the comments and we will try to help you.