Quality Healthcare for a Lower Fee Can Be Successful

Q: What role can digital innovation play in health insurance?

A: Innovation in health insurance is complex because the products tend to be very structured. In addition, many authorizations are necessary to advance a new product. However, in the Mexican market there is a great deal of creativity in the area of insurance. Life insurance has effectively grown through the creation of various innovative products. In the area of health insurance, many doctors are pushing for more agility related to treatments, but also in the area of payments. This has led to innovations such as direct pay, where the patient is offered a flat fee for coverage of certain health interventions. We also use technology tools to anticipate costs of health interventions and to provide a guarantee of payment.

Q: What is the principal reason why many Mexicans do not have insurance coverage?

A: Statistics show that Mexicans have a high out-of-pocket expenditure. However, the ability to pay out-of-pocket is limited. An out-of-pocket surgery that costs more than US$5,000 is available only to a small group of people. Even an out-of-pocket expenditure of US$250 is not a reality for many Mexicans. We try to offer different packages and products that are adapted to people of different socioeconomic statuses. For lower economic ranges, health insurance costs weigh heavily on the budget of a family. Many people see the deductibles, and they already consider it out of their range. Unfortunately, premiums have been going up in the industry and fewer people have the capacity to pay them. Some group insurance schemes offer premiums at roughly US$260. But if this is too high, a personal product that is offered at an even lower fee may be the answer for an individual. However, this will impact the amount of coverage offered. To provide better solutions, we need to be more creative and come up with more innovative products. 

Q: How can you reduce the prevalence of fraud related to health insurance?

A: Often, people will claim that their degenerative condition was caused by an accident. They will then ask for surgery, for example on the spine, knee, or nose. Our belief at Prevem Seguros is that when you become insured, you also need to provide full transparency about your health status. Therefore, we conduct a medical exam for each person to extract more information. Because of this stricter process, the incidence of fraud is lower. There are things we cannot detect, but these are conditions that tend to have many rules attached. There is also a second evaluation. This can be done by a specialist to see if the doctor in question is providing the right recommendation for treatment. In the US, it is often used to evaluate whether an operation is necessary. In many cases, it is not. This is not just beneficial for us, but also for the patient, as the patient will know whether they are receiving the best treatment for their problem.  

Q: What impact has the change in government and subsequent changes to the healthcare sector had on the insurance industry?

A: When the government decided to reduce the coverage for government-employed people, we thought many people would buy their own individual policy. But it turned out many people could not afford this. As health insurers, we need to generate products that can cover the middle and lower-middle class segment. I have always said that having quality health networks with fixed prices would be an improvement. Many doctors are associated with networks that offer better income. However, there are opportunities to offer quality healthcare to the lower income set. An example is dental care. There are many dental clinics springing up across the country that offer quality care but at reasonable prices. The market observed that private dental care was excessively expensive and reacted. It was proven that people will go to a clinic if the prices are more reasonable. You adjust the way you provide the service to allow you to bring down the price of the care. In the area of traditional coverage, it helps to have hospitals that are good but not too expensive. Fortunately, these kinds of hospitals are growing. One of our solutions is to offer packages and products that contain a fixed predetermined sum for attention. This allows people who are on social security to get complementary health attention for specific issues at private clinics.

Q: Looking to the future, what is your strategy for growth?

A: We are looking to expand our reach beyond Mexico City. Among the middle classes in various cities around the country there has been a great deal of growth in terms of spending capacity. An indicator of this is the growth of malls, which primarily target these groups of people. At the same time, we have seen more hospitals being built and greater investment in health infrastructure. Hopefully, these kinds of investments will continue. One of the initiatives of the government has been to provide greater income for doctors in remote areas. However, many areas still lack necessary infrastructure. This means people still need to go to more urban areas to receive various kinds of healthcare.

Prevem Seguros is an insurance company specialized in major medical expenditures and personal accidents. It offers a range of packages and specialized products that cater to different demographic groups