Health insurance

Q: This question was submitted by Legal Regulations Committee in Al-Thumayry Public Hospital. As-salamu `alaykum warahmatullah wabarakatuh (May Allah's Peace, Mercy, and Blessings be upon you). A month ago, this committee was formed and headed by the General Manager and the eldest son of the owner of the hospital to run all the internal and external dealings of the hospital according to the Shari`ah (Islamic law). The health insurance topped the list of priorities of the hospital. Following, are the details of the system of this insurance. Firstly, the contract: Under this type of insurance, a monthly deductible fee (an amount specified by the terms of the insurance policy) is paid by the person whether they visit the hospital or not. The deductibles vary with the number of people enrolled in the hospital. (Part No. 15; Page No. 317) For example, when the company has 100 employees and the monthly deductible may be 100 riyals per person, the total amount the company should pay monthly is 10,000 riyals. There are two factors that determine the deductible the employee should pay. 1- The number of employees; the more employees a company enrolls the more money should be paid by the company, and consequently more profit goes to the hospital and less risks are expected. 2- There are exceptions agreed upon by the hospital and the company, although not covered by the hospital, it may affect the deductible. Exceptions may be many, thus the amount decreases, and may be small, thus the amount increases. Such exceptions may include, but are not limited to the following: A- Staying in intensive care unit for more than three days. B- Neurological and psychological patients. C- Chronic diseases. D- Cardiac diseases. E- Organ transplant surgery. F- Fixing dentures. The more exceptions the company agrees on, the smaller the sum of money that is paid to the hospital. For instance, there is a company that has 100 employees and the contract of insurance has no exceptions, it will pay 400 riyals per person. (Part No. 15; Page No. 318) Another company has 100 employees and agrees with the hospital to write some exceptions in the contract, it will pay 80 riyals per person. Moreover, under the conditions of the contract any party who is unsatisfied with the contract may terminate it after sending a warning notice, a month before termination. There is another condition sometimes included in the contract that the maximum annual coverage of the person offered by the hospital is 10,000 riyals. In other words, when the cost of treatment during one year exceeds this amount, the company should pay the extra amount even if it agreed to pay a deductible. For example, the company agreed to pay 100 riyals monthly per person; namely 1200 riyals annually. Taking the risks into account, the maximum amount of 10,000 riyals is set for the person as a deposit to the hospital which is entitled to ask the company to pay any extra. Secondly: Forsaking this system may lead to the following negative consequences:1- The companies that do not pay the costs for their employees' treatment on a monthly basis may be exposed to unexpected procedures. (Part No. 15; Page No. 319) 2- They should undertake the expenses and management of controlling manipulation and faking illness on the part of the workers.3- They should bear the costs of auditing the hospital bills so that a company may recognize manipulative practices regarding medicine bills, unjustified prices of drugs, unnecessary remedies, and the like to increase profits, which is a widespread occurrence (Allah is the One sought for help).4- Removing the burden of assigning one or more auditors at the expense of the company to review the hospital bills. Thus, the hospital tries to minimize the cost of treatment in a way that does not harm the patient in order to gain more. Because of these points the company purposefully concludes the agreement in the form mentioned above. This method is beneficial for the company which would not be able to achieve this if it dealt with bills, due to its lack of experience in this field (the company knows that this method is used by the hospitals). Although most of the hospitals and clinics use this method, we reject it to adhere to the Islamic methods. As a result, many companies avoid dealing with our hospital. Kindly be informed that this system of health insurance is the same that is studied by the cabinet and the consultative council, and is used by the companies of (Part No. 15; Page No. 320) the cooperative medical insurance found throughout the Kingdom of Saudi Arabia. Please tell us the ruling on this issue.