Health is becoming a rising concern in Mexico with 33% of the population being obese. This results in an increased prevalence of chronic diseases such as heart conditions and diabetes, and it is estimated that obesity-related diseases cost the government approximately US$3.5 billion annually. A person with diabetes spends approximately a third of their income in medical costs in Mexico. As part of the Seguro Popular program for Mexican citizens who cannot afford private healthcare, there is access to treatment for chronic obesity related diseases at the Diabetes and Obesity Clinic in the Hospital de Especialidades of the Centro Medical Nacional Siglo XXI. However, caring for the overwhelmingly ill population is a massive strain for government resources, especially as the number of people living with diabetes is expected to increase by 175% to 11.9 million patients by 2030, according to a report published by CENETEC. As the government struggles to cope with demand, a private healthcare market is emerging, targeted at those living with chronic diseases like diabetes.
Typically, after diagnosis with a chronic disease, it is difficult to find comprehensive, affordable healthcare due to the continual need for expensive medical procedures and medication, as well as the predisposition to developing further chronodegenerative health issues. In 2012 AXA Seguros launched the first health insurance package in Mexico designed especially for those with diabetes. The benefits of the package are two-fold: not only is it designed as a life insurance policy, but it also helps to cover lifelong health costs. Moreover, if the patient’s condition is declared terminal, they can expect to receive a payout of 30% of the value of the policy. The cost of the insurance fluctuates depending on the type, age and personal circumstances of the patient. However someone of the age of 40 would generally expect to pay MX$1,000 per month. A man aged between 35 and 40 years old can receive a guaranteed payout of MX$1 million with a policy costing MX$900 per month, depending on other factors.
GNP Seguros offers the program GNP Cuida tu Salud to generate positive changes in general health by evaluating the risk for developing several diseases and providing recommendations to promote a healthy lifestyle. It targets six chronic and degenerative diseases such as diabetes, obesity, dyslipidemia, hypertension, breast cancer, and prostate cancer, and covers 15,000 employees at 10 different companies. A study conducted among 2,000 people participating in the program showed it reduced the risk of hypertension by 21%, diabetes 26.3%, breast cancer 22.41%, prostate cancer 44.67%, dyslipidemia 9.63%, and metabolic syndrome 4.68%. Additionally, BBVA Bancomer offers a popular health insurance package designed for those with cancer called RespaldoSeguro Contra Cancer. If a patient holds this product, the policy will pay out upon receiving a cancer diagnosis. The product is currently owned by around 50,000 people and the price starts at MXN$150 per month depending on individual circumstances. The policy is paid to the beneficiaries upon death of the holder. Seguros Monterrey New York Life (SMNYL) has sold 2.9 million of their Afronta policy, which is designed to be taken out after diagnosis with a chronic or terminal disease such as Parkinson’s disease, multiple sclerosis and cancer. The policy works in a similar way to BBVA Bancomer’s RespaldoSalud cover and contains an identical 180 day cooling off period.
It is a welcome development, given the strain that diseases like diabetes put on the government-funded Seguro Popular program. It is also a wide market since it is estimated that ten million Mexican citizens have diabetes. But is it an effective business model for companies to offer such a service to chronic patients? The answer is that the insurance policies have extremely strict requirements for payouts. With the BBVA Bancomer RespaldoSeguro for example, if the policy remains in place for 90 days or less, there is no payout. If redeemed between 91 to 180 days, 75% of the value of the policy is paid and after 181 days the beneficiary can expect to receive the full value of the policy. There are certain exclusions for payment, such as contraction of skin cancer and melanoma, cancer related to AIDS or HIV and lung cancer as a consequence of smoke inhalation, among others.
The question of treatment over prevention is still a massive issue for the Mexican government. Currently, public spending on treatment of illnesses is 11 times greater than that of education aimed at prevention. The government seems to be making an attempt at damage control rather than preventing initial contraction of chronic diseases. The private health insurances offered by companies such as AXA and BBVA Bancomer may help to alleviate some of the strain on the Seguro Popular system so that the government can redirect funds to education campaigns to mitigate the need for such insurance products.
It is clear that the healthcare industry in Mexico is expanding at a great rate, becoming savvy enough to target all demographics, even those which may not typically seem financially viable. This demonstrates increasing competition in the Mexican healthcare market, in that companies are starting to develop more innovative products.
This is an excerpt of an article published in Mexico Health Review 2015. For more information about the 2015 and 2016 editions please visit http://mexicohealthreview.com
If you liked this post you might also like: