How can British expats in the EU (either already there or those who want to move) plan for their health insurance after Brexit?
There are an estimated 1.3 million British citizens living in EU countries. By far the biggest community is in Spain with just under 310,000, followed by Ireland at 280,000 and France at 180,000.¹
So how will these expats ensure they have access to healthcare following Brexit?
Although we talk about the ‘EU’ as a single entity/market, from a healthcare point of view each member country has its own unique healthcare system in terms of delivery of care, how care is funded and how care is accessed. That is 28 (currently!) different systems. In addition, like in the UK, there are often regional variations and idiosyncrasies that make accessing care even more complicated. In most EU member countries healthcare is provided via both State funded and private facilities. In some cases, this means that social security (National Insurance) contributions fund the bulk of care costs but a balance of each treatment needs to be settled by the individual either through self-pay or via top-up insurance. In other systems, basic care is provided by the State but more involved and costly treatments have to be funded privately or insured.
These multiple systems mean that there won’t be just one solution to the “post-Brexit” health issue. Indeed, even with the current reciprocal arrangements how a specific individual accesses care and funds treatment will be based on several factors; the EU countries involved, their healthcare regulation, the individual’s residency/tax status, participation in the local system or via reciprocation, employment status and in some cases income levels.
For UK expats employed in the EU after Brexit, healthcare shouldn’t be particularly problematic and shouldn’t change from their current situation. If they are employed locally then they should already be complying with local social security and healthcare regulations that provide them with access to the local healthcare systems. Depending on their situation and location, they may have supplementary health insurance to provide additional options, including treatment in other countries or back in the UK.
The big issues arise for UK expats who aren’t employed in the EU. Considerable numbers of UK nationals have used the freedom of movement to live in Europe either retired or semi-retired. There are an estimated 200,000 plus individuals in Spain alone!1. The freedom of movement allows these people to resided often without any formal status, in effect almost long-term visitors. This situation means that many of these individuals don’t pay into the local system but rely on reciprocal arrangements using either EHIC or S1 forms that provides them with access to treatment locally with the costs being borne by the UK’s NHS.
Even at this late stage there is no clarity on exactly what will happen post-Brexit. UK and EU Governments have confirmed that there won’t be mass, forced repatriations but there may be a requirement to “normalise” residency in the EU. This may force UK nationals to join the local social security system or, if that isn’t an option, arrange private insurance.The EHIC/S1 arrangements may no longer be valid in the EU and again, UK expats may be need to look at private health insurance.
For these individuals there are several significant issues:
- Cost: International PMI isn’t cheap especially for those of advancing years. If they haven’t budgeted for this additional cost from their income, then it could make a sizeable dent in their plans.
- Underwriting: Individual IPMI will be subject to underwriting, so pre-existing conditions will be excluded. Again, for those in advancing years, the lack of coverage in respect of pre-existing and, in some cases, chronic conditions could mean sizable additional healthcare costs.
- Suitability: There are hundreds of plans available. Finding the most suitable isn’t an easy task. Things to consider are:
- Benefit levels:
Will they meet needs now and in the future?
Local plans will cover treatment just in the host country. International plans will tend to cover worldwide ex US. However, there are some providers who will offer two-country coverage (UK and host country).
The plan might be affordable this year, but rates of international cover increase by 10% per year, plus there are age-related increases, so the cost can easily double in five years.
What should expats do?
- Don’t ignore the issue – it’s not going away. Hope for the best but plan for the worst.
- Do some research – find out the cost of cover and how you can budget for it. In addition, especially those with existing health issues find out the cost of treatment, check-ups and medication so you can budget for additional costs.
- Don’t rely on the NHS – in the past many expats have travelled back to the UK for treatment. Systems are being tightened so that expats who are resident in the UK, paying tax/NI won’t be able to access NHS facilities without paying for the treatment.
- Take advice – there are a number of specialist brokers who can help you.
quoting UN figures 2017