Chate Jaikunya
An Educational Partnership
Between
Faculty of the Massachusetts Institute of Technology
and the Chulabhorn Research Institute
Course: Bioengineering and Environmental Health
Health Insurance in Thailand
By: Chate Jaikunya
ID: ttb007082
Field of study: Environmental Toxicology, Technology and Management
Student from The inter-university program between Asian Institute of
Technology, Chulabhorn Research Institute, and Mahidol University.
Course Instructor:
Dr. Maria Kartalou (MIT)
July 19, 2000
Page 1 of 15
Chate Jaikunya
Contents
Page
1. Introduction
3
2. Health care systems in Thailand
2.1 Public system
2.2 Private system
3
3
5
3. Life Insurance Schemes
3.1 Introduction
3.2 Life insurance
3.3 The approach of most insurance companies
3.4 HIV test
3.5 Occupational restriction
3.6 Exclusion clauses
3.7 Discussion
6
6
6
7
7
8
8
8
4. Social Security
4.1 Introduction
4.2 Social Security in Thailand
4.3 The responsibility for AIDS/HIV patients
4.4 Discussion
10
10
10
12
12
5. Other systems
5.1 Health Card Fund
5.2 Public Welfare
5.3 The Government workers
13
13
13
13
6. Conclusion
14
Reference
15
July 19, 2000
Page 2 of 15
Chate Jaikunya
Health Insurance Systems in Thailand
1. Introduction
During the past two decades, the human immunodeficiency virus (HIV) that causes
acquired immune deficiency syndrome (AIDS) has been introduced into the
populations of many countries in both the developed and the developing world.
Because of the long period between the time of HIV infection and the onset of AIDS
symptoms, most individuals who carry the HIV are unaware that they are infected
and, more important, that they may be infecting other through unprotected sex, blood
donations, reused needles, and so on.
Beyond the total costs of AIDS, the distribution of those costs is of considerable
significance. Those who potentially bear the cost of AIDS are:
(a) individuals who develop AIDS and their families and friends,
(b) employers of individuals with AIDS,
(c) health and life insurance companies,
(d) health providers,
(e) users of the health care system who do not have AIDS,
(f) taxpayers,
(g) international agencies and charitable organizations
In Thailand, the AIDS epidemic is contributing to increased economic inequality
because it is disproportionately affecting low-income groups, and public and private
institutions that could spread the costs of the epidemic (for example, health, life,
disability, and social welfare insurance) are relatively limited and do not reach the
majority of the population.
In addition the high cost of AIDS/HIV drug are the second problem for the AIDS/HIV
patients, contrarily to the increasing of epidemic in low-income people. Then, to study
the system that can bear the cost of AIDS/HIV drug for the patient in Thailand should
be an important thing.
2. Health-care systems in Thailand
The population in Thailand, similarly to other countries, has an opportunity to make a
decision paying their own treatment in the various types of health-care organization.
In general, these can divide into two main types: public and private system. The
objectives of divided system are to offer the best health-care system to Thais based on
the difference desired by the people. Each of the two systems will try to offer the best
health-care criteria that concern mainly the Thai people.
2.1 Public system
Hospital
There are two types of public hospitals in Thailand administered by the Ministry of
Public Health: provincial and district hospitals. Provincial hospitals provide more
advanced medical care than do district hospitals. All public hospitals charge user fees
with low price.
July 19, 2000
Page 3 of 15
Chate Jaikunya
Health centers
Commune health centers are operated by the Ministry of Public Health and provide
primary health care services to rural populations. In general, individuals tend to use
private drug stores more frequently and consult private physicians rather than health
centers.
Village drug cooperatives
These cooperatives are operated by the Ministry of Public Health to provide rural
populations with drugs to public health center structure. They are run by village health
volunteers and village health communicators working for the ministry. The
cooperatives are funded through private contributions of approximately 50 baht (~1$)
per family.
Health Card Fund
This is an insurance scheme that provides up to four members of each enrolled family
with free care at the health centers six times per year and a 10 percent discount at the
village drug cooperative. Enrollment costs 500 baht (~10$) per year.
2.2 Private system
Physicians
Only 10 percent of Thailand's physicians work in private practice full time. The
remaining 90 percent work for the Ministry of Public Health and most also work in
private practice. The urban poor and rural populations receive little private physician
care.
Hospitals
There are 989 hospitals in Thailand, and approximately 25 percent are privately run.
Of all private hospitals, one-third is nonprofit and two-thirds are for profit. Private
hospitals provide relatively high quality services to patients in terms of staffing, room
conditions, and medical care.
Insurance schemes
A number of insurance schemes exist for public and private employees. Government
employees are entitled to free medical care at facilities operated by the government.
Private companies often offer their own medical services to employees or contract
with public and private health facilities to serve their employees. Firms having more
than 500 employees are required to provide a physician on call to their employees.
Social security system
As of March 1991, the Thai government launched a social security system to provide
health care for employees. Enterprises with twenty or more workers are covered. In
the next few years, social security coverage will be extended to include smaller
enterprises. This system funded by the government and by a 2- percent wage
deduction from employers and from employees. As of 1991, 3 million people were
covered but recently, on 1998, covering 5.2 million people.
Free Medical Care Project
This insurance scheme provides free services to the pooper population who have a
gain income lower than 'poverty line': individuals earning less than 1,650 baht
July 19, 2000
Page 4 of 15
Chate Jaikunya
(US$66) per month and families earning less than 2,175 baht (US$87) per month are
covered. As of 1985, there were 11 million members.
Recently, in Thailand have only 2 health-care systems that can possibly provide drugs
that have a high cost as AIDS/HIV drug. There are: insurance schemes, and social
security. These systems will be discussed through the detail in their topic.
(This information comes from a person, who works for National AIDS control division, Ministry of
Public Health)
July 19, 2000
Page 5 of 15
Chate Jaikunya
3. Life Insurance Schemes
3.1 Introduction
Life insurance schemes or life insurance industry is a system whereby a group of
individuals form a group to share the risks due to death, disability, illness, and loss of
income during old age. They pay the prescribed premiums and are entitled to receive
a certain amount of money to alleviate their predicament and compensate for their
loss of income. A life insurance company serves as the intermediary that coordinate
the benefits from the common pool of money. Thus, insuring one's life is comparable
to insuring one's ability to earn income.
Types of insurance:
There are two main types of insurance:
(1) Indemnity insurance is when the insurance company agrees to compensate the
insured for loss that the insured may suffer as a result of the event the insured
have insured themselves against, e.g. insuring household property against theft or
fire. Example if the insured are involved in a car accident and the vehicle can
only be repaired at a cost of that the insurer agreed to.
(2) Non-indemnity insurance is a type of insurance where the insured and insurer
agree on the amount that the insurance company will pay if something happens to
the insured. The higher amount that the company pay will be correlated with the
higher the premium that the insured pay. Disability insurance is an example of
non-indemnity insurance. Here an insured person is paid a fixed amount of
money if he/she becomes incapacitated and can no longer work. The amount is
agreed on at the time the contract is made. In addition, life insurance is the best
example of non-indemnity insurance - also called 'life assurance'.
3.2 Life insurance
Life insurance or life assurance can describe easily by this example, if a person's life
is insured for 700,000 baht, this amount will be paid to the beneficiaries (family of
friend's chosen by the insured) if that person dies. A person who has insured his/her
life will always die, but what is uncertain is when, the longer the insured live, the
greater the amount of money the insured pay, and the more the company can profit
from investments that it makes with the money.
But if a person takes out life insurance today and dies tomorrow, and the insurance
company has agreed to pay, then the insurer will lose money. Then, the insurance
companies try to calculate the risk that each individual presents to the company. For
example, it is assumed that older people, or people who smoke, will be more likely to
die. As a result, they pay higher premiums.
This type of health-care system should be the one that has a high potential paying the
AIDS/HIV drug cost for the person who can still hold on the insurance, the insured.
But as the previous section, the insurer will force the candidate insured to pay the
higher premium, may be highest than other diseases or conditions. At present, there
are over 6 million life insurance policyholders in Thailand and furthermore, this
system has a tendency increasing the insurance holder in the future.
July 19, 2000
Page 6 of 15
Chate Jaikunya
3.3 The approach of most insurance companies
Many insurance companies say:
 that the problem posed by people with HIV is that they will die or be-disabled
prematurely (earlier than normally expected);
 that the risk of insuring a person with HIV is too great, and that insuring too many
people with HIV will force the schemes to increase the cost of insurance for
everyone else;
 that under the INSURANCE ACT, they have a right to try and measure the risk
posed by each person who applies for insurance, and this includes testing a person
for HIV.
For this reason, most insurance companies refuse to give people with HIV either life
or disability insurance. They do this by:
 asking a person to have an HIV test before an insurance contract is agreed to, and
 putting clauses into contracts that exclude liability (legal responsibility) or limit
the amount they will pay out if a person dies of AIDS (called 'exclusion clauses').
Then, all of insurance companies in Thailand cannot offer policies for people with
HIV but if they can, they will charge very high premiums, and will also limit the
amount that a person's life can be insured for.
3.4 HIV tests
When a person wants life or disability insurance, the company will usually demand
that the people have an HIV test. If somebody refuse to have an HIV test, the policy
might be turned down.
This is the procedure that is followed by most insurance companies:
(a) An application form is completed by the insured directly. This form will probably
include a consent form for an HIV test. Signing this consent form without
receiving proper counseling does not meet the requirements of informed consent.
(b) The insured will be asked to give details of the personal doctor (family doctor or a
doctor who can trust). The results of the HIV test will be sent to this doctor, so it
is important that his/her details are correctly written down.
(c) An HIV test will be done by a doctor or laboratory chosen by the insurance
company.
(d) The result of the HIV test is then sent to a doctor employed in the Insurance
Company. This person is usually called the 'chief medical officer'.
(e) The chief medical officer will open a file for the insured. The file will include all
medical information relevant to the application, including the results of HIV test.
(f) If a test result is positive, the application is immediately rejected. The name will
be put in code on the Life Register as someone who has been refused insurance.
This means that if this person apply for insurance to another company, they will
also reject this application.
(g) If the result is positive, the doctor will be told in writing. This doctor is expected
to contact the people to tell them the result. An insurance company will not tell
directly. The doctor is not informed if the results are negative.
(h) If the results are negative, and all the other conditions of the insurance company
are satisfied, they will be told that this application for insurance has been
successful.
July 19, 2000
Page 7 of 15
Chate Jaikunya
3.5 Occupational restriction
Before the companies give the insurance to the insured, in general, the company has
two processes for screening the qualified people. First, the candidate insured was
screened by a person who sells insurance or also called "the broker". The second
screening will be handle by the company's committee (in this committee usually
included with doctor, chief medical officer, or nurse).
For the screening by the broker, each company commonly set up the criteria to screen
the HIV/AIDS person for the broker. Not only the candidate insured who required
insurance higher than 700,000 baht, but also the candidate insured who doing the
following occupations, request by insurance company for HIV test.
 The male hairdresser
 The male modeling
 The male/female singer
 The actor/actress
 The male designer
 Guidance for travelling
 Homosexual
 The people who have experience with habit-forming drug
 The people who have experience with venereal disease
 The people who were denied for blood donation
 The male/female prostitute
3.6 Exclusion clauses
Some company plans to offer the policy to AIDS/HIV people in the future but these
people should accept the 'exclusion clauses' of company. Clauses in an insurance
policy, which state that the insurance company will not pay out under certain
circumstances, are called "exclusion clauses". It also means that a clause which says
that the insurance company dose not need to pay if the insured commits suicide or
dies of AIDS.
There are different types of exclusion clauses:
 Some clauses say the company will not pay if the insured has HIV or AIDS at the
time of death. But a person who has HIV will not necessarily die of an AIDSrelated condition, e.g. he/she could be killed in a car accident.
 Some exclusion clauses say that the insurance company will not pay out if the
company decides that the insured has died or become disabled because of HIV or
AIDS. This allows the insurance company to decide what the cause of death or
disability is on its own. For example, if somebody with HIV dies of pneumonia
and the insurance company decides that it would be recovered if they were not
HIV positive, it might use this to avoid paying out.
 Some clauses say that the insurance company will not pay out if the insured dies
of AIDS, or an AIDS- or HIV-related condition.
 It is very important to read the conditions of the policy carefully before entering
into an insurance contract-look out especially for exclusion clauses.
3.7 Discussion
The people who can get this type of health insurance should be the rich people, but
Thailand still is the developing country and so many Thais are the poor people - have
July 19, 2000
Page 8 of 15
Chate Jaikunya
a low income. In opposite way, the insurance companies set up the variety of criteria
or specific criteria and offer the high premium prize for the AIDS/HIV people as
mention previously. Then it is not easily to access this system for effort payment to
AIDS/HIV drugs.
July 19, 2000
Page 9 of 15
Chate Jaikunya
4. Social Security
4.1 Introduction
Social security can be conventionally defined as: "the protection which society
provides for its members, through a series of public measures, against the economic
and social distress that otherwise would be caused by the stoppage or substantial
reduction of earnings resulting from sickness, maternity, employment injury,
unemployment, invalidity, old age and death; the provision of medical care; and the
provision of subsidies for families with children".
The ILO Convention No. 102: Social Security (Minimum Standards), 1952, identifies
nine main branches of social security covering most if not all the principal
contingencies faced by workers and their families during the course of their lives:
medical care, sickness benefit, unemployment benefit, old-age benefit, employment
injury benefit, maternity benefit, invalidity benefit, family benefit and survivors'
benefit.
4.2 Social Security in Thailand
Social Security is the nation’s largest government program. It provides retirement
income, and disability and survivor benefits, to 5.2 million Thais. The program is
financed by payroll taxes, which are second only to the individual income tax as
source of federal revenue. A workers pay for this system through their taxes system,
2% of their salary. Employers also pay by matching workers taxes, 2% of each their
employees salaries. In addition, the government also pays by matching with workers'
and employers' payment, 2% of each workers salary the same amount as employers'
payment.
Social Security taxes go to the Social Security trust funds, Social Security Office of
Thailand. The money is used for three purposes: (1) to pay for current benefits, (2) for
administrative costs; and (3) the rest is invested in Treasury Ministry bonds and earns
interest to pay future benefits. By law, the Treasury Ministry bonds can be recovered
at same amount whenever they are needed to pay benefits. These Social Security trust
funds were managed by a Board of Trustees. It is made up of three cabinet Secretaries
(of Treasury, Labor, and Health and Human Services) The committee will report each
year on: (1) what happened to the funds last year; (2) short-range projections of the
funds for the next 10 years; and (3) long-range projections of the next 75 years.
The Social Security Scheme in Thailand play a role based on the Social Security Act,
1990. The characteristics of the person who should enroll to the Social Security are
(1) the one who starting to work, (2) >15 years old and <60 years old workers, and (3)
the establishments that have upper to 10 persons of amount of workers. The
establishment or the employer must be handling the responsibility to enroll the Social
Security system for their worker.
July 19, 2000
Page 10 of 15
Chate Jaikunya
Number of Establishments by Area: 1998
93,093 places
Bangkok Metropolis
40%
Region
60%
Sources: Registration Division, Social Security Office
Number of Insured Persons by Area: 1998
Total 5.42 Million persons
Bangkok
Metropolis
35%
Region
65%
Sources: Registration Division, Social Security Office
In Thailand can divided the Social Security Scheme into 6 types. There are:
(1) Sickness insurance
(2) Maternity insurance
(3) Accident and occupational diseases insurance
(4) Disability or invalidity insurance
(5) Retirement insurance
July 19, 2000
Page 11 of 15
Chate Jaikunya
(6) Death and funeral insurance
Service Utilization of Insured persons: 1998
0.14%
Death
Invalidity
0.0058%
Maternity
1.96%
97.9%
Sickness
0
20
40
60
80
Percent
100
Source: Technical Studies and Planning Division, Social Security Office
4.3 The responsibility for AIDS/HIV patient
From the previous figure demonstrated a highest amount of money that the Social
Security will pay for sickness and also the cost of AIDS/HIVS treatment included
certainly in this payment. The Social Security Office of Thailand not yet builds up the
specific criteria treatment for the AIDS/HIV people. The criteria treatments as come
from the regulation of Social Security Act 1990 specify render the treatment cost for
(1) the general treatment that correlate with the symptoms, (2) the cost of drug that
was prescribed by the doctor base on the National Drug List (AIDS/HIV drug: AZT,
ddI, and ddC).
4.4 Discussion
This type of health insurance was managed based on the criteria recommended by
regulation of law. Then, it is easy for covering the AIDS/HIV drug cost. This system
can cover only the worker who works in the industry, about 5.2 million Thais, but the
majority of Thais are the agriculturist.
July 19, 2000
Page 12 of 15
Chate Jaikunya
5. Other system
In Thailand, there are so many systems that are responsible for health insurance. This
chapter will describe in details for some of these systems. Beside that this chapter will
describe about another system or fund or project that responsible for AIDS/HIV
treatment.
5.1 Health Card Fund
Health card fund was handled by the Ministry of Public Health. This system has the
objective projecting to the populations who have an income higher than the 'poverty
line' and have not obtained the health insurance yet i.e. the agriculturist in the
countryside, the worker in the small factories that are not covered in the social
security system, the migrant workers, and the individual or independent careers. The
Ministry of Public Health would like to provide the health care system to these
people.
On May 4, 1993, a health card scheme was launched to Thai people and the one who
satisfied the criteria would be pay 500 baht for receiving the health card. This card
can provide: (1) the treatment cost for one year, no limitation times (2) used in all of
the public hospitals in Thailand, which are administered by the Ministry of Public
Health, (3) privilege to 5 persons in family for one card, if this family has more than 5
members, then they need more than one card. The government will pay 500 baht for
adding this card.
The population in this system will receive a broad medical care, it covers all of the
basic essential package but dose not cover the advanced treatment such as operation
and also AIDS/HIV drug. Because this system has an unstable finance system due to a
less limitation for accessing - lead to so many people and so many kinds of people can
access this system. Hence it cannot provide coverage for the advanced treatments.
5.2 Public Welfare
Public welfare was established based on assistance principle and welfare principle.
This system provides for (1) the populations who have an income lower than 'poverty
line', (2) disabilities people, and (3) the people <12 and >60 years. The people will
receive full aid treatment whenever they get the sickness and the public hospital will
take this responsibility.
The government of Thailand will be responsible for the whole cost of treatment. In
case of the people in this system that have HIV positive or AIDS, the government
usually tries to bring them to the AIDS fund such as the AIDS/HIV infant fund.
5.3 The Government workers
The people who work for the government agency will receive the health insurance by
the government. In each year, the government will set up the budget for these people.
This system does not covering only the worker, but also cover to the family of
worker.
The treatment cost that can be provided by this system that would cover the whole
cost of the treatment and the government worker should be receive the treatment from
only the public hospitals. The drug types that the doctor can give to these people
should be included in the National Drug List (AIDS/HIV: AZT, ddI, and ddC) only.
July 19, 2000
Page 13 of 15
Chate Jaikunya
6. Conclusion
In Thailand, health insurance operates both a public and private systems. Highincome groups and urban populations tend to rely on the private health insurance
system. More over, the private system charges user fees that generally cover the full
cost of medical care such as life insurance company and social security system. Then,
in Thailand will tend to concentrate the personal medical care costs associated with
AIDS upon the individuals living with AIDS and their families. In addition the life
insurance company and social security system have a high payment for AIDS/HIV
drug because the people in these systems have a stable income and high enough for
paying the drug prize.
Nowadays, the real situation of AIDS/HIV treatment in Thailand relies on the amount
of drug that imported from the outside. Several health insurance systems in Thailand
cite to use drugs as list of drug in the National Drug List, which include 3 types of
AIDS/HIV drug: AZT, ddI, and ddC. But both of public and private hospitals do not
have enough these drugs for providing treatment. The reason is due to the high cost of
AIDS/HIV drug. That lead to the government paying more budgets to import these
drugs and the government also has a high risk the refusal of the population. Moreover
these drugs cannot quite completely treat this disease.
July 19, 2000
Page 14 of 15
Chate Jaikunya
Reference:
David E. Bloom and Joyce V. Lyons; Economic Implications of AIDS in Asia; United
Nations Development Programme, Regional Programme Division, Regional Bureau
for Asia and the Pacific HIV/AIDS regional Project, New Delhi, India - 1993.
DC Jayasuriya; HIV Law, Ethics and Human rights - test and material; UNDP
Regional Project on HIV and Development, New Delhi - 1995
Marthha Ainsworth, Lieve Fransen, and Mead Over; Confronting AIIDS: Evidence
from the Developing world, European Commission; Brussels, Belgium and the World
Bank Washington, D.C., USA - 1998
Social Security Office; the Conceptual and the Principle of Social Security; the
Department Journal, ISBN 974-7873-50-8 - 1997 (Thai Language)
Social Security Office; Social Security System and Public Welfare System; the
Department Journal, ISBN 974-7873-51-6 -1997 (Thai Language)
The Office of Health Insurance; the Office of Health Insurance Annual Report - 19941998. (Thai Language)
http://aids.cdc.moph.go.th --- the National AIDS control Division website, Ministry of
Public Health.
http://www.tlaa.org --- Thai Life Assurance Association website.
http://www.ilo.org --- International Labour Organization website.
July 19, 2000
Page 15 of 15