Claims pain in Spain
More and more travellers in Spain are encountering problems when claiming for medical treatment under the EHIC. Jose Afonso examines the problem
First published in ITIJ 114, July 2010
More and more travellers in Spain are encountering problems when claiming for medical treatment under the EHIC. Jose Afonso examines the problem
In 2005 the European Union (EU) introduced the European Health Insurance Card (EHIC) for EU citizens to prove their entitlement to receive free or reduced-cost emergency medical treatment during stays in other EU countries on the same basis as local residents. Only a few EU countries actually pay the full cost of medical treatment and so sufficient travel insurance is always required to supplement the EHIC. In any event, under the reciprocal and bilateral agreements that all EU countries signed up to, citizens of the European Economic Area should still expect to be treated on the same terms as insured nationals of the country they’re visiting. While most countries are honouring the agreement, there is one notable exception however – Spain. This is a serious cause for concern in the travel insurance and assistance sector as the industry heads into the peak summer period.
According to the Spanish Institute of Tourist Studies (IET), Brits make around 17 million trips to Spain every year and account for about 30 per cent of all visitors to the country. Spain is the number one destination for British holidaymakers, yet it is now almost impossible to get an EHIC accepted in the country, including in the Balearics and the Canaries. This is particularly true in the areas of highest tourism, where public hospitals are simply bypassing the EHIC altogether.
Assistance companies are seeing more and more Spanish national health hospitals refusing to treat European visitors under the EHIC and billing their travel insurers as if the patients are private – that’s not fair to policyholders or the insurance community. Certainly, faced with rising claims costs in Spain, sustaining competitive pricing will become more and more of a challenge across the whole of the industry. Even if a patient obtained a EHIC before travelling, if they are unfortunate enough not to have it on them at the time they are admitted to hospital, the Spanish national health service is now ignoring the EHIC altogether and is registering EU patients as private or self-payers. It then refuses to accept any official certification that replaces the EHIC – even though we can usually provide it within an hour – using a piece of legislation that they feel vindicates their decision.
More importantly, even if a patient is in possession of the EHIC, if the public hospital knows there is an insurance policy in vigour that could cover medical expenses, it automatically refuses to treat the patient as public. I hazard a guess, but perhaps this is because when the UK pays Spain back for treating a British citizen the money ends up in Madrid and the treating hospital never sees it.
Spain is the number one destination for British holidaymakers, yet it is now almost impossible to get an EHIC accepted in the country
It seems that these hospitals’ refusal to treat European visitors under the EHIC is down to their interpretation of Article 83 [and its subsequent versions] of Spanish General Law on Health and Articles 127.3 and 126.3 of Spanish General Law pertaining to Social Services, which they see as ‘forcing’ them to claim the cost of treating any patient, including if they are Spanish, from any third-party insurer that covers health. These hospitals have apparently gone as far as establishing direct links with the Spanish Ministry of Economy who will, it seems, act as debt collectors on the government’s behalf with the apparent right to extract funds directly from the insurance company’s bank accounts.
What these hospitals seem to be conveniently overlooking, however, is that the point of law concerns obligatory insurances that a Spanish person should have, such as motor insurance and liability cover for accidents at work for example. Travel insurance is not compulsory for Spanish residents or visitors from within the EU, therefore this point of law should not apply.
British Members of the European Parliament (MEPs) for Health are aware of the issue but do not intend to tell the Spanish Government how it should run its Social Security affairs, therefore we at ONE Group welcome the decision of the British Medical Emergency Services Forum (BMESF) and the Travel Insurance Claims Committee (TICC) to employ the services of a legal expert to conduct a review of the situation this year, which we see as a very positive step. In the meantime, many BMESF members are already refusing to settle invoices believing first that the EHIC is the ‘third party’ referred to in the legislation; secondly that public hospitals do not have the right to choose who to bill (EHIC or insurers) and, thirdly, that it is unfair for insured patients to have to pay a policy excess for treatment in a European public hospital.
Conversely, one of the leading cost containment companies in Spain believes that it is clear that regardless of the EHIC, travel insurance companies must pay a public hospital when a claim is valid. In their opinion therefore, the challenge we and our competitors now face is actually to negotiate the prices we should pay for treatment instead of concentrating on the application of the European guidelines and local laws. BMESF members agree that future discussions about this should take place with British authorities as well as the hospitals concerned and with the involvement or backing of insurers and that in the meantime any concerted action will wait until the legal opinion is received. We certainly feel that the opinion of this cost containment company is perhaps simplistic and not any kind of solution to the problem. The way ONE Group sees it, when a European visitor receives treatment in a public hospital in a member state, that facility should claim its loss from the EHIC in the first instance, and only in the event that the EHIC will not cover, should they approach an alternative insurer. In addition to what we have already said about travel insurance not being obligatory, we think there are four other key areas that support this:
- Many travel insurance underwriters exclude cover where it already exists under a National Insurance scheme or Reciprocal or Bilateral Health Arrangement, therefore those travel insurance underwriters cannot be included in the hospital's list of third-party insurers ‘responsible’ for payment.
- Many travel insurance policies also exclude liability in respect of any claim where the event leading to the claim is insured by any other existing policy or policies. As the name European Health Insurance Card suggests, the rules and regulations that govern it must be stipulated in a contract between the underwriter and the holder and that contract must be thought of as a policy based on an offer and its acceptance, even if a premium has not been paid.
Many travel insurance policies have a ‘choice of law’ clause that stipulates that unless specifically agreed to the contrary, the policy shall be subject to English Law, therefore the stipulations of the law in Spain, and the rulings of Spanish courts, should not be taken as absolute in these matters. - The legal sequence of payment-responsibility in Spain is now the following:
- Third party obliged to pay
- Patient
- Reciprocal/Bilateral agreements relating to healthcare
ONE Group does not agree with this. We feel that as the UK Government effectively underwrites the EHIC, we cannot identify a legal justification for the Spanish hospitals to discount it as that 'Third party obliged to pay' [which their law refers to] under the obligations it signed up to when entering into a bilateral or reciprocal healthcare agreement with Spain.
In view of this, we welcome the TICC’s decision to employ a solicitor who specialises in international law to examine the matter in detail both in Spain and in the UK and make clear recommendations.
In the meantime, insurers should perhaps consider making their wordings more explicit.
faced with rising claims costs in Spain, sustaining competitive pricing will become more and more of a challenge across the whole of the industry
For example, although many travel insurance policies have a ‘Choice of Law’ clause stipulating that the contract of insurance is governed and therefore subject to English Law, policy writers must first give regard to, and accommodate for, other international laws.
This will ensure that the choice of law will be recognised in these other jurisdictions and not automatically struck down on the basis of implied overriding mandatory laws or public policy in countries like Spain.
Policy writers could also attach an exclusive and express endorsement about jurisdiction to the choice of law clause, which clearly stipulates that these contracts of insurance shall not only be governed by the law of England, the responsibility for arbitrating disputes also rests solely with the courts of England and Wales and that consequently any ruling by a court of the country where the loss occurs will have no bearing, especially because they could side with the national suppliers.
This would give assistance companies more grounds on which to dispute the hospital’s interpretation of the law. But for now at least, the EHIC will remain almost totally ineffective in many popular parts or Spain and the claims in Spain will remain an almighty pain.