Medical Insurance "Full Compensation" May Not Cover Everything!

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Medical insurance promotions often claim "full reimbursement"? Why might you still not be able to make a successful claim? Although medical insurance products with "full reimbursement" do not set compensation limits for each medical item, whether a claim is paid or not depends on whether it meets the two key principles of being "medically necessary" and "reasonable and customary". The Consumer Council* recently published a research report highlighting significant differences in how various insurance companies define "medically necessary". If you want to feel "at ease" using medical insurance for treatment in private hospitals, make sure to take note!

"Medically Necessary" requires that the insured’s hospitalisation and medical services conform to general medical practices and are appropriate for the diagnosis and treatment of the condition. If the insured is hospitalised purely for convenience or comfort rather than for treatment, it does not qualify as "medically necessary", and the insurance company may refuse to pay. To understand the definitions used by different insurance companies, you can refer to this article. In the past, there have been disputes over whether the insurance company or the insured’s doctor should determine what is "medically necessary". Currently, the Voluntary Health Insurance Scheme, which is of public concern, also addresses the definition of "medically necessary", repeatedly stating that hospitalisation and medical services must be based on the careful professional judgement of a registered doctor.

As for "Reasonable and Customary", this means that the costs related to hospitalisation and treatment must be "reasonable and customary" and not exceed the usual fee levels for such medical services in the local area. The purpose of this clause is to prevent the potential risk of overcharging for medical fees, which is particularly important for "all-inclusive" high-end medical insurance plans. However, what constitutes a customary fee level is not clearly defined in the "reasonable and customary" clauses of high-end medical insurance plans; for example, the cost of a colonoscopy is not specified. In contrast, mass-market medical insurance plans set specific compensation limits for each procedure and item.

Related link to the Consumer Council report coverage: http://bit.ly/2WOp0eX

This English version of this article has been generated by machine translation powered by AI. It is provided solely for reference purposes. In the event of any discrepancy or inconsistency between this translation and the original Chinese version, the Chinese version shall prevail.

Last updated: 9 Apr 2026

10Life Editorial Team

Our team of professional content researchers focussing on insurance

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10Life Editorial Team

Our team of professional content researchers focussing on insurance

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Medical insurance with "full reimbursement" may not cover everything!

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