On 30 May 2018 the Kingdom of Bahrain ("Bahrain") passed Law No. 23 of 2018 promulgating the Health Insurance Law (the "Law"). The Law came into force on 1 December 2018. Prior to the Law, there was no standalone health insurance law as health insurance was governed by a number of different laws overseen by the Ministry of Health.

Application

The Law applies to all nationals, residents and visitors (the "Beneficiaries") subject to certain limited exceptions. These exceptions include: civilian and military personnel of the Bahrain Defence Force (the "BDF") and their families; hospitals and medical facilities affiliated with the BDF; and foreigners associated with diplomatic and related missions in Bahrain.

Objectives

The Law has been designed to provide a consolidated and high-quality health system that is flexible and responsive to the aspirations of the Beneficiaries. It will provide individuals with greater choice of governmental or non-governmental health service providers (together, "Providers"), while creating a fairer and more competitive economic environment under which Providers are able to operate. It is intended that these objectives will be facilitated by the National Health Regulatory Authority (the "NHRA"). The NHRA's remit will include coordinating with the Supreme Council of Health (the "Council") in establishing a dedicated health insurance fund (the "Fund") whose proceeds will be invested in order to finance the health system. The Fund will be run by an elected Board of Directors and will be used to generate income and administer it to achieve the on-going financial stability and sustainability of the health system.

The Fund

The Fund will contract with Providers to establish rules facilitating the collection of insurance contributions from Beneficiaries, which will be payable to the Fund.

The Law requires the Fund to organize educational and training initiatives relating to the health insurance system, and to opine on relevant draft laws and regulations in conjunction with the Council. The Fund will also analyse the impact of existing laws on the system with a view to considering the best way to mitigate or enhance their effects.

Further to its receipt of health insurance contributions and fees, the Fund will be allowed limited financing from revenues collected for any services rendered by the Fund.

Health Information and Knowledge Management Centre

Under the Law, a Health Information and Knowledge Management Centre (the "Centre") will be established and will be responsible for the collection, analysis and processing of Beneficiaries' health-related data, plus statistics concerning Beneficiaries, the Fund, insurers licensed under the Law and Providers.

The Centre will have access to a centralized system recording comprehensive electronic medical records for all Beneficiaries. This will be the sole repository for Beneficiaries' health-related data. Such data will be used to assess the validity of the claims made by Beneficiaries under the Law.

Mandatory and voluntary health insurance

The Law requires mandatory health insurance for everyone subject to the Law. This is to be achieved through payment of insurance contributions into the Fund, which will provide insurance coverage through a mechanism where insurers licensed under the Law pay Beneficiaries' valid claims. The Law also specifies benefits and services provided to Beneficiaries through their coverage by the Fund pursuant to the introduction of mandatory health insurance.

Under the Law, employers are now obliged to pay contributions to facilitate insurance coverage for their foreign employees. Depending on the terms of these employees' employment contracts, the employers may also be obliged to pay contributions on behalf of these employees' dependents so that they are also protected by mandatory health insurance under the terms of the Law.

In addition, Bahraini nationals are able to access voluntary health insurance packages through the Fund. Those who choose private sector hospitals or facilities will have to pay a maximum of 40% of the cost, with the government subsidizing the remaining balance. Foreign visitors to the country will also be covered for emergency healthcare, although the cost of visas will increase as a result.

Penalties

Breaches of the Law may result in the offender incurring a combination of civil and criminal penalties, including fines of up to Bahraini Dinars Fifty Thousand (BHD 50,000).

Conclusion

The creation of a new health insurance law complements other laws which have been recently passed in Bahrain with a view to developing its legislative structures and boosting its economy. The Law has received a generally positive response in view of its progressive objectives and comprehensive provisions. Among those who will benefit are foreign employees registered as domestic workers. News reports suggest more than 100,000 workers will have access to the same health privileges as Bahraini nationals at no extra cost to their employers. The Law also seeks to ensure that there are incentives for Bahraini nationals to register with non-governmental health service providers. It is projected that this will result in enhanced competition in the private health sector and encourage Providers across both the private and public health sectors to adopt high standards.