Getting your money back from Viva Vida! (Global Health, Interglobal) if you are required to take Japanese National Health Insurance

This is the other raging debate, recently, now that the government is going to ask about (legitimate) health insurance coverage when you go to renew your Japanese visa.

On of the BBS posts (maybe at Debito’s?), someone mentioned that usually the ward office expects back-enrollment of two years for people who are doing the private-insurance scam. (This is not employer’s insurance through Shakai Hoken, but rather the “gap” insurers out there—the most noted three are in the title of the post.)

I have been thinking about this one, it’s very interesting.

On the one hand, some foreigners here say, credibly, that their ward office discouraged their initial enrollment in the National Health program. Or they said that the employer is supposed to take care of that (which usually is true, actually, but its own blog post).

And so, inevitably, the people have ended up buying that value priced gap insurer’s policy. Even though it’s not on the up-and-up with regard to being enrolled in real Japanese health insurance, it seems to pay the bills and therefore, they say, what’s the harm?

But the day the Japanese stop tolerating the shades of gray (remember: this is one of “Hoofin’s Laws”), now you are screwed. You thought you were saving big money by going with the gap insurer that sold to you over the internet. But like so many things over the internet, now you find that your money is gone and you have a big problem.

Now, I am not the Free Choice Foundation. I’m not a “lifer” gaikokujin like Ron Kessler, who can give you the story of this place all the way back to when disco and polyester were still popular in both Japan and America.

But I do know something about insurance. In insurance, there is something called “actuarial risk“. This is the risk, that the losses to the insurance company have been inaccurately measured. The math guys who work for insurance companies are called actuaries. They analyze where the insurance company has to pay out, and why, and then they figure what the insurance company has to charge over a broad enough population of insured people in order to pay any claims that arise. Plus, usually, make a profit.

Back in America, the states usually regulate the insurers. They try to make sure that the price charged is a fair one. Yes, that it covers the insurers’ actuarial (and other) risks, and allows for profit. But that the prices aren’t so extreme as really to be a big rip-off.

After all, we all aren’t actuaries, and we don’t have the database of claims. So how are we to know if the price is right?

So going back to gap insurers here in Japan:

Contrary to what Ron Kessler is suggesting, if you are resident in Japan you must be enrolled in either the health insurance part of shakai hoken, or in the national health insurance known as kokumin kenko hoken.

(Now, again, let me say this much: I am not a “foundation” telling you this. I am a guy sitting in my 1K. But maybe this is better than a guy having his picture taken from his apartment or business office and making believe it is the distinct office of a separate foundation. You can call me chairman if you like. I am sitting in one.)

Since enrolling in either the National Health Insurance or a regulated shakai hoken insurance is the rule, this can also be the assumption about any health insurance agreement in Japan. If a gap insurer is providing gap insurance (this is to cover the amount that the national program won’t pay), then the gap insurer arguably must price the policy as if the national government (or shakai hoken-related plan) is paying their share. Right??

If the gap insurer, like VivaVida! says they are pricing the policy on whether or not someone is enrolled in National Health Insurance, then they are maybe engaging in an anti-consumer transaction. Because, after all, we all know that residents in Japan are supposed to be enrolled in the national program or an equivalent.

So the part of the policy price that VivaVida! charges that would cover claims on charges that would otherwise be paid by National Health Insurance is really redundant. After all, everyone is covered by a government plan, or an employer plan regulated as comprehensive coverage by the government. Not as gap coverage.

So, again. As they say in the legal community, arguendo, someone buys gap insurer gap insurance. With a 2,000,000 yen coverage. They pay 58,500 yen a year. Sometime later, the local municipality in Japan catches up with them, and bills the prior two years. These were years that the gaikokujin resident thought he had covered (for gap at least) as a customer through the gap insurer.

What is to say that a customer doesn’t sue the gap insurer for overcharging on the gap insurance, under the consumer fraud or consumer protection acts in Japan?

These laws are very strong, as I see from articles written about refunds for rent charges, Eikaiwa tuitions, etc.

It does look like, in Japan, if a seller of a service is really overcharging and you can make a credible case that you have been fleeced, then you get your money back—at least the fleecing part.

So if gap insurance really should just cost 7,500 yen a year in the presence of National Health Insurance coverage (because most of the 2,000,000 yen “gap” will be picked up by the ward program), then the gap insurer really overcharged. In this example, seven or eight times the real cost of coverage.

So I think—as just a someone observing the scene—that this kind of thing will be thought about and picked up on. If the gap insurers, actuarially, are charging to cover things that National Health Insurance would cover anyway, then they are overcharging.

At some point, an enterprising person (I want to say victim but I don’t really want to shade this) will decide to get their money back from the gap insurer. They will go to court under the Consumer Protection Act and make a claim like this. And it will be interesting to see how it turns out.

Especially with Mizuho Fukushima as the Minister for Consumer Affairs, and Minshuto running the government.