Surgery: Is It Covered by Health Insurance?

Maybe you’re about to have surgery, or perhaps your doctor has recommended an operation. Now you might be wondering: Will this surgical procedure be covered by health insurance? In this guide, you will learn about inpatient and hospital benefits, different types of surgery, and how to know if your operation is covered by your insurance policy.

What are surgery insurance benefits?

Health insurance provides protection so you do not have to bear the financial burden alone when you need to be hospitalized. In the event that you have surgery, your costs may be covered by your inpatient or hospital benefits.

Inpatient benefits in Hong Kong usually include:

• Hospital room and board (private, semi-private, ward)
• Intensive care unit fees
• Operating theater fees
• Doctor and specialist consultation fees
• Surgery expenses
• Anesthetist charges
• Medication and drugs
• Diagnostic scans and tests (i.e., X-rays, CT scans, PET scans, MRIs, laboratory tests)
• Rehabilitation

The cost of surgery depends on many factors, such as what procedure is done, which hospital you go to, the length of stay, the type of room you stay in, and the level of treatment you receive. Moreover, the amount of coverage you receive from your insurance provider depends on your plan.

Some plans, like international health insurance plans, are quite comprehensive, often providing full coverage. Other plans, like most local medical insurance plans, might not provide full coverage, requiring you to pay out-of-pocket for any amounts exceeding your plan’s sub-limits.

If you are having surgery that does not require an overnight stay at the hospital, then you would be considered a day-patient or outpatient surgery/procedure case. Usually, day-patient benefits are listed under hospital benefits. If your surgery takes place in an outpatient setting, such as cataract surgery or a colonoscopy, it will be listed under outpatient surgery/procedure benefits.

What are the different types of surgery?

Elective vs emergency surgery

Elective surgery is a surgical procedure that is planned in advance. The patient and doctor work together to decide whether or not surgery is appropriate. If the patient and doctor elect to proceed, then they can schedule a date and time for the surgery. It does not carry the same sense of urgency as emergency surgery.

Be careful not to confuse “elective” with the term “not medically necessary.” Whether or not an elective surgery is medically necessary depends on the surgery.

Examples of elective surgeries:

• Hernia surgery
• Cholecystectomy (gallbladder surgery)
• Prostatectomy (prostate surgery)
• Partial colectomy (to treat colon cancer)
• Mastectomy (to treat breast cancer)

Emergency surgery is a surgical procedure to treat trauma or acute illness when a patient arrives at a hospital’s accident and emergency department. As the name suggests, emergency surgery is not planned.

Examples of emergency surgeries:

• Appendicectomy or appendectomy (appendix removal)
• Intestinal obstruction repair
• Peptic ulcer surgery
• Cholecystectomy (infection)
• Bowel resection with colostomy (e.g., for a ruptured bowel)

Major vs. minor surgery

Major surgery usually involves opening the body to access organs in the head, chest and abdomen. It takes time to recover from major surgery, as there is major trauma to the tissues, and the risk of infection is high, so patients may need to stay in the hospital for a longer duration. Major surgery usually leaves a big scar.

Major surgery examples:

• Brain tumor removal
• Cesarean section
• Gastric bypass surgery
• Joint replacement
• Open-heart surgery
• Organ removal or replacement

Minor surgery, on the other hand, does not involve cutting open the body. Instead, it is minimally invasive, performed laparoscopically or arthroscopically. Through tiny incisions, the surgeon inserts surgical tools and a tiny camera into the body to operate. Minor surgery has a lower risk of complications and infection. Recovery time is much shorter. In some cases, patients can go home on the same day.

Minor surgery examples:

• Cataract surgery
• Arthroscopic anterior cruciate ligament ACL reconstruction
• Arthroscopic rotator cuff repair
• Laparoscopic hernia repair surgery
• Laparoscopic spleen removal surgery
• Laparoscopic cholecystectomy (gallbladder removal surgery)

Common surgeries

Some common surgeries performed in the United States include:

• Appendectomy
• Breast biopsy
• Carotid endarterectomy
• Cataract surgery
• Cesarean section
• Cholecystectomy
• Coronary artery bypass
• Debridement of wound, burn or infection
• Dilation and curettage (D&C)
• Free skin graft
• Hemorrhoidectomy
• Hysterectomy
• Hysteroscopy
• Inguinal hernia repair
• Low back pain surgery
• Mastectomy (partial mastectomy, total mastectomy, modified radical mastectomy)
• Partial colectomy
• Prostatectomy
• Tonsillectomy

Does health insurance cover common surgeries?

Whether or not your health insurance plan covers a specific type of surgery – and to what extent – will depend on whether it is medically necessary. You will also want to check your policy’s benefit terms to find out if the surgery is excluded from your policy; if there is a waiting period or moratorium in your policy; and what type of plan you have.

Check if the surgery is “medically necessary”

In the eyes of your insurance provider, not all surgeries are created equal. Only surgeries that are deemed “medically necessary” may be covered by insurance; surgeries that are not considered medically necessary are not covered.

Note that each insurance provider has its own set of criteria for what is considered medically necessary. As an example, here is Cigna’s definition:

"Medically Necessary" or "Medical Necessity" means health care services that a physician, exercising prudent clinical judgment, would provide to a patient. The service must be:

1. For the purpose of evaluating, diagnosing, or treating an illness, injury, disease, or its symptoms
2. In accordance with the generally accepted standards of medical practice
3. Clinically appropriate, in terms of type, frequency, extent, site, and duration, and considered effective for the patient's illness, injury, or disease
4. Not primarily for the convenience of the patient, health care provider, or other physicians or health care providers
5. Not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient's illness, injury, or disease

Medical insurance policies do not cover surgery to enhance one’s appearance or aesthetics (i.e., cosmetic or plastic surgery) because it is not deemed medically necessary. On the other hand, reconstructive surgery following an accident or medical illness may be covered by insurance.

Surgeries that are not likely to be covered by medical insurance:

• Breast augmentation/reduction for strictly cosmetic purposes
• Abdominoplasty (tummy tuck) for strictly cosmetic purposes
• Weight loss surgery for strictly cosmetic purposes
• Gender reassignment surgery
• LASIK surgery

That said, even if a certain surgery is medically necessary, whether or not it is covered by insurance – and how much coverage you can get– depends on the terms and conditions of your policy and is up to the discretion of your insurer. The factors at play in determining coverage for surgery include pre-existing conditions, exclusions, limits, and moratoriums or waiting periods.

Check for exclusions and moratoriums or waiting periods

It is important to check the terms and conditions of your policy for exclusions and moratoriums.

Surgery for items listed as exclusions in your policy will not be covered by your insurance.

Some common exclusions:

• Pre-existing conditions
• Congenital deformities or anomalies
• Fertility treatment
• Cosmetic surgery
• Weight disorders (obesity)
• Sleep disorders
• High-risk activities
• Injuries related to professional sports
• Substance abuse or self-inflicted injuries
• Mental disorders

Moratoriums vary in length depending on the item covered and your policy. This can be anywhere from 6 months to 4 years. During this period, you cannot claim for related expenses, so if you have related surgery, it will not be covered.

Common items with moratoriums or waiting periods:

• Pre-existing conditions (i.e., diabetes, high blood pressure)
• Pregnancy (for plans with a maternity benefit; usually the waiting period is 9 to 12 months)
• Major dental treatment (for plans with a dental benefit)
• HIV/AIDS
• Gynecological diseases
• Hernia
• Joint replacement
• Cataracts

Additionally, many health insurance policies have a waiting period of 30 days after the policy start date, during which no claims can be made (except those arising from accident or injury).

Check your policy’s limits and sub-limits

Although your surgery might be covered by your insurance plan, it might be subject to limits and sub-limits. Check these carefully.

Most local insurance policies in Hong Kong will have sub-limits on inpatient benefits. International insurance providers, on the other hand, have more comprehensive coverage and frequently cover costs in full.

How do I know if my surgery is covered?

Step 1: Check your policy’s terms and conditions

To determine if a certain surgery is covered by your insurance policy, carefully read the terms and conditions and check for:

• Exclusions. Is your surgery for an excluded pre-existing condition? Is it for something else that is excluded from your policy, such as an injury from a professional sport?
• Moratorium or waiting period. If the surgery is for something with a moratorium attached to it, has the moratorium passed?
• Benefits. If it’s dental surgery, does your plan have dental benefits? If you need a C-section, does your plan have maternity benefits?
• Plan limits and maximums. How much of your surgery will your policy cover? Do you need to go to specific hospitals for it?
• Cost-sharing: Copays, deductibles, coinsurance. How much will you have to pay out of pocket?

Step 2: Ask your broker or insurer

It’s always best to contact your insurance broker or insurance provider directly about the surgery. They can let you know if this surgery is covered and to what extent.

If the insurance provider will cover your surgery, then, for day-patient or inpatient surgeries, they will get in touch with your hospital to validate the surgery and costs and give preauthorization to the procedure. They will also set up a guarantee of payment through which the insurer will pay the hospital directly so you do not have to handle the paperwork. You will need to present your pre-authorization letter or guarantee of payment upon admission.

(Since the pre-authorization is a preliminary assessment, the final costs may not be the same as the estimate. The final claim payment will be made according to the final bill produced by the hospital and the final assessment made by the insurer’s medical board.)

The bottom line

Generally, surgeries that are considered medically necessary and are neither a part of the exclusions in your insurance plan nor subject to a moratorium should be covered by insurance. To ascertain if you are covered for a certain surgery, and how much coverage you can get, it’s best to talk to your insurance broker or provider directly.