Even for those privately insured, the cost of being hospitalized with COVID-19 can run to millions of lira

Amid skyrocketing hospitalization and medical costs in Lebanese lira, reimbursement schemes are struggling to keep up. Whether they are covered by the state, the National Social Security Fund or private insurance, COVID-19 patients in Lebanon more often than not find themselves paying out of their own pocket to cover medical bills

Even for those privately insured, the cost of being hospitalized with COVID-19 can run to millions of lira

The amount of fees incurred by COVID-19 patients in Lebanon averages LL2 million-LL 3 million, and can climb up to LL20 million. (Credit: Marc Fayad)

The steep rise in hospitalization costs is a tragedy for many COVID-19 patients in Lebanon. The lira has lost almost 90 percent of its value since it started to deviate from the official peg of LL1,507.5 to the dollar in mid-2019. And while public hospitals are registering losses in relation to the exchange rate, private hospitals are partially passing them on to their patients.

Depending on the severity of the cases and the number of days of hospitalization required, patients are now paying out of their own pockets to cover their bills.

“About 90 percent of patients pay additional fees, regardless of the [health] coverage they receive,” says Judy Dimassi, a nurse in a private hospital.

Muhammad Karaki, the NSSF director-general, says the bill can be exorbitant, “with the average amount ranging between LL2 million and LL3 million.”

Meanwhile, Yehya Khamis, the general director of the Cooperative of Government Employees, says, “The [uncovered cost] could climb up to LL20 million, especially if treatment was provided in Beirut.”

In public hospitals, the state is absorbing the losses, but the “situation is untenable,” warns Hassan Wazni, head of the Nabih Berri Governmental University Hospital in the southern town of Nabatieh.

“We are losing money every day because [treatment] for the coronavirus patients is very expensive. It is imperative to formulate a strategy quickly,” he says.

In the meantime, patients pay only 10-15 percent of the total bill, depending on the reimbursement scheme their health coverage offers.

The public sector, however, has only 20 percent of COVID-19 beds out of the country’s total bed capacity, and it is becoming increasingly difficult for coronavirus patients to find beds in public hospitals.

With a saturated public sector, patients have no choice but to opt for private hospitals, which require additional payments — payments that a population confronted with collapsing purchasing power find it difficult to make.

“Half of the people registered with the National Social Security Fund earn less than LL1 million per month,” Karaki says, stressing that “it is not uncommon for patients to turn to associations or political figures to settle their bills.”

In order to avoid any potential delays in payment, most private hospitals require upfront payments — regardless of the patient’s health coverage — ranging between LL5 and LL10 million.

“It is a common practice,” confirms Elie Torbey, president of the Association of Insurance Companies in Lebanon — known by its French acronym ACAL — “although this is in conflict with what we have agreed on with the private sector.”

Therefore, a growing number of COVID-19 patients seek to avoid hospitals, “opting for treatment at home or dispensaries,” Dimassi says.

The most disadvantaged receive aid from certain NGOs such as Arcenciel, which provides “free oxygen therapy machines as well as medications to patients who meet their vulnerability criteria,” explains Nadim Abdo, the director of one of the organization’s programs.

But when hospitalization becomes necessary, money becomes a must.

Explosion of costs

The costs private hospitals encounter in relation to COVID-19 treatment are substantial, and these are passed on to the patient.

First, there is the personal protective equipment, which is essential but not subsidized, and hospitals must purchase it with fresh dollars.

“A set of non-reusable PPE kits costs around $10. Knowing that the medical staff can make up to 20 visits [per day] to a patient, which means that this can amount to more than LL2 million per day,” says Sami Rizk, executive director of the Lebanese American University Medical Center — Rizk Hospital.

Another problem is the purchase of prescribed treatments for COVID-19.

The importation of medications is subsidized by Banque du Liban, but supply shortages sometimes prompt hospitals to purchase medicines on the black market.

“The price of one dose of remdesivir, an antiviral, can go up to LL3.5 million on the black market, compared to its official price of LL300,000,” explains Rizk.

This treatment, which generally lasts a week at a rate of one dose per day, is in any case not covered by the state or the NSSF. It is covered only by private insurance.

Finally, the supply of oxygen, the cost of which has tripled since the crisis, is another factor that is swelling the bill.

“Liquid oxygen is produced in Lebanon partly from fuel oil and therefore receives subsidies from the BDL, but its transport and storage require adequate infrastructure, the costs of which are in dollars,” explains Rizk.

He also underlines the costs in relation to investments made to increase the hospitals’ capacity.

“We have fitted out over 60 additional beds dedicated to COVID-19 cases, between intensive care and isolation beds, [and we’ve] purchased respirators, monitors and medical supplies, all in fresh dollars,” Rizk says.

While medical equipment is mainly subsidized up to 85 percent, Rizk assures that “none of the investments made in the fight against COVID-19 have received subsidies.”

Re-evaluation of reimbursement fees

These issues have allowed hospitals to obtain a reassessment of reimbursement rates, but the adjustments remain, according to them, below the real costs.

Negotiations first took place with the NSSF, which covers some 650,000 private sector employees as well as their families; the civil servants’ cooperative, covering 386,000 public sector employees; the security forces fund, covering around 80,000 members of the security personnel; and the Health Ministry, which covers 50 percent of the Lebanese who do not have social protection.

These different institutions have agreed on new coverage schemes for the coronavirus.

For now, they continue to cover hospital costs at a rate ranging between 85 and 90 percent of the total medical bill, depending on the institution, with no limit on hospitalization days. Efforts, however, have been made to cover the cost of PPE, which was previously incurred by the patients.

The NSSF and the Health Ministry repay LL400,000 and LL500,000, respectively, for PPE per day for patients in intensive care.

Oxygen is also subsidized at a rate of LL108,000 per day, compared to the previous rate of LL30,000.

The coverage of regular beds has also increased. The NSSF hospital package now varies depending on the hospital and the type of care, and ranges between LL500,000 and LL750,000 for intensive care rooms, and LL250,000 and LL300,000 for other rooms.

The cost of medicines, however, is still incurred by the patients. “We are doing what we can with a limited budget,” Khamis says.

The NSSF says it has been doing its best and accuses certain hospitals of taking advantage of the situation.

“We observed excessive differences [in bills], and sanctions were taken against private hospitals that did not respect social security rates,” says Karaki.

But hospitals have a different story to tell.

“The rates set by the state had not been reviewed for 10 years, whereas today with the exchange rate, the prices have significantly increased: LL400,000 is barely enough [to cover] four PPE kits,” explains Rizk.

At LAUMC-RH, it is estimated that treating a COVID-19 patient costs between LL1 million and LL5 million per day, depending on the severity of the case, which remains much higher than the NSSF contribution, even after the fund adjusted its rates. This is not to mention the delays in state and NSSF payments.

In the midst of the pandemic, some establishments have chosen to treat only patients who hold private insurance policies, with or without NSSF coverage, knowing that this group amounts to just 13 percent of the Lebanese population.

Private insurance

But even this small category of policyholders is not safe from incurring a bill as a result of price increases.

First, insurance companies have been obliged to cover coronavirus patients only since April 15, 2020.

Less than half of the policies issued prior to this date cover cases related to a pandemic. The Wehbe family learned this the hard way.

“My 23-year-old brother was rushed to the hospital in December. As soon as the PCR test was out, our insurance company informed us that he was not covered,” says Jennifer Wehbe, whose family had to pay all the hospital costs, amounting to LL20 million.

The family then submitted a request for reimbursement to the Health Ministry “but it was declined for reasons that were not explained,” she adds.

But even when the reimbursement request meets the set criteria, the coverage is not full.

“Insurance companies have entered into various agreements with hospitals,” explains Torbey, head of the ACAL.

Thus, not all policyholders are the same. Some insurance companies cover PPE and medications, others do not.

There is, however, one common point: the reimbursement ceiling. This amounts to about “LL55 million for each patient,” Torbey adds.

This amount is sufficient for some, such as Hiba, a young artist who did not have to pay a penny for a two-day hospitalization in March. But for other patients, especially those who must stay weeks at the hospital, “their bill exceeds the ceiling,” Rizk confirms.

In any case, policyholders incur part of the costs as a result of the national currency depreciation, since they now have to pay part of their premiums in lollars, i.e. dollars deposited in Lebanese bank accounts that can be withdrawn only in Lebanese lira at an exchange rate of LL3,900.

The insurance companies have been committed to “paying half of the hospital bill, denominated in dollars, at the intermediate rate of LL3,900 to the dollar, and the other half at the official price,” explains Torbey.

This agreement is valid as long as “the exchange rate on the parallel market is stable, BDL guarantees the preferential rate for the local currency at LL3,900 and the subsidies continue,” Rizk warns.

In other words, this agreement will not stand for long.

Other social protection institutions are still at a loss as to how to fund the increased coverage rates.

At the NSSF, the additional costs of COVID-19 treatment, taking into account the exchange rate, are estimated at LL18 billion.

“We have been discussing the issue in the board in order to find ways to secure funding. This would require exceptional aid from the state, or an increase in social contributions,” explains Karaki.

These choices, however, are all the more difficult to make in light of the crisis, public accounts deficits and the collapsing contributions of the private sector.


This article was originally published in French in Le Commerce du Levant. Translation by Sahar Ghoussoub.

The steep rise in hospitalization costs is a tragedy for many COVID-19 patients in Lebanon. The lira has lost almost 90 percent of its value since it started to deviate from the official peg of LL1,507.5 to the dollar in mid-2019. And while public hospitals are registering losses in relation to the exchange rate, private hospitals are partially passing them on to their patients.Depending on the...