Cyprus healthcare is changing for the better

I’ve written previously that one of the reasons I’ve decided to do one more year is because we’d like to let the dust settle a little more on Brexit and in particular how reciprocal healthcare, via say the S1, will be handled in our dotage.  In recent weeks some good news seems to be coming out of Cyprus, independent of any Brexit nonsense, that might just mean Brexit negotiations will become unimportant.  Let me explain.

For our situation there seem to be 2 ways to get into the Cyprus public healthcare system.  The first is to pay Cyprus Social insurance for a minimum of 3 years and then meet a number of other criteria.  Unfortunately, unlike countries like Malta and Spain, it doesn’t seem possible to pay these voluntarily.  You have to be either working or self employed.  This is out as I want work to be 100% optional when we move.  That’s always been my definition of Early Retirement.  The second is to reach State Pension age and apply for an S1.  This is what I’m concerned about losing as part of Brexit.

So that leaves us with the Cyprus private healthcare system.  Getting basic care seems affordable and efficient.  I was able to walk into a private clinic in Cyprus where there was absolutely no queue and have a prescription renewed for EUR10.00.  I then went to the pharmacy where said prescription cost me EUR3.47.  A visit to a GP seems to be around EUR30.00 and treatment almost seems immediate.  In contrast in my neck of the woods here in the UK I could literally die while just trying to make an appointment to see a GP let alone waiting to see one.

So far so good.  The problem for me is if it’s something more serious.  For that we’re going to want Cyprus private health insurance.  From contacts in a few of the forums I frequent we’ve been able to remotely apply to a company who apparently pay up efficiently when you’ve sought treatment.  Good news is that they’ll cover us but it comes with one exception for a pre-existing condition.  This is the problem for us.  It’s not this pre-existing condition as it’s manageable but as we age what if we pick up a few more and then at some point the insurance company says you’re now too high risk.  They then can either stop insuring or push premiums up so far that it forces us to go elsewhere.  Then where do we go particularly given all the companies I’ve found so far won’t cover you at all above a certain age unless you’re already with them.  Even if we could find someone they then won’t cover you for the reasons the first company didn’t like you which sort of defeats the purpose of having insurance in the first place.  What then?

This is where the changing Cyprus healthcare landscape looks like good news for us.  On the 16 June 2017 Cyprus parliament passed three bills that pave the way for a Cyprus National Health Service (NHS).  Great I thought, now everyone will go on strike and it will become a disaster but that doesn’t seem to be happening.  For example, just yesterday, State and doctor union representatives have signed a framework agreement.  So in 6 weeks they’ve sorted that.  Makes our Brexit negotiators look like amateurs.  This might just be about to happen.

So the first question is will we be eligible?  It certainly looks like it.  The basic principles governing the Cyprus NHS is that “The NHS is designed to be universal, socially-oriented, supportive, integrated and accessible”.  Socially orientated means “that it covers the entire population, without exceptions, discrimination and regardless of their financial capacity” and they name the beneficiaries as “all citizens who have their habitual residence in the areas controlled by the Government of the Republic and fall into one of the following categories:

• Cypriot citizens
• European citizens residing and working or having acquired the right of permanent residence
• Third-country nationals who meet the requirements of national law
• Those dependent on the above”

So far so good.

So the next question is what’s going to be covered?  Positively “all the health needs, including the medicinal needs of Cyprus residents, will be totally covered”.  Great.

So when’s it going to be up and running?  It looks like a phased approach given “the system will be fully operational, as far as in-patients are concerned, at its final phase from June 1, 2020.  But one year earlier, on June 1, 2019, we will provide all the rest”

How much is it going to cost us?  Everybody who has an income will be expected to contribute.  The costs look like from 01 March 1, 2019:

• employees pay 1.7% of their salaries, their employers a further 1.85% and the state a further 1.65%;
• self-employed pay 2.55% of their income; and 
• pensioners, those living on income from rent and other independent means and government officials will pay 1.7%.

As more services come online the costs then increase so 01 March 1 2020 costs go to:

• employees pay 2.65% of their salaries, their employers 2.9% for their employers and the state a further 4.7%;
• self-employed pay 4% of their income; and
• pensioners, those living on income from rent and other independent means and government officials will pay 2.65%.

That’s pretty quick and would work for us.  My worry here is then not can I afford it but that this looks a bit too good to be true.  Let’s say we enter Cyprus with dividends of around EUR30,000.  A 2.65% contribution is going to mean NHS payments of only EUR795 per annum.  I really hope they haven’t under done it and it falls apart because of a funding crisis.

Will demand then become so high that it falls apart like the UK NHS?  Here the Cypriots look to be playing it sensibly.  In the UK the NHS is, as we know, completely free at the point of us.  In RIT’s simple world if something has value and is free then demand becomes infinite.  It’s one of the reasons I believe the UK NHS is so broken.  In contrast to visit a Cypriot specialist will incur a charge of EUR6.00, a visit to A&E will cost EUR10.00 and a prescription will cost EUR1.00.  Positively, they will then cap these charges annually to help those with genuine needs.  For example the general population will max out at EUR300.00 and low-income pensioners at EUR75.00.

If this does play out as planned it’s looking like Brexit, and all the political posturing that’s going with it, will be unable to affect our dreams so I’m keeping a watchful eye on developments.  Sure, my UK State Pension may end up not being up-rated with inflation but I’m not planning on one of those anyway and the Cyprus NHS will cost more than somebody in Cyprus with an S1 pays today but my planning assumes I’d need to be paying healthcare premiums so that’s covered as well.  Bring it on I say.

As always DYOR.