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3. The Healthcare Crisis: A Standoff Between Hospitals and Insurance Companies

The standoff between the hospital owners' syndicate and insurance companies is growing more intense. With the crisis worsening, the syndicate refuses to back down, insisting on a 15% increase in hospital fees—something insurers categorically reject. This dispute highlights the deep dysfunctions of an already fragile healthcare system, reinforcing the urgent need for reforms to fix its structural weaknesses.

The conflict between the hospital owners' syndicate and insurance companies remains unresolved. Hospitals say they are grappling with soaring inflation and steadily rising operating costs, prompting them to demand a 15% increase in hospital fees. According to hospital executives, this adjustment is essential to offset the rising costs of medicines, medical supplies, and staff salaries. The syndicate also warns that many hospitals are struggling to stay afloat, weighed down by a worsening financial situation, further strained by delayed payments from the state and insurers.

However, this request has sparked strong objections from insurance companies, who "fear that this increase will further burden policyholders," said Assaad Mirza, president of the Association of Insurance Companies, in an interview with This is Beirut. For insurers, such an increase could lead to a significant rise in premiums, which have already surged by 10 to 15%, representing an additional burden for Lebanese people already heavily impacted by the crisis. Their argument is that the fee increase will not address the underlying issues of the healthcare system and could, in fact, worsen the financial situation of policyholders and increase pressure on an already fragile sector. After "categorically rejecting" the hike, and in an effort to avoid escalating the situation, insurance companies have decided to seek a compromise, ensuring that patients, "who are already suffering enough from the high cost of living," do not bear the consequences of the ongoing issues with hospitals.

Insurance companies have therefore “asked hospitals to try to control doctors' fees, prosthetic bills, and anything related to surgeries," continues Mirza, referring to potential abuses in this area. "Once this is examined, talks on increasing hospital bills can begin," he assures.

Mirza notes that insurance companies are willing to approve a 4% increase. However, the Syndicate of Hospital Owners responds by stating that of the 15% requested, 7.5% would go to the hospitals, with the other half allocated to doctors, equipment, and medicines.

In this context, the Syndicate of Hospital Owners argues that "the actual cost of services no longer keeps pace with the rising prices of products, particularly consumer goods included in the cost of hospital services (items not charged separately), especially after subsidies have been removed on some of them."

According to sources close to the Syndicate of Hospital Owners, the syndicate's president, Sleiman Haroun, suggested to insurance companies that the fee increase be implemented in three phases: 5% starting April 1, an additional 5% on June 1, and a total increase of 15% by the end of the year. However, this suggestion was categorically rejected by the insurance companies. Mirza explains that the health insurance sector is unable to bear such a financial burden, particularly given the 140% losses recorded last year, as confirmed by studies conducted by the Ministry of Economy. He adds that the increase already applied is intended to offset part of these losses. He also notes that more than 200,000 people have left the insurance sector due to the economic crisis, and that the rising costs of cancer treatments, which increased by 80% between 2011 and 2020, have significantly contributed to these losses.

Mutual Insurance Organizations: A System Lacking Regulation

In this context, the situation of mutual insurance organizations, which play a crucial role in covering medical expenses for a portion of the Lebanese population, requires urgent regulation. Unlike many other countries, mutuals in Lebanon are not properly regulated and, as strange as it may seem, are under the jurisdiction of the Ministry of Agriculture. This lack of regulation leads to inequalities in coverage conditions, leaving many policyholders uncertain about their reimbursements and the quality of care they may receive. According to well-informed sources, about 90% of mutuals do not provide formal contracts, but only cards, which allows them to change conditions at will. Additionally, they lack financial reserves and are exempt from any form of taxation by the state.

Mutual insurance organizations, which are collective insurance plans often subscribed to by groups linked by religion or family, are widely regarded by insurance companies and hospitals as inadequately regulated. This results in frequent disputes over reimbursement amounts and payment delays.

It is undeniable that for many Lebanese, access to quality healthcare is becoming increasingly difficult due to rising costs of hospital fees and insurance premiums. This precarious situation underscores the Lebanese government’s failure to reform a healthcare sector that is increasingly decentralized and burdened by significant financial pressures.

It is urgent that the Lebanese authorities find sustainable solutions to restructure the healthcare system. This includes implementing strict regulation of mutual insurance organizations, clarifying the roles and responsibilities of insurance companies, and revising hospital fees to align with the country’s economic reality. Without such reforms, the Lebanese healthcare system will continue to struggle to remain operational, leaving the Lebanese people facing an uncertain future in terms of healthcare.