Designing a Small Team’s Medical Benefits: Inpatient, Outpatient and Limits

By Expat Insurance Hong Kong · 12 October 2026

~27 min. read

Three quotes land in your inbox for the same team of 14. They look alike at the top. Then you open the benefit schedules, and the room limits, visit caps and co-payments don’t match anywhere.

That gap is where group medical benefit design happens. For a small company group medical scheme in Hong Kong with 8 to 25 staff, it’s the work of deciding which bills the scheme must absorb, which it can share with staff, and which it can leave out. Price matters. The schedule decides what your people actually receive on the day they need it.

This guide takes the choices in the order that matters: inpatient first, then limits, outpatient, co-payments, extras, tiering and a fixed budget. How a premium is rated, how a small group is underwritten, how dependants join and what to check at renewal each have an article of their own. Here we stay on group medical benefit design.

Group Medical Benefit Design Starts With the Bill Staff Can’t Absorb

Most people can absorb a GP bill out of a month’s pay. Almost nobody can absorb a surgeon, a theatre team and several nights in a private ward. Good group medical benefit design starts from that gap, because it tells you where the scheme earns its keep.

For any group medical insurance Hong Kong employer, the local numbers point the same way. The Consumer Council reports that the private sector provides “68% of out-patient services but only about 10% of in-patient services”.[6] Our reading is that private outpatient care is routine for many households, while private hospital care is the rarer event with the bigger invoice. The same study found that the median price of one common operation, haemorrhoidectomy, ranged from HKD33,881 to HKD85,387 across private hospitals, a 152.0% difference.

Unpredictable bills create disputes. The Council logged 191 complaints about private hospitals and day procedure centres between 2021 and 2024, and price or charge disputes were the largest share at 45.5%.[6] A Government and private hospital pilot now publishes historical bill sizes for 30 common procedures,[13] which gives a small company something real to hold a benefit schedule against.

Public care remains an option, and it’s changing. The Hospital Authority describes its fees reform, in force from 1 January 2026, as “Co-payment for those who can afford it and for those with mild conditions”,[14] with an annual spending cap of HK$10,000.[15] Staff who prefer private care need a scheme that pays the large bill. So we treat inpatient as the floor and everything else as a choice about what to add. The table below lists the seven choices that make up a schedule.

Inpatient and Outpatient Benefits: Start With Inpatient, Then Set the Limits

The Insurance Authority describes hospitalisation cover as mainly “room and board, doctor’s visit fees, surgery fees and miscellaneous charges”,[5] with “a maximum limit for each medical benefit item” and a choice of class. That one sentence holds three decisions: the room tier, the limit on each item and the annual limit for the whole illness.

The room tier

The room tier sets the benchmark for the rest of the claim. In MSIG’s small-company schedule, Plans 1 to 3 entitle a member to a general ward, Plan 4 to a semi-private room and Plans 5 and 6 to a standard private room.[1] The daily room and board limit climbs from HK$330 at Plan 1 to HK$4,100 at Plan 6, for up to 120 days per disability each year.

If a member books a room above their entitlement, the schedule scales the extra cover down. A member entitled to semi-private but placed in a standard private room gets 50% of the supplementary major medical benefit, and the benefit “shall not be payable for hospital confinement in class of suite, VIP and deluxe room”.[1] Tell staff which tier they hold before they need it. The Council found that 43% of insured inpatients still chose public hospitals, a pattern it linked to worries about private costs, claim eligibility and renewal premiums.[7]

The annual limit and per-disability limits

An annual limit caps what a member can claim in a policy year. In policy wording, a “disability” generally means one illness or injury and the conditions that flow from it, and a per-disability limit caps that. The Council quotes policy wording that says “no benefit will be payable in respect of more than 1 procedure resulting directly or indirectly from the same disability”,[8] so read that clause before you compare totals.

Sub-limits matter as much as the annual limit. In the same MSIG schedule, intensive care is capped from HK$10,000 at Plan 1 to HK$80,000 at Plan 6, and cancer treatment and renal dialysis from HK$10,000 to HK$150,000.[1] Two schemes with the same room tier can leave very different gaps in a serious illness.

Supplementary major medical

Supplementary major medical is the layer that answers “what if it goes on for months?”. The Insurance Authority explains that it lets the insured “claim a prescribed percentage of the relevant medical expenses in excess of the maximum payable benefits”.[5] MSIG’s version pays 80% after a HK$1,000 deductible per disability per year, up to an annual limit that runs from HK$30,000 at Plan 1 to HK$200,000 at Plan 6.[1] It must match the inpatient plan level.

Hospital cash and sick pay

Some schedules add a daily cash payment for stays in a government ward, to cover “the loss of income during a stay in hospital”.[5] It sits beside the statutory allowance. Under the Employment Ordinance, sickness allowance is “equivalent to four-fifths of the average daily wages earned by an employee”.[12]

Outpatient Benefits: Where Staff Feel the Scheme Every Week

Inpatient and outpatient benefits do different jobs. Inpatient cover protects. Outpatient cover is what people use. The Insurance Authority notes that outpatient benefits normally carry “a yearly and daily limit on the benefit amount and number of visits”.[5] The annual limit, the visit cap and any co-payment decide whether staff think the scheme is generous.

MSIG’s schedule shows the shape. A general practitioner visit is limited to HK$205 at Plan 1 and HK$910 at Plan 6, up to 30 visits a year, with a network co-payment of HK$50 at Plan 1 and HK$25 at Plan 2 and none above that.[1] Specialist visits carry a network co-payment of HK$130 at Plan 1 and HK$60 at Plan 2, and need a written referral unless the specialty is on an exempt list. Diagnostic tests and prescribed medication each have their own annual limit.

100% or 80%

The simplest dial is the reimbursement rate. MSIG lets an employer choose 100% of outpatient or dental claims for fuller cover, or “80% reimbursement to reduce costs”.[1] Its “One Level Up/Down” feature also lets the outpatient level sit one step above or below the inpatient level, so a company can hold a stronger hospital plan and a lighter clinic plan without buying the top level of both.

Staff also judge a plan by how a clinic visit feels. AXA says members go cashless by presenting the eHealth Card in its app “when visiting a network clinic”.[4] Ask any insurer which services are cashless and which are claimed back. Our guide to outpatient health insurance in Hong Kong covers the individual side.

Co-Payment, Deductible and Co-Insurance: What They Do to Premium and Behaviour

Group medical benefit design leans on three tools to share the cost with staff. A co-payment is a fixed sum each time. A deductible is the first slice the member pays before the insurer does. Co-insurance is a percentage split. MSIG’s schedule uses all three: a per-visit co-payment, a HK$1,000 deductible on supplementary major medical, and 80% reimbursement on outpatient.

The Insurance Authority makes the premium link plain for individual plans: “the higher the deductible, the lower the premium”.[5] The same logic applies when a group sets a co-payment. The member carries a little of each small claim, so the insurer carries a little less.

What the research says staff do

The best evidence on behaviour is a large US experiment. RAND found that participants who “paid for a share of their health care used fewer health services than a comparison group given free care”, with one to two fewer physician visits a year and 20 percent fewer hospitalisations.[10]

The caution is in the exceptions. On average, cost sharing did not harm health, but free care did better for some conditions, and “these improvements were concentrated among the sickest and poorest patients”.[10] A flat co-payment may weigh more on a junior employee with a chronic condition than on a director. Co-payments still have a place. Just choose the amount with your lowest-paid person in mind.

Read the small print on charges

Cost sharing is clearer than the clause that decides how much the insurer will recognise. The Council explains that “reasonable and customary” charges give “insurance companies the right to assess the charges of physicians or hospitals submitted in the claims”.[7] Ask for the definitions in writing before you compare.

Optional Extras: Maternity, Dental, Optical, Chinese Medicine and Wellness

Extras are where small company group medical schedules differ most between insurers, and where staff opinions differ most too. AXA’s optional group medical cover lists supplementary major medical, childbirth, outpatient and dental,[3] and its small-business plan AXA lite offers “dental and vision benefits” as an option.[2] MSIG lists “optical treatment” among its exclusions.[1] Check what your chosen insurer offers before you promise a benefit to staff.

Maternity

Maternity is team-dependent. MSIG’s small-company plan lists “Pregnancy, childbirth, birth control and treatment for infertility” among its major exclusions,[1] while AXA offers childbirth as an optional add-on.[3] Where it is offered, an annual limit and waiting periods apply. Our guides to maternity waiting periods and maternity benefits set out how those rules work.

Dental and optical

Dental is a modest perk with broad appeal. In MSIG’s schedule, the annual limit for dental runs from HK$1,060 at Plan 1 to HK$10,600 at Plan 6, and dentures, crowns and bridges are covered “only if necessitated by an accident”. Ask what routine care the dental benefit pays for before you assume it covers a crown.

Chinese medicine and physiotherapy

The Insurance Authority notes that outpatient benefits “may also include consultations with Chinese medicine practitioners, physiotherapists, Chinese bonesetters, and specialists”.[5] In MSIG’s schedule, Chinese herbalist, bone-setting, acupuncture and Tui Na visits are limited to 15 a year, so regular users will notice the cap quickly.

Wellness and mental health

AXA says insured employees under designated Employee Benefits policies “can easily get access to the mind health consultation” with psychology-qualified doctors, psychiatrists and clinical psychologists in its network,[2] while its wider wellness programmes are “Exclusive for Certain Eligible Policyholders”. MSIG’s inpatient psychiatric benefit carries an annual limit of HK$5,000 at Plan 1 and HK$50,000 at Plan 6. Ask which services come with your plan and which are extras.

Tiering a Small Company Group Medical Plan by Grade

A small company group medical plan for 8 to 25 staff usually spans several levels of seniority. Some insurers let a company reflect that. MSIG states that the company can “assign eligible employees to different plans by grade, class or service”, up to five plans: one plan for 2 employees, two for 3 to 6, three for 7 to 10, four for 11 to 20 and five from 21. On that rule, a team of 8 could run three tiers and a team of 21 could run five. Other insurers set different rules.

There is a catch. “All employees with the same eligibility must be enrolled into the same plan”,[1] so a tier has to be defined by a rule you can write down, such as grade or years of service, not by who asks. Put the rule in the staff handbook so no one learns about it for the first time at a claim.

The outpatient dial can move separately. You might give everyone the same hospital floor and vary only the outpatient benefits. Your quotes will show whether that costs less than lifting the hospital tier for the whole team.

Top-ups, portability and what happens when staff leave

The Insurance Authority warns that group protection “is terminated immediately if you quit your job”, and adds that some plans “offer top-up options” that let staff buy an extra individual policy.[5] Under its Voluntary Health Insurance Scheme proposals the Government suggested that insurers offer employers an elective conversion option, so a leaving employee could move to an individual plan without re-underwriting.[9] Ask each insurer what it offers today. For senior staff who want more than the company scheme, our guide to top-up health insurance shows how that second layer works.

Choosing a Small Company Group Medical Plan on a Fixed Budget

Group medical benefit design on a fixed budget starts with one question: which gaps would hurt most? We use an order we call “spend by regret”: fund first the bill whose absence would hurt a household most, and leave the nice-to-haves until last.

The order to spend in

First, the inpatient floor. Pick a room tier staff would realistically use, then check the ICU, cancer and surgery sub-limits against it, not just the daily rate. Second, supplementary major medical, for the long illness the core limits don’t reach. Third, outpatient benefits, at 100% or 80%, at the hospital level or one below. Last, one extra at most. Dental is the usual starting point, maternity suits a younger team and wellness suits a stretched one.

What to trade first when the number is too high

Under pressure, the usual trades are the outpatient reimbursement rate, the per-visit co-payment and the room tier for staff who don’t need the top one. We’d be slower to trade away the intensive care, cancer and major-medical limits, because those are the bills no household absorbs. Each trade moves the premium by an amount only your own quotes can show, so ask us to price each one switched on and off.

What the compulsory cover does not do

Employees’ compensation insurance is a legal requirement, but it covers work injury only. From 1 January 2026, an injured employee’s medical expenses are reimbursed up to HK$300 a day for inpatient treatment and HK$500 for outpatient treatment.[11] It does nothing for an employee who is simply ill. Our guide to what Hong Kong law requires of employers covers the compulsory side.

Three Small Teams, Three Different Schedules

The people below are fictional personas we have put together to show which options tend to suit which situations. They are not real clients. Our client information always remains 100% confidential.

Grace*: twelve staff and a budget that is already stretched

*Fictitious persona based on situations we see regularly. We never reveal client information.

Grace* is in her late fifties and leads a team of twelve whose ages run from their thirties to their fifties. She has a number in mind and won’t go over it. Her worry is a hospital stay, not a clinic visit.

On what Grace* has told us, a semi-private tier with supplementary major medical could suit her, with outpatient at 80% and one level below, and no extras this year. That puts her money on the bill no employee could cover alone. We wouldn’t know for certain until we had checked the sub-limits against real quotes.

Imran*: twenty-one staff and a hiring market

*Fictitious persona based on situations we see regularly. We never reveal client information.

Imran* is in his early fifties and runs a team of twenty-one. He’s hiring against larger firms and wants the scheme to say something about how the company treats people, but his budget can’t stretch to the top tier for everyone.

This may be a case for three tiers: private room for directors, semi-private for managers, ward for the junior team, with one outpatient level for all. It could keep the offer visibly generous without lifting the whole premium. Whether the insurer allows three plans at his headcount, and how it prices them, is a question to settle before he commits.

Margaret*: nine staff, mostly in their forties and fifties

*Fictitious persona based on situations we see regularly. We never reveal client information.

Margaret* is in her early sixties and runs a team of nine whose ages sit mostly between 45 and 60. Hospital claims are more likely in a team like this, and several people already hold personal top-up cover.

It could be that the stronger fit is a solid inpatient floor with a higher supplementary major medical limit and a lighter outpatient benefit, with dental and maternity left out and staff top-ups filling their own gaps. That depends on how each insurer handles existing cover, so it needs a direct question.

Group Medical Benefit Design: What to Decide This Week

Group medical insurance Hong Kong buyers often find inpatient and outpatient benefits overwhelming until they split them into seven choices. Decide the inpatient floor first. Decide whether outpatient is 100% or 80%. Pick one extra at most. Then ask for each quote with the choices switched on and off.

Leave the rest for later. How the premium is rated, how existing conditions are treated and who counts as a dependant belong in separate conversations, and so does renewal. The design you choose now is one you can adjust with real claims behind it. If you’d like a second pair of eyes on your schedules, talk to us and we’ll show you where they differ and what each difference means for your team.

How You Get the Group Medical Benefit Design Right

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Insurance content · Expat Insurance Hong Kong

Expat Insurance Editorial Team

Our articles are prepared by the Expat Insurance editorial team, drawing on the day-to-day casework of our licensed brokers and insurance specialists in Wan Chai. Between them, our advisors bring more than 60 years of combined experience arranging medical, life, business and personal insurance for expatriates and local families across Hong Kong.

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Sources & references

1. MSIG Hong Kong — SME Group Medical Insurance: A panel insurer’s small-company schedule, effective 1 March 2026. Six plan levels run from a HK$330 to a HK$4,100 daily room and board limit, with optional supplementary major medical at 80% after a HK$1,000 deductible. Outpatient can be 100% or 80%, and staff can be assigned to plans by grade. “All employees with the same eligibility must be enrolled into the same plan”.
2. AXA Hong Kong — SME Employee Benefits: A panel insurer’s page for small-business schemes, each with basic and optional covers: hospital, clinical, supplementary major medical, childbirth and dental. AXA lite offers “Dental and vision benefits” as an option, with a 3-employee minimum. Insured employees on designated policies can reach mind health consultations with psychology-qualified doctors, psychiatrists and clinical psychologists in the network.
3. AXA Hong Kong — Employee Benefits Tailor Made Solutions: A panel insurer’s overview of how a group scheme is layered. Basic cover is hospitalisation. Optional covers include supplementary major medical, childbirth, outpatient and dental. It says “We provide a wide range of coverage and tailor-made solutions” across group medical, group life and group disability. It gives no limits, but shows how optional layers are named and offered.
4. AXA Hong Kong — AXA Medical Network: A panel insurer’s description of its provider network and cashless access. It cites a vetted network of “over 7,000 medical service providers across Hong Kong, Macau, and the Greater Bay Area”, lists general practitioner, specialist, physiotherapy, laboratory and mind health categories, and explains that members go cashless by showing an eHealth Card at network clinics.
5. Insurance Authority — Medical insurance (consumer education): The regulator’s plain-language guide. Hospitalisation cover has “a maximum limit for each medical benefit item”, and outpatient carries “a yearly and daily limit on the benefit amount and number of visits”. Group protection ends when you leave the job, some plans offer top-up options, hospital cash pays a fixed daily sum, and for individual plans a higher deductible lowers the premium.
6. Consumer Council — Study reveals information asymmetry and price uncertainty in private healthcare (6 March 2025): The Council’s price transparency study. The private sector provides “68% of out-patient services but only about 10% of in-patient services”. The median inpatient price for one operation varied from HKD33,881 to HKD85,387 between private hospitals, and 191 complaints were logged from 2021 to 2024, with price disputes 45.5%. It also describes the voluntary pilot programme.
7. Consumer Council — Actual protection falls short of consumer expectations in private health insurance (29 May 2019): A two-year study of 18 policy contracts from 14 insurers. “Although 43% of inpatients were covered by PHI, they opted to be treated in public hospitals”, which the Council linked to worry about claim eligibility. It explains that “reasonable and customary” charges give insurers the right to assess charges, and calls for clearer definitions of terms such as medically necessary.
8. Consumer Council — Survey on 39 medical insurance plans: read the small print (CHOICE 398): A survey of 39 hospital and surgical plans from 10 insurers. It highlights wording that limits payment: “no benefit will be payable in respect of more than 1 procedure resulting directly or indirectly from the same disability”, and only the largest benefit is payable where several procedures occur. It also lists waiting periods, exclusions and claim deadlines.
9. Consumer Council — Submission on the Voluntary Health Insurance Scheme (consultation): The Council’s submission to the Food and Health Bureau. It states “Group hospital insurance products are not required to be VHIS-compliant”, and describes a proposed Conversion Option letting departing employees move to an individual Standard Plan at the same underwriting class “without re-underwriting”, if the employer bought it with the group policy, so it is worth asking each insurer.
10. RAND — The Health Insurance Experiment: a classic RAND study: A brief on a large US experiment. “participants who paid for a share of their health care used fewer health services than a comparison group given free care”, with one to two fewer physician visits annually and 20 percent fewer hospitalizations. Cost sharing cut effective and less effective care alike. Gains from free care were “concentrated among the sickest and poorest patients”.
11. Labour Department — Maximum daily rates of reimbursable medical expenses adjusted (Employees’ Compensation Ordinance): The Department’s notice on work injury medical cover. After resolutions passed on 26 September 2025, the daily maximums are HK$300 for inpatient treatment, HK$500 for outpatient treatment and HK$700 where both occur on the same day. “The revised maximum daily rates of reimbursable medical expenses have come into effect on 1 January 2026”. It applies to work injury only, not ordinary illness.
12. Labour Department — The Employment Ordinance, Cap. 57: Sick Leave questions and answers: The Department’s explanation of sickness allowance. The daily rate is “equivalent to four-fifths of the average daily wages earned by an employee” over the previous 12 months. Paid sickness days build up at two a month in the first year and four a month after, and “shall not exceed 120 days at any one time”, which sets the baseline a hospital cash benefit sits beside.
13. Office for Regulation of Private Healthcare Facilities — Pilot Programme for Enhancing Price Transparency for Private Hospitals: The Government’s public search tool for the “Pilot Programme for Enhancing Price Transparency for Private Hospitals”. Users pick one of 30 common procedures, including vaginal delivery, caesarean section, knee arthroscopy and hernia repair, and compare Historical Bill Sizes Statistics across participating private hospitals. A practical check on whether a proposed benefit limit is realistic for a given procedure.
14. Hospital Authority — HA fully prepared to implement public healthcare fees and charges reform (29 December 2025): The Authority’s statement before the reform began on 1 January 2026. Its principles include “Co-payment for those who can afford it and for those with mild conditions”, enhanced protection for poor, acute, serious or critical patients, and the target of “maintaining the 90 per cent overall public subsidisation rate”. It frames why some staff weigh public against private care.
15. Hospital Authority — Hospital Authority implements fees and charges reform (25 March 2025): The Authority’s announcement of the reform. It reports a current subsidy rate “as high as 97.6 per cent”, a new schedule from January 2026, and enhanced protection including “introducing a cap on annual spending of $10,000 for public healthcare services”, a stronger fee waiver mechanism and relaxed means-test criteria. It sets the public-care backdrop for private scheme design.

Insurance products, benefits, fees and regulations change over time, and the figures and scheme rules cited here reflect the sources listed at the time of writing; linked pages may be updated after publication. This is general information only — not personal financial advice, and not a recommendation of any product or insurer. Benefit limits and plan structures quoted here come from one insurer’s published schedule and other sources listed above. They are illustrations, not quotes, and your own terms will differ.

Our policy and pricing documents are client confidential and are shown to clients in full during the advisory process, so you have complete transparency on every option we present. Call +852 3563 9771, email [email protected], or use our contact form to talk it through.