MEDICAL insurance is being arranged for elderly people who want to retire on the mainland but are deterred by high medical costs. The Government has already confirmed that old people will be entitled to receive social security payments across the border from April without a limit on their stay on the mainland. Those who decide to live in Guangdong province will be eligible for social security money of $1,935 a month. But there will be no medical benefits and they will have to give up their public housing when they go. The policy had been criticised as unattractive because the 'unlimited and varied' medical costs in China could become a burden. The Hong Kong Government has asked the International Social Service, a non-government organisation, to liaise with the Civil Affairs Department in Guangdong to work out implementation of the policy with an insurance company. Professor Nelson Chow Wing-sun of the University of Hong Kong said the move would eliminate the risk of overcharging by the hospitals. 'The hospitals may charge more if the patients could reimburse money from the Hong Kong Government,' he said. 'The insurance company could lay down the structure of fees with the hospitals.' Details of the scheme are to be finalised, but Professor Chow said the elderly would be expected to pay about $200 to $300 a month. It is estimated that about 6,000 old people - representing seven per cent of the 100,000 elderly on social security - want to live in China. A spokesman for the Social Welfare Department said the Government had no commitment on subsidising old people's medical bills in China, but said they might ask housing officials to give priority to the recipients in case they wanted to return to the territory. Professor Alex Kwan Yui-huen of the City University of Hong Kong said the policy had come a bit too late. 'The living standards in urbanised cities in Guangdong such as Shenzhen, Zhuhai and Guangzhou are now close to those of Hong Kong, and the state-run elderly homes in Shenzhen have imposed a double charge on them,' he said. A spokesman for the Elderly Rights League, Ng Wai-tung, said social workers had cautioned the elderly about moving to China. 'The relatives who have agreed to look after them may expect something in return, such as some of their social security money,' Mr Ng added.