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Health Insurance Numbers Down In First Quarter

Fuseworks Media
Fuseworks Media

Wellington, June 16 NZPA - The numbers of people with health insurance fell in the first three months of the year, due to a traditionally slow period rather than the recession, the industry said.

Numbers insured rose by 5700 in the year ended March 31 to 1.393 million lives covered, but declined by around 4000 between January and the end of March.

"The March quarter is usually slightly negative or flat at best -- it's just because you get cancellations over Christmas but no new policy activity in January really, a lot of that's brokers away on holiday in January," said Health Funds Association (HFANZ) executive director Roger Styles.

Despite the recession and growing fears of job losses, health insurance was something people were reluctant to give up because it was often hard to take it out again on similar terms, he said.

Claims paid in the March year rose 12.9 percent to $712 million, due to both a rise in the number of claims and the rising costs of treatment.

Premiums rose to $837.7m, also reflecting higher health costs.

The industry's loss ratio for the year was 85 percent, compared with the previous year's loss ratio of 79.7 percent when $791.2m was received in premiums and $630.6m paid in claims.

It had become increasingly difficult accessing public sector elective surgery in recent years, partly explaining the rise in claims, Mr Styles said.

"Over the last decade the numbers have been relatively flat, you've seen about 105,000-110,000 elective procedures done each year, but the reality is that population growth and ageing population has been adding about 2-3-4 percent a year to the number that should be done.

"So there's been a huge gap and I think that's something the incoming government has moved quickly to realise."

There was a trend away from comprehensive health insurance toward elective surgical and specialist cover.

"Cost is one factor, obviously, as premiums go up as people age, and one option is to trade down and have some cover for the expensive things and not worry too much about reimbursement for the small things," Mr Styles said.

It was also cheaper now to access primary health care, such as GP visits, as government subsidies had increased.

The association posted a net surplus of $6962 for the year, from a deficit of $3681 a year earlier.

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