Increased use of private health sector may push up premiums
Increasing use of the private sector is driving costs up and putting pressure on healthcare premiums, according to the country's biggest health insurer, Southern Cross Healthcare.The not-for-profit insurer covers more than 840,000 members. Claims for some
Increasing use of the private sector is driving costs up and putting pressure on healthcare premiums, according to the country's biggest health insurer, Southern Cross Healthcare.
The not-for-profit insurer covers more than 840,000 members. Claims for some of its most common procedures have significantly increased during the past two years, according to new figures released today.
The cost of claims has jumped 10% for the year ending December 2009. This follows an 8% rise the previous year.
Southern Cross chief executive Dr Ian McPherson said the relentless demand coupled with higher healthcare costs was putting enormous pressure on premiums.
"Southern Cross is paying 96c in claims to members for every dollar they pay in premiums. With healthy reserves we are able to absorb this cost and budget for a deficit in the current financial year."
Dr McPherson said this kind of deficit was not sustainable.
Southern Cross was looking at ways to address the problem, including strengthening its affiliated provider networks.
Some high-volume procedures, such as colonoscopies and cataract extractions, may be moved to be covered by an affiliated provider only.
Dr Ian McPherson said alternatives were to reduce access to these services or put premiums up.
"We believe these would prove to be less palatable options for members and healthcare providers in the long run."
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