Demand Still Growing For Private Health Insurance

Southern Cross Says Demand Still Growing For Private Health Insurance

Demand for private health insurance continues to grow with New Zealand’s largest provider, Southern Cross Medical Care Society saying today its membership growth in the past six months has outstripped its full membership growth in the previous financial year.

Southern Cross Group Chief Executive, Dr Ian McPherson, said today that in the first six months of its financial year to December 31, 2006, the not-for-profit health insurer had increased membership by 12,756. This six-month growth exceeds by 5,397 Southern Cross’ total membership growth of 7,359 in the financial year to June 30, 2006.

The combination of new members, coupled with lower-than expected cancellations, meant the Society had 821,125 members at December 31, 2006. The growth has put Southern Cross ahead of budget for this financial year, with Dr McPherson saying he’s “quietly pleased” with the result.

“Our membership gains are telling us that that people are acknowledging the value of health insurance, particularly as the realisation sets in that the public system cannot fund everything for everyone on demand.

“Topical issues have kept health uppermost in people’s minds. Southern Cross is supportive of the public health system – it does its job in difficult circumstances. However, we have seen reviews of waiting lists with people returned to their GP’s care. We have seen strikes by healthcare workers with subsequent delays in elective surgery and other forms of treatment. We have seen a trend toward shifting costs from the public purse to individual private patients, such as the lab tests now charged for in the Wellington region. All of these make people more aware of the demands on the public system and they are seeing insurance as a necessity rather than a luxury.

“We also see membership growth as confirmation that we are offering value for money. People are placing a value on being able to access healthcare when they need it. Our core businesses – health insurance and private hospitals – are there to ensure that New Zealanders have viable healthcare alternatives and there is no doubt demand is growing.”

Dr McPherson said people were looking for a higher level of certainty with respect to their health care, particularly in areas such as elective surgery. Health insurance offers that increased certainty, with reduced waits between diagnosis and treatment.

“When people are treated in the public sector they generally receive good care. But people also realise that despite increasing public health expenditure, the public system simply cannot fund everything, especially in areas such as elective surgery. The never-ending demand means waiting lists are inevitable.”

Dr McPherson said higher demand for health insurance and private care was also being reflected in the performance of the Southern Cross Health Trust which independently operates Southern Cross’ hospitals.

“We are making significant investments in expanding the capabilities of our national hospital network to meet increased demand. Expansion projects have been undertaken in Hamilton and Christchurch, we have upgraded our Invercargill, New Plymouth and North Harbour hospitals, and we have a new joint venture hospital at Tauranga under construction.“

ENDS

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