Federal government health insurance reforms, submitted to parliament this week, have been welcomed by regionally based health insurer Queensland Country Health Fund (QCHF) as a win for consumers.
QCHF CEO Aaron Newman says the package of reforms delivers increased flexibility for insurers to provide improved value through lower premiums and a wider range of benefits, especially for those in regional locations.
“For a reasonable period of time now consumers, especially those in regional locations have been voicing their concerns regarding the value of health insurance.
“This suite of reforms is a good first step to address this and is great news for policyholders, particularly younger people and those living in our communities,” Mr Newman explained.
The proposed changes include the option of offering younger people premium discounts if they take out a policy before their 30th birthday, providing insurers with the ability to assist with travel and accommodation and reducing wait times for accessing full benefits.
Queensland Country Health Fund CEO, Aaron Newman says the fund is already considering a drop in premium costs for younger consumers as well as significant advantages for policyholders across regional Queensland.
“People living in regional areas potentially receive less value from health insurance if they have to incur travel and accommodation costs to access specialised treatments in metropolitan areas.
“Under the reforms insurers will now be able to provide travel and accommodation benefits for those people, which improves access and affordability for people in regional and rural communities.”
The reform bill has also addressed health insurance complexity and will improve consumer transparency by removing the use of benefit limitation periods in policies.
“Policies which include treatments for things like hip replacements, weight loss surgery and mental health care currently apply up to a two year period to access full benefits but that will be removed.
“This change will give policyholders access to full benefits sooner for these treatments and removes confusion about the extent of treatment coverage.”
Newman said the best part of the first stage of these reforms was that they would not have any negative impact on QCHF policyholders.
“While the reforms require some changes to our products, at Queensland Country Health Fund, none of these will have a negative effect on our policyholders.
“Premiums will not increase above the normal annual increases and new initiatives like increased excesses will be available to provide consumers with lower premium options,” he said.
While the next premium increase due to hit consumers from April 01 is the lowest in 17 years, Newman acknowledged there were challenges ahead and more work to do with government reform.
“The widely published chronic disease epidemic hitting Australia is placing increased pressure on health services generally and that inevitably plays a role in the cost of insurance,” he explained.
“Unfortunately Australia’s entire health system is under pressure as a result of the obesity epidemic with more than 63% of the population assessed as either overweight or obese.
The government regulator, APRA has recently acknowledged that increases to hospital and medical costs are driving up premium increases rather than insurers seeking higher profits.
Around 70% of obese adults are likely to suffer with one or more chronic conditions such as heart disease, stroke, musculoskeletal diseases, hypertension, type 2 diabetes or impaired social functioning that increases their health care cost by at least 30%.
Mr Newman applauded the government’s recent steps to address the supply costs in the industry with reductions to the cost of some medical devices but says more reform is needed.