ACCC Private Health Insurance Forum looks at ‘Junk Policies’

We think the 20 Billion dollar Private Health insurance industry is well and truly overdue for a check up.

At the ACCC Private Health Insurance Forum held in June 2016, The ACCC notes;

It is difficult for consumers to understand complex Private Health Insurance Policies, otherwise known as ‘junk policies’ and Health insurance companies are increasingly engaging in anticompetitive behaviour.

Health insurance companies often fail to communicate policy condition changes and how such changes could adversely impact upon the customer.

Did you know that even if you were to take the time to research your policies each year, your policy could be changed midstream making all the research work you’ve done a complete waste of time.

You may not be aware that regardless whether you pay weekly, monthly or annually the health insurance company reserves the right the change the terms and conditions at any time.

Medibank is currently be investigated by the ACCC for failing to inform customers of critical changes their health insurance policies.

You may not be aware of discriminatory rebate practices used by health insurers who have contracted ‘Preferred’ Provider arrangements. This practice means that even though two policy holders may pay the same premium for the same policy – their health insurance rebate amount will depend of whether or not they see a contracted provider.

Medibanks’ recent promotion offering 100% rebate on ‘Check ups’ if you attend their ‘Preferred Provider’ Contracted dentists should be seen as a desperate rear guard action – from a Health Insurer who has finally had to admit they are losing customers. The ACCC notes that consumers are not afforded transparency when it comes to how contracted provider arrangements affect them. These issues not only affect dental care but also Optometry, Physiotherapy and Podiatry.

On the issue of privacy and your health data, Health Insurers are using data from independent health professionals without the practitioners consent so that they can direct customers to their own health funds clinics. Authorities as diverse as Graeme Samuel ex ACCC Chief, the CEO of the Private Health Advisory Commission and Choice spokesman Tom Godfrey have all criticised health insurance with Choice and PHIAC saying ‘extras cover doesn’t make any sense’’.

“Patients are better off paying for extras services themselves and banking the premiums”

From the perspective of long-term health of the dental profession, it would be better if nobody had extras health insurance and instead a simple one to one relationship with their dentist.

You may not be aware that ‘The Big Four’ Health Insurance companies – BUPA, HCF, Medibank and NIB are skimming 22 cents off in the dollar from premiums and have a stake in 73% of the market. Both dentists and patients are well and truly being screwed over with the 22% break off being partially contributed by the dentist in the form of control over fees and much of it wasted on advertising, administration and diversion to either the Insurance companies reserves or to share holders and parent companies.

Choice, March 2016 – “ Unless you are confident of receiving more in benefits than you’re paying in premiums, you should consider dropping your extra’s insurance. Our analysis of extras cover shows low average payout rates and savings of up to 45% available to consumers who drop it”

Important things to remember when you are insured by a ‘For-profit’ insurer

  • These funds are not part of a government organisation like Medicare. They are private companies and they have a simple agenda: to make profit.
  • Their ideal customer is one who pays their premiums regularly and claims as little as possible.
  • Insurance is great for avoiding catastrophes such as life insurance and fire insurance. But insurance for dentistry doesn’t work well for the insurer if there are regular claims. There is no way the insurance company can routinely pay out more than it receives. It’s simple. The patient has to lose. The insurance company has to limit its payouts and restrict its dentists from providing high-end dentistry to its clients. Just like a casino has to win because it sets the rules.

Insurance is usually to cover BIG problems and should pay to cover almost all of your expenses.  Extras cover only covers a proportion of relatively small health costs.  It may be more cost effective to save your Extras Premiums and use the money you have saved directly towards health costs.  Remember that your health funds impose annual limits on how much you can claim.  If you go to a preferred provider practice because they are offering higher rebates, you will reach the limit of what your health fund will cover sooner.   If you are spending more on your Extras Premiums than your receive in rebates it might be time to review your policy and decide whether it gives you value for money.  If you are unhappy with your current health fund, perhaps it is time for a review?

It is hard to see how the involvement of private equity companies in the health sector will be anything but detrimental.

  • At Your New Dentist, we think it is time to refocus on business ethics and the maintaining of integrity to preserve the trust that the public has traditionally placed in health professionals.
  • Your New Dentist is a proud member of the Independent Dentists Network. We are part of a growing network of private practices across Australia who are free from external influence and who are committed to uphold the traditional integrity and care values of past generations who built patient trust.
  • We encourage our patients to turn to the not-for-profit and member owned health insurers. These insurers do not engage in preferred provider arrangements.

The Health Insurance Restricted and Regional Association of Australia (HIRMAA), claims that the Commonwealth Ombudsman data 2010-2015 shows that complaints against the country’s largest for-profit insurers increased by more than 90%. Complaints against HIRMAA member funds during the same period fell by 8%.

HIRMAA’s member funds are growing at twice the pace of the bigger for-profit insurers and are retaining far more policy holders.

Your New Dentist is driven by care not profit. We encourage you to review your current health insurance and make sure you’re getting the best deal possible.

Can you choose your own dentist? Or are you being discriminated against because you would like to exercise your right to choose the provider of your health care.

Your New Dentist is committed to helping you become dentally well again. When you are well, you will have the confidence to take back control of your health and your bank account away from profit driven Health Insurance Companies.