Southern Cross are going to try and implement an open contract
strategy (currently being successfully practiced in the UK), which is open
referral whereby members ring Southern Cross and they give a list of health care providers, this
way there can be some restriction on the overpriced providers mentioned in part one as a drag on the New Zealand health insurance industry. The problem is that currently, the GP refers the patient to a specialist of their choice for
whatever reason they choose. It could be that the GP thinks they are the best choice what
they do, but it could also be that your GP plays golf with the neurosurgeon and
he thinks he’s a great golf player. There is nothing in place in the current system to stop this from happening,. Southern Cross mentioned that unfortunately some of us can be passive and just go with what our GP
says, no questions asked. How many of us actually research the specialist or ask for a portfolio? How many of us ring around for a second opinion? Also, as mentioned in Part One, people tend not to care about prohibitive costs when it is 100% covered by the insurer. They are somewhat unaware in this regard that if this problem of overcharging could be addressed, the insurance companies would have more room to lower premiums or offer more competitive rates, which would benefit them directly.
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| Southern Cross are implementing initiatives to counter overcharging and pass the savings on to the consumer. |
In another forthcoming initiative, Southern Cross wants to
gather patient information so that a
Portfolio on specialists/surgeons can be available for members to actually read
about the impending procedure from real
people and real cases. This portfolio will divulge
success and failure rates, return visits to hospital because procedures haven’t
worked, infections caught whilst in
hospital and all the relevant
information that patients should have access to. This could save
money, preventing procedures having to be repeated at Southern Cross' expense. When repeat procesures occur, it was detailed to us that getting the money returned to them involves the insurer battling ACC for medical misadventure as ACC doesn’t willingly pay
over the money. Last year, Southern Cross got $6 million
recuperated but this was not enough to cover the extra expenditures and costs associated with repeats of procedures.
·
We were informed in the presentation by Lars Bojsen-Moller that Skin Claims have risen
33% from last year, totalling 47,000 skin claims and $40 million paid out. One of the reasons for this is that GPs aren’t doing what
they could be doing. They are
sending the patients to a skin specialist at a cost of $1500 when in some cases the
doctors are very capable and more than
qualified to carry out the same procedure for $400. When this happens many times it leads to a huge increase in costs which Southern Cross has to pay in claims.
Lars concluded his presentation with a point aiming to make us aware that some health insurance companies don’t word their policies correctly. You can think that you are covered for something but end up not being covered. This is something that clients who go it alone with their insurance have to be aware of and practise extra diligence, or use a broker such as ourselves who have the knowledge to avoid these possible pitfalls and get you just what you need. Wrapping up his presentation, Lars reminded us that Southern Cross have a lot of changes coming up, which hopefully should benefit their ability to give clients better deals on their health insurance and better care. We will keep you informed when these changes come into effect and how they might benefit your personal insurance. As always, if you have an enquiry or you want more information, send us a question at enquiry@sprattfinancial.co.nz or by phone at (09) 307 8200.
