Many New Zealanders have their Medical/Health insurance cover through Southern Cross Healthcare. Southern Cross Health Society (a charitable trust) has been around since 1961 and has traditionally provided Health Insurance through the workplace.
There are a range of health insurance policies offered, from KiwiCare and RegularCare (which are the base plans) to Ultracare 400 which is the rolls royce of cover. Many of these plans give some reimbursement for GP and prescription costs and day to day costs, but traditionally only provide coverage for large medical cost items up to a scheduled cost or a % of the total cost.
Over the years, other insurers have offered health insurance which focuses on providing full cover for the large ticket items (hospital procedures, certain specialist treatments, and some policies provide cover for non pharmac funded drugs).
Moneyworks generally recommends that clients put in place major medical/health insurance with specialists or tests cover. This then provides a payment for the big expense items and you can reduce the premium by having a higher excess.
However, some people are unable to move from their existing Southern Cross Healthcare insurance policy because of pre-existing conditions. This means that if you are one of these people the changes just announced by Southern Cross Health could impact on you.
What are these changes?
At the end of October, Southern Cross announced that they were making a number of changes to the benefits on its health insurance policies. These will become effective on 10th December 2018. Some of the changes include:
The insurer will no longer provide a $30 per night public hospital cash allowance,
sleep apnoea treatment
$600 funeral allowances on almost all policies, as well as either cutting obstetrics allowances altogether, or reducing them.
Some policies have also removed chiropractor and osteopath treatments, while there are instances of excesses for specific treatments increasing.
The RegularCare Budget policy will see its excess increase from $100 per claim to a minimum of $500 per claims year. If the cost of treatment is $1000, the policyholder will pay $700 - $500 excess plus 20% part-payment contribution of $200 - and Southern Cross will cover $300. Before the change, the policyholder would pay only $300 in total.
The UltraCare and UltraCare400 policies shrink the current obstetrics allowance ($2500 per claims year) down to $1000, as well as remove a number of other benefits previously available to policyholders.
To find out what the specific changes are for your policy - checkout the table on the Southern Cross website, by clicking here.
For example, for a RegularCare plan (a common plan for many members) - these things have changed:
- Skin lesion services are now covered under one benefit. This means that the previous total of claims of up to $10,800 pa and $35 per consultation with a GP is now changed so that there is a maximum of $5000 in claims per year.
- Eligibility criteria change A change for eligibility for Mohs surgery (which relates to skin lesions)
- New visit limit for specialist consultations Now a maximum of 5 specialist visits per year, with a maximum payment of $4,000
- Removal of benefits. These benefits are no longer covered under this policy.
- Public hospital cash allowance.
- Uvulopalatopharyngoplasty (UPPP) - a surgical procedure for sleep apnoea.
- Obstetrics allowance.
- Funeral allowance of $600
- Chiropractor and osteopath services.
Guaranteed Policy Wording
In recent years, the main insurer that we have recommended for medical insurance has what is called 'guaranteed policy wording'. What this means is that you know that you will always have the policy wording on the contract that you signed up for (just like with the AMP, Sovereign and OnePath Life contracts), but also that if better policy wording is introduced in the future, this will be applied to all contracts.
This means that you can't lose the policy wording that you signed up for - which is very important when you look at the changes that Southern Cross have just made.
What can you do if you want medical/health insurance or have an existing Southern Cross insurance policy where the wording is being changed?
Moneyworks subscribes to independent research on the insurance policies that we recommend to clients, which details all of the benefits of policies that are available. We can also do a 'head to head' analysis showing you how your existing health insurance policy compares to any new policy. However, if you have significant health issues that are already covered by your Southern Cross policy, you might be best staying with that policy even with the changes. But, your existing health issues might be minor compared to the benefits that you will gain by changing your policy.
If you want to investigate the options for getting new health/medical insurance cover, or moving from Southern Cross to an insurer with better policy wording, email us at firstname.lastname@example.org