Those that have been reading my blog and social posts on a regular basis will have seen I’ve got a particular bee in my bonnet about unfunded medicines. Partly driven from my view insurance advice needs to improve but also ensuring you have access to the best treatment possible when you really need it the most.

This blog article was updated and reposted here on the 3rd of October 2016. I have left this here for comparison purposes to show the impact of Sovereign's announcement on the 30th of September.

As I wrote in this article, unfunded medicines the real risk to you, if you’re a Southern Cross policy holder you have about a 6.3% risk that if you develop cancer you’ll have to find money to pay for your cancer treatment. If you’re with another provider who doesn’t have any contribution to your unfunded treatments, you’ll have a 15% chance you’ll have to contribute to your treatment.

One of the things that is often said, reported in the news, and generally complained about are the increasing costs of medical insurance.

We've heard about Southern Cross policyholders up in arms because of the premium increases they have seen. To be fair, all providers' premiums increase; Southern Cross has the biggest pool of clients and the oldest pool of clients, so increases do hit hard in that particular group.

This article has been updated here, and this one has been maintained for historical reference.

Mobile phones, those funny devices that used to be the domain of yuppies and annoyed those looking for a quiet dinner out, now we can’t get by in life with out one.

The expectation is you’re now available 24/7 and your smart phone will substitute all manner of thinking requirements.

We’ve heard plenty about mobile phones and driving, yet people still hold their phone while driving. No, holding it in your hand on speaker phone is not hands free ;) ahh, it’s still in your hand!

Though, they are causing all manner of distractions, and my couple of weeks driving an electric vehicle highlighted this, as I nearly mowed down at least 6 or 7 ambling pedestrians.

There's an undercurrent philosophical debate going on just behind the screen. At present, you're unaware of it, unless you're already in the health system as a patient or a doctor. This undercurrent defines what treatment is available to you and how much the government is prepared to spend their budget on you.

It might sound crass to put a number on the value of a life, unfortunately, in the world we live in, money talks, you know the rest.

Also, for leukaemia too, if the commentary in the media is to be believed. This new medicine on the market, approved for use in New Zealand, is currently not funded. The indications from the commentary, this medicine is one of the only options for melanoma patients to be successfully treated. 

I am not clear on the survival rates, but the results to date appear to be miraculous when standard chemotherapy has been less than useful in treating melanoma to date according to the many articles on the subject. The problem is the cost, somewhere in the region of $300,000 over two years to access this new treatment.

The New Zealand Herald kicked off their five-part series on cancer today. Martin Johnson investigates the controversies in cancer testing and treatment and the moving stories of people diagnosed with cancer.

I've mentioned many times, here in my blog and many times to clients and frankly anyone who will listen, that our public health system, while good in many areas, often falls short in many others.

Managing medical expenses is a large area of risk management. It is also an area where people often don't spend a lot of time. Public health is an area where the government spends the most ($15 billion for 2015), which should be an indicator that you need to consider your options here as well. 

Medical Insurance Treatment Myths and Realities

My share of my blog post on Movember got a really good reply with some well thought out points that I come across with clients every day. Some are well founded and understood, others things have changed as has the approach. I felt it was worth a blog post by itself.

Susan’s original post:

Good on you Jon-Paul, admirable cause, but it is my view that Health insurance company don't do Health prevention, you have to pay for this type of health service even if you have a mastectomy your health insurance won't pay for a re-build for want a better word, apparently its plastic surgery and its not covered to have you looking normal after going through harrowing surgery and treatment...

When the subject of medical insurance or cancer treatment comes up, the discussion on non-Pharmac medicines usually follows.

What are non-Pharmac medicines?

Non-Pharmac medicines are where the government does not fund the drug or treatment being prescribed or recommended for a treatment and you will have to find the money to pay for it.

It does not matter what the stats are, if you are someone who needs a treatment and the government does not fund it, you want to be able to access it. Which is why, dollar for dollar you take the medical policy with coverage over the one that does not, even if it is a bit more expensive you probably still should.

Ok, I have raved about this in other blog posts. I have had an idea, a general concept, that access to medicine was becoming a problem—a real problem—with one of the four pillars of New Zealand society: Health, Education, Justice, and Social Support.

Now with this latest report, there is a clear indication we’re well behind with Health funding. Education, Justice and Social support all have their challenges, I am sure, but Health is an area I spend a lot of my time working with on behalf of my clients.

Breast cancer, or for that matter any form of cancer, with women gets a reaction in the media. Breast cancer has certainly been the one that has had the majority of attention over the years.

In 2003, there were large headlines about access to Herceptin and its costs, especially as the Aussies had access to it from an early stage.

• Here in NZ, the budget at the time just didn't have the capacity to handle the cost.
• On the insurance side, there were only two medical insurers at the time able to offer cover, one that stopped not long after Herceptin hit the market, leaving 1 insurer providing non-Pharmac cover for new policies for nearly 10 years.

Now that we've got over most of the funding discussion on herceptin, it's partially funded rather than fully funded; other areas around cancer treatment are getting attention.

The health system is a bit like public transport. Something you take if you have to, but something you'd rather avoid. And just like the bus, it can be a pain to catch, sometimes it's right on time, most of the time it's full or you just plain old miss it.

Today's health system is markedly different from what it was even 5 years ago. It's starting to look like it's being rationed rather than provided as a free public service.

These articles highlight the plight of those subject to waiting for the public health system:

Roy Morgan Research has published updated information on insurance coverage in New Zealand and it is not a particularly pretty picture.

What does it really look like out there in New Zealand?

Almost 1 in 7 Kiwi’s do not have any insurance cover at all. I don’t know about you, but 1 in 7 people I know are not financially independent enough not to need insurance cover at some level. This suggests Kiwi’s are taking the risk that ‘she’ll be right’. This may be knowingly but most likely unknowingly.

This is a question often asked by clients, especially those with medical insurance.

Inflation loosely termed is the change in buying power $1 has today vs. a point in time in the past. The Reserve Bank is under instruction from the government to keep this in a band between 1% and 3% per annum.

The best lever for the Reserve Bank to use to manage this is the interest rate, which is why it gets a lot of focus.

Inflation rates help drive the decisions the Reserve Bank makes on interest rates. (In a very simplified way)

What does this really mean?

Good question as most people struggle with an example of a disability that is not a trauma or an accident. A degenerative back condition is one, no event as such so not ACC. Though there is another, I have seen which was more surprising.

Who would have thought a change in regular management medication would result in not being able to work? Well it can happen, not only once but a recent clients father has had a similar experience too and the similarities are quite surprising. Let’s just call them both Peter.

There are a number of ways to insure babies and children. Let us start at the beginning, pregnancy and conception.

In New Zealand currently, assistance with conception is limited to what is publicly funded. Private medical insurance does not cover conception issues; it can cover some pregnancy issues though.

What can you have covered once you are pregnant?

The public system is well equipped for dealing with pregnancy. It is unlikely you will need additional assistance that requires funding if you have a normal pregnancy.

If you do have complications with your pregnancy, then there are provisions under most medical insurance policies specialists and tests benefits to assist with private specialist costs. What you do need to consider are the finer points of the policy, this is where your adviser comes in.