Frequently Asked Questions

Managing medical expenses and avoiding waiting lists

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 managing.

Public health is an area where the government has the second largest spend $28.5 billion in 2023, which should be an indicator you need to consider your options here as well.

Public Spending:

The government has been adding to the budget for Health in recent times, but it is not keeping up.

• In 2015 the spending on health care was about $15 billion.
• By 2019 that had risen to $18.3 billion
• A jump of $5 billion to $27.8 Billion in 2022
• With year ahead forecast to exceed $30 billion.

Effectively doubling our public health spend in 10 years, and it's still not enough!

Medical Service in New Zealand, Public & Private

Our Medical Insurance Blog Section is a good place to start with understanding what is happening in this area

Medical insurance can be very specific for people. Some policies can be very good, others not so much, depending on what you expect from them and your situation is.

• This article, Waiting lists are a form of rationing, discusses waiting lists.
• This article, Insurance coverage in New Zealand how will it affect you, discusses the impact of people having less private medical insurance and the pressure it creates on the public system. This article, Retirement Commissioner warns NZ Super changes needed in 15 years, evidences some of the things I have discussed in the coverage for NZ article.
• This article, How do you insure your new baby, discusses insuring your new baby.
• The New Zealand Herald's 5 part series on Cancer, Breast Cancer, Bowel Cancer, Lung Cancer, Melanoma, & Prostate Cancer. 
• this article, Pharmac funding do you really understand what this means?, discusses the role of Pharmac and how medicines are funded and what this means for you when they are not funded.

Get access quickly

In real terms, medical insurance is about getting you access to medical treatment as quickly as possible.

• If you have an accident or a life-threatening situation, calling an ambulance and getting treatment in a public emergency room is the best place for you.
• Private hospitals in New Zealand don't handle emergency medicine.
• Once you are stable and emergency discharges you, access to medical treatment, if you still need it, becomes a bit daunting and potentially a bit frustrating.

Maintain quality of life

There is a growing feeling that waiting lists do not represent the full picture of need.

• There is a growing body of evidence that a significant number of people needing treatment for non-life-threatening conditions are just not getting treatment.
• It's become too hard for them.
• They may have started the process with their GP but have just given up waiting to get to the next stage, and their condition is perceived as one that doesn't warrant the hassle.
• Regardless of severity, this affects quality of life.

This is where medical insurance can help, yes it costs money and at the lower end of need and treatment it may well be cheaper to just pay your own way.

• This tends to be true for GP costs and Prescriptions, where we often see people paying more for GP and Prescription coverage than they ever claim.
• Often because they pay for the insurance but don't bother with the claim.
• It is probably better to spend the money on a good surgical policy and continue paying for GPs as they have been.

Manage expenses

There are a significant number of people on 80% medical plans, which don't feel bad to start with.

• 80% of GP costs are covered, and paying $80 towards a $400 specialist consult isn't too painful.
• At the more extreme end of the scale, for say a heart bypass, it starts to hurt financially.
• This is where a lot of people with an 80% medical plan end up getting treatment in the public system; it's become too costly to go privately.

Having a good 100% coverage plan means you can be assured your treatment costs will be covered.

• If you can sustain some costs, introducing an excess can help manage premiums and contain these costs.

Cardiac Care

This is one of the significant reasons you have medical coverage.

• With a heart bypass currently costing between $35-50,000, finding $7,000 to $10,000 on an 80% medical plan to go private becomes financially challenging for a lot of people, and they wait for the public system to get to them.
• This is risky at best, life-threatening as a minimum.

Getting treatment quickly is why you have good cover, you shouldn't have to have a heart attack to get looked at quickly, as often happens.

Cancer Care

The other significant reason you have medical cover.

• If you are looking at cancer treatment, then it gets even more costly.
• Chemotherapy can cost between $15,000 and $200,000 per course, depending on treatment required and whether it is funded or not.
• Some medical policies don't cover unfunded medications, and our largest medical insurer has only a small contribution to unfunded medications.
• Our five main insurers will pay for unfunded cancer medications; yes, Southern Cross is included, but you may have to specifically request the extra cover.

You shouldn't have to get a mortgage on the house or fundraise to pay for this.

Pre-Existing conditions

Unfortunately unless you have access to an employer medical scheme, getting cover for pre-existing conditions is unlikely.

• Being an existing known risk, the insurers will tend to want to avoid covering these, being focused on insuring the unknown.
• If it's known, then it will be excluded. Keeping in mind that if it is an existing managed condition, then this possibly isn't what you need to worry about; the two C's above are probably more important to focus on.

With trauma policies on the market covering up to 60 conditions and paying around 95% of claims for Cancer, Cardiac, Stroke, and Kidney conditions, the focus is more on the severe end.

Right Time

Medical insurance enables you to have your treatment done at a time that suits you.

• With less life-threatening procedures, this means you can manage your treatment within your lifestyle.

Teachers are a great example, fortunate to have a large amount of time off in summer. Medical insurance claims for teachers spike once school is out for the year.

• Surgery is often scheduled and completed in December, with a good 4-6 weeks to work through recovery.

Right Person

Do you want to go to the best cardiologist, or do you want to avoid a trainee doctor under the specialist? With medical insurance, you can.

• Yes, in the public system, you may be under Dr X, but it is likely most of your care and treatment will be taken care of by their residents rather than them directly.

With medical insurance, you can be treated directly by Dr X.

• If your condition needs a specific specialist rather than a doctor consulting that specialist, you can get treated by them.
• If you need a second opinion, many medical insurers now include provisions to pay for second opinions.

Right Place

You have the choice of venue for your treatment, too. Within reason, for availability and also where your chosen specialist or surgeon works.

Reasonable & Customary

All of this is wrapped up with reasonable and customary.

• This is insurer speak for what is reasonable for the costs of your treatment and the condition you are being treated for.
• This is where working with your adviser to work through what is going on and getting prior approval is important, to ensuring you have no surprises or unexpected expenses.

If you want to have a frank conversation about insuring your medical expenses in the way you want them covered, give us a call.

We'll step you through the options and discuss the pros and cons in plain English.