Australian consumers are turning to the country’s not-for-profit and member owned health insurers for their health cover amid rising complaints against the larger for-profit funds.
Commonwealth Ombudsman data shows that from 2010/11 to 2014/15, complaints against the country’s largest for-profit insurers increased by more than 90 per cent. Complaints against hirmaa member-funds during the same period fell by 8 per cent.
“It’s proof again that bigger is not always better, and it would be in the best interests of consumers to shop around when it comes to private health insurance,” hirmaa CEO, Matthew Koce said.
The Ombudsman’s annual State of the Health Funds Report – released last week – shows that hirmaa’s 19 not-for-profit member funds are growing at twice the pace of the bigger for-profit insurers, and are retaining far more policyholders, with an average member retention rate of 90 per cent for the period 2011-2015.
According to the Ombudsman’s latest figures, the not-for-profit hirmaa member-funds also re-invest 90 per cent of all premiums paid, back into providing benefits for their policyholders – well above the larger for-profit insurers’ average of 86 per cent.
“The not-for-profit hirmaa funds have an excellent record of providing the best quality private health insurance and this is being acknowledged by consumers through this year’s doubling of year-on-year policyholder growth,” Mr Koce said.
“It’s a testament to the not-for-profit member-owned business model that hirmaa insurers are growing twice as fast as the for-profit funds with policyholders receiving the best value for their premium dollar.”
“Not-for-profit health insurers only serve policyholders, not revenue-hungry shareholders and overseas investors. They operate at low cost, on very efficient margins and are able to commit more resources to providing the best quality benefits and access to healthcare services while keeping premiums affordable.”
”The big for-profit insurers need to send profits to their shareholders and overseas investors. Sometimes that involves not only putting up premiums, but cutting back on services covered.”
“Not-for-profit and community based insurers operate in surplus, but only at a level that returns maximum value to their customers.”
“It is important that consumers understand that there is a big difference between the for-profit and not-for-profit insurers. They are not all the same.”
“The strong consumer performance of the not-for-profit hirmaa insurers is backed up by independent research conducted by Discovery Research. An average overall customer satisfaction score of 97 per cent was recorded across the more than 21,000 responses received through participating not-for-profit hirmaa insurers.”
“Whether it be quality of health cover, communication to members, fast payment of claims, value for money or price competitiveness, all the evidence suggests that the not-for-profit and member owned hirmaa funds are leading the health insurance industry,” Mr Koce said.
All hirmaa funds are not-for-profit and member owned, representing more than one million policyholders. To find a not-for-profit hirmaa health insurer go to https://membershealth.com.au/our-funds/
Read the full State of the Health Funds report HERE
23 May, 2016
Download a copy of this media release here: 2016-05-23 State of the health funds Media Release with Attachment