News release
14 September 2012
Demand For Private Healthcare At Record Levels
Southern Cross Medical Care Society released its Annual Report today, highlighting over $600m worth of healthcare
services funded in the 2012 financial year. This included the funding of 171,000 elective surgical procedures, up from
158,000 in the previous year.
108,000 members underwent one or more surgical procedures funded by their Southern Cross health insurance. This
included:
· 1600 hip replacements
· 6200 cataract surgeries
· 16,200 colonoscopies
Members’ claims for non-surgical elective services included:
· 674,000 GP consultations
· 50,000 ultrasound scans
· 12,000 MRI scans
For every $1 of premium income, 85.7 cents was returned to members in claims for healthcare treatment.
Southern Cross Medical Care Society Chief Executive Officer Ian McPherson said non-public funders like Southern Cross
provided significant relief to the public sector, by freeing up resources for emergency, acute and community health
services.
“Despite a tough economic climate and the absence of any financial incentives to insure, 1.35 million New Zealanders
choose to make provision for their own elective healthcare needs through health insurance. They place a high value on
the knowledge that should they require care they can access it without delay and undue financial burden.”
McPherson said in the future, taking personal responsibility to fund elective healthcare needs will be even more
necessary.
“Although the number of elective surgeries provided by District Health Boards is at record levels, so too is the demand
for these services. This rising demand is being echoed in the private sector.”
For example, between April 2007 and March 2012, the number of orthopaedic procedures funded by the Society increased by
26% - though total membership remained static over that same period.
“Health budgets are coming under increasing pressure as the population ages, chronic conditions become more prevalent
and treatment options expand. For the public system to remain sustainable, a significant change is required in how we
pay for and provide non-urgent healthcare in this country.”
McPherson said, “Those with insurance are now prepared for this reality, and nearly all Kiwis should be. The country
needs them too. This will necessitate a shift in thinking and a letting go of long-held expectations around what the
public purse can reasonably be expected to deliver.
“New ways to help New Zealanders save for the costs of non-urgent healthcare will be required, as has happened with
saving for retirement. Healthcare is not cheap - a cardiac bypass in private will set you back between $38,000 - $60,000
and a hip replacement between $18,000 - $28,000.”
The 2012 financial year saw the Friendly Society in a strong and stable financial position, while continuing to deliver
good value to its members.
In February the Society retained it’s A+ (Strong) financial strength rating from Standard and Poor’s for the tenth
consecutive year. At year end the Society’s reserves equated to around seven months’ worth of claims costs.
Lower claims in the first half of the year resulted in a higher-than-planned surplus of $39m. This surplus will be used
by the Society to mitigate future premium increases, to increase policy benefits and to maintain reserves at appropriate
levels.
The Society’s market share held steady at 61%, and the number of members on employer-subsidised schemes also remained
level with 2011 numbers.
“Against a tough economic background, employers are very aware that helping people stay well and get both the day-to-day
and elective medical treatment they need quickly is key to productivity. But it’s not all just about the bottom line –
businesses care about their employees and want to support their health,” said McPherson.
Reflecting an industry wide trend, the number of members decreased 1.6% over the year to 822,422.
Southern Cross Medical Care Society’s 2012 Annual Report can be accessed
http://www.southerncross.co.nz/Portals/0/Group/Corporate/2012%20SCMCS%20Annual%20Report.pdf
Number of Southern Cross-funded surgeries by region* for 2012 financial year
Region
Number of Surgeries
Northland
4126
Waitemata
33901
Auckland
30290
Counties Manukau
17257
Waikato
11917
Bay of Plenty
11086
Lakes District
3232
Tairawhiti
982
Taranaki
3714
Hawke's Bay
3371
Whanganui
1789
Midcentral
3987
Wairarapa
932
Capital and Coast
11343
Hutt
4576
Nelson Marlborough
3359
Canterbury
17726
South Canterbury
1100
West Coast
256
Southern
5997
170941
*Regions determined by District Health Board boundaries
ends