Is private health insurance worth it?

Kiwis expect our health services to be funded by the taxpayer. And, for the most part, that’s what we get. So why are thousands of New Zealanders choosing to pay for private health insurance?

people-431943_1280-800x570 Many people assume that when they need it, either ACC or the public health system will cover them. And that is mostly true for injuries or urgent medical problems.

But for those with non-urgent conditions public healthcare is less certain, and that’s when people with private health insurance really experience the benefits of having private health cover.

Sometimes the public system falls short

In August, The Press newspaper reported the story of a woman who had to take out a loan for $20,000 to have her shoulder surgery done.

A simple manoeuvre – reaching down to pick something up – cost Christchurch woman Jackie Simons dearly when she injured her shoulder to the extent that she had to give up work. Simons had no faith an ACC claim would be accepted and her surgeon couldn’t promise the hospital would have the capacity to carry out the $18,455 surgery she needed.

With no health insurance, Simons had to weigh up the cost of taking out a loan versus not being able to work or pay her mortgage. She decided that not having the surgery was a false economy and elected to take out a loan for $20,000 to cover the surgery herself.

Can you afford not to have private health insurance?

Around 1.34 million Kiwis – nearly 30% – have private health insurance. While many people cite cost as the reason they don’t have health cover, they often fail to weigh up the costs they or their family would face in the event of an injury or medical condition. The main advantage of private health insurance often lies in cutting down the wait times of the public health system.

How much of a wait are we talking about?

One study found that in the public system, the average time from the first GP referral to having surgery was 224 days, while those going private would generally be seen by a surgeon a couple of weeks after the first visit. The surgery could be done and you would be back at work before the public system will even see you.

ACC only goes so far

Most people assume that if they are injured as the result of an accident, ACC will cover them. While ACC does provide cover for injuries and rehabilitation as a result of accidents, in some cases they don’t cover the whole cost of treatment or may decline the claim altogether. In these situations, people with private health insurance are able to receive the treatment they need.

Health insurer nib recently covered a claim where the client would not have otherwise have received the treatment she needed under ACC:

A young mum was lifting her child’s pram into her car when she suddenly felt a click in her neck and then noticed numbness and tingling develop down her left side. She was diagnosed with a cervical sprain of the neck and recommended physiotherapy. ACC accepted the claim for this.

However, after a couple of weeks there was no improvement and she was referred to a specialist and given and MRI. This showed she had a disc herniation at several levels in her cervical spine and surgery was recommended.

Unfortunately, the surgery was declined by ACC.

Luckily, the young woman had private health insurance and was able to get the $40-50,000 surgery much faster than if she had to wait on the public health system.

Be sure you can access healthcare when you need it

Figures gathered from DHBs show that nearly 45,000 Kiwis had referrals to see a specialist declined in 2015.

And there are many other patients in the same situation. With the demand for public healthcare exceeding supply, thousands of people are missing out on publicly-funded surgery.

Tough decisions are having to be made every day by our DHBs to ration healthcare services. While people expect that if they have a need they should be able to access the appropriate care, the reality is that some people who are in pain are missing out on surgery that would help them.

In many cases, people without private health insurance are having to live with a painful or debilitating condition that could be treated.

Do you really want that to be you?

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