Health funds sink fangs into insured

HEALTH fund premiums are soaring while the rebates members get are shrinking — with many consumers better off ditching their cover, an angry Australian Dental Association claims.

Rebates for dental care have dropped $1 per service even though health insurance has been rising two and three times the inflation rate.

This means health insurers are ripping off their customers by collecting 23 per cent more in extras premiums than they pay out in benefits, the Australian Dental Association says.

Many people would be better off setting up a savings account to pay their dental bills, the association’s president Hugo Sachs said.

Government data shows the average dental benefit paid by health funds in December 2015 was $65, in December 2016 it fell to $63 and in September 2017 it was $64.

The association has told a Senate committee official that government data shows health funds collected $27.1 billion in premiums for extras cover between 2011-12 and 2015-16. But paid back just $20.1 billion in benefits.

“When you look at the gross profit of insurers it’s 14-16 per cent and that means out of a $2000 insurance policy, $300 a year is not being paid back to the insured,” Dr Sachs said.

“I haven’t had ancillary cover for 37 years. I worked out it was a waste of money because of the number of exclusions and annual limits. I’d ask people to look at self-funding.”

Dentists are fuming over moves by health funds to encourage their members to use preferred providers. They do this by paying higher rebates to preferred provider dentists.

The association is urging the government to change the law to stop this.

“This is grossly unfair to patients, particularly if they do not have convenient local access to a dentist contracted to their health fund, as is the case for many consumers living outside major metropolitan areas.

“The ADA believes that it is also anticompetitive.”

Private Healthcare Australia chief executive officer Rachel David said the amount health funds paid out for dental care had been rising every year, but there is no evidence of a downward trend in dental benefits.