Not­for­profit health in­surer’s an­nual sur­plus sinks 81% as claims out­pace in­come

Otago Daily Times - - Business & Money - SO­PHIE BOOT

AUCK­LAND: Not­for­profit health in­surer the South­ern Cross Med­i­cal Care So­ci­ety has seen its an­nual sur­plus drop 81% as an in­crease in claims out­paced ris­ing pre­mium in­come.

The Auck­land­based mu­tual posted a sur­plus of $6.8 mil­lion, down from $35 mil­lion a year ear­lier when rel­a­tively flat claims led to a jump from a $5.8 mil­lion sur­plus re­ported in 2015.

In­come from pre­mi­ums rose 6% to $923 mil­lion, the fourth year in a row that pre­mium in­come has risen by about 6%.

That out­paced a 4% in­crease in mem­ber­ship to 853,160 mem­bers.

It paid out about $830 mil­lion in claims in the 2016 fi­nan­cial year, com­pared with $749 mil­lion a year ear­lier, a rise of 11%.

Ninety cents of ev­ery dol­lar paid in pre­mi­ums went on mem­ bers’ treat­ment, up from 86 cents the pre­vi­ous year.

It has re­serves of $441.3 mil­lion.

Chair­man Greg Gent said that South­ern Cross had in­vested in dig­i­tal tech­nol­ogy over the past year, and more than 80% of its claims were now sub­mit­ ted elec­tron­i­cally.

‘‘We’ve seen ro­bust growth across a num­ber of sig­nif­i­cant ar­eas and have con­tin­ued to en­hance the way mem­bers can in­ter­act with us via dig­i­tal tech­nol­ogy,’’ he said.

The com­pany had in­creased the num­ber of its easy­claim providers by 35% to 2171.

The num­ber of af­fil­i­ated providers con­tracted with South­ern Cross for health­care ser­vices rose to about 1850 from about 1300 the year ear­lier, re­sult­ing in sav­ings of about $35 mil­lion for the 2016­17 year, it said. — SCOOP

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