Amidst increasing healthcare issues, unhealthy lifestyle and environment and rising medical costs, health insurance is gaining importance covering the treatment cost for the private hospital patient, or for out-of-hospital healthcare services. In Australia, Medicare covers 75% of the Medicare Benefits Schedule (MBS) fee for the treatment as a private patient, whereas health insurance covers 25%.
Medicare doesn’t cover:
- The treatment at a private hospital of patient’s choice by a doctor of choice.
- The health services- physiotherapy, optometry, podiatry services. Including the cost of some medicines and medical devices.
Given the above, individuals often opt for private health insurance policies, in the following options-
According to the insurance policy opted, the private health insurance pays the costs of the treatment in the private or public hospitals; policyholders can choose doctor and hospital by their convenience. Private health insurance also covers the cost of physiotherapy, dental and optical, which is not covered under Medicare.
Let us look at some of the benefits of Private health insurance over public health care cover with respect to the following health services-
- In-hospital services- Being a public patient, one does not have an option to choose the doctor, hospital or any specialist. However, the case is different for policyholders of private health insurance, and the health insurer will cover all the cost of treatment by the hospital or doctor chosen by the patient.
As a private patient, the policyholders have the option to choose the health care related services accordingly.
- Prescription medicines- The cost of prescription medicine is covered by the Pharmaceutical Benefits Scheme (PBS) in public health care system; and in private health insurance, one can choose policies that cover some prescription medicines which are not covered by the PBS.
- Prostheses- In public health care, the costs of implanted prostheses are covered; private health insurance will also cover some or all of the prosthesis cost itself if the policy covers the procedure to implant a prosthesis.
Want to know more about private health insurance; Do read A Report On Private Health Insurance: What You Should Know
nib Holdings (ASX: NHF) offering health and medical insurance to ~ 1.6 million
An ASX listed insurance service provider, nib Holdings Limited (ASX: NHF) is an international health partner who is engaged in providing health and medical insurance to Australia and New Zealand citizens. The company offers health and medical insurance to approximately 1.6 million people staying in AU and NZ, including nearly 190,000 international students and workers in Australia.
Moreover, the company is the 3rd largest travel insurer in the Australian region and a distributor of travel insurance at global level; with the business nib travel it provides financial security and assurance to the travellers across the globe.
nib Holdings Limited operates the following business divisions:
nib announces lowest premium change in 17 years
nib has received approval from the Federal Minister for Health to increase insurance cover premiums for nib health funds by an average of 2.90% across all products, effective 1 April 2020.
Lens through Joint venture initiative between the nib and Cigna Corporation
In an ASX announcement on 6 December 2019, the company unveiled about the joint venture initiative between nib and Cigna Corporation. Both of the companies will contribute approximately $10 million in the start-up funding, and this joint venture will be operated by nib. This venture would be led by nib’s Australian resident’s health insurance business group executive Mr Rhod McKensey.
The global health service company Cigna Corporation is engaged in improving the health, wellbeing and peace of mind of the person to whom it serves. The subsidiaries of the company including Connecticut General Life Insurance, Cigna Life Insurance company of New York, Cigna Health and Life Insurance, Express Scripts companies or their affiliates and Life Insurance company of North America are exclusively involved in providing the health insurance products and services.
The primary purpose of this joint venture is-
- To analyse and interpret underlying individual disease risk;
- To provide guidance on how the risk can be controlled, treated, avoided or mitigated;
- To deliver health care programs, facilities and interventions relevant to the disease risk profile.
It is anticipated that the joint venture would partner with other health care insurers & payers as well as the providers of health care for offering better health outcomes for the residents across New Zealand and Australia. This joint venture will draw upon and localize existing data science technologies including the deep expertise and intellectual property of Cigna.
The managing director of nib Mr Mark Fitzgibbon believes that this joint venture to be the outcome of several years of research and planning. He mentioned this to be a giant step in the company’s ambitions for the new substantive and cost-effective role in the health care sector.
As a health insurer, nib is determined to help its policy holders by collaborating with their doctors; and with more than 740,000 avoidable hospital admissions in Australia each year, representing nearly 7% of all hospitalisations, the company think there is a vast role for the joint venture.
Stock Performance: On 9 December 2019, the company’s stock traded at $6.70, up by 0.45% with the market capitalization of ~ $3.04 billion (2:26 PM AEST). The stock has generated an absolute return of 35.85% for the last one year and -2.34% for the previous six months.
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