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COVID-19 payday for health fund members

  • June 14 2021
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COVID-19 payday for health fund members

By Cameron Micallef
June 14 2021

A health fund is returning millions in claims to its members, with banned surgeries during the COVID-19 pandemic seeing bumper profits for the health insurance sector.

COVID-19 payday for health fund members

COVID-19 payday for health fund members

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  • June 14 2021
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A health fund is returning millions in claims to its members, with banned surgeries during the COVID-19 pandemic seeing bumper profits for the health insurance sector.

COVID-19 payday for health fund members

Health fund HBF will give its members cash payments of up to $140 in July, returning funds that were not paid out for services due to the pandemic.

The cashback comes on top of the fund’s decision to impose a zero increase in premiums from 1 April.

To be eligible, members must have held a hospital and/or extras policy during 25 March 2020 and 30 June 2020.

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Approximately 470,000 policies are eligible, with payments ranging from $20 per policy (for a single with Extras only cover) up to $140 per policy (for a family with both Hospital and Extras cover).

The payout will cost the fund $42 million in total paybacks.

It’s a move CEO John Van Der Wielen said aligned with the true person of the fund, which was to benefit members.

“That is why HBF was the first and only major fund to fully cancel its 2020 premium increase, saving our members $37 million, why we implemented hardship support measures for our members, and why we also pledged that members would be the beneficiaries of any surplus funds arising from the COVID-19 pandemic,” he explained to members.

The $42 million payment is the remaining balance of a $94.3 million deferred claims provision that was detailed in HBF’s financial accounts for the 2020 financial year.

The provision was an estimate of claims for elective surgery procedures and ancillary services that members could not access while COVID-19 control measures were in place from 25 March 2020 to 30 June 2020 but were expected to be made at a later date.

Of the $94.3 million:

  • Approximately $37 million has been paid in claims
  • Approximately $15 million has been held over to cover claims still likely to be paid
  • Approximately $42 million surplus funds will be paid to members in July/August.

Consumer group CHOICE welcomed HBF returning members’ money but questioned why other funds were unable to do the same thing.

“If HBF can return $42 million to its members, there’s no excuse for Australia’s other health insurance funds to keep hoarding the money of Australians,” CHOICE’s health campaigner Dean Price said.

Mr Price highlighted that this is the kind of transparency we need from this industry. The community is still recovering from the economic impact of COVID-19 and no business, let alone businesses we rely on for our health and wellbeing, should be using the COVID-19 to boost their bottom lines.

“HBF have done the right thing by their members. Australia’s health insurers, it’s time for you to return what you didn’t earn. Big funds like Medibank, Bupa and NIB need to put the community first and be transparent with their customers and the community,” he concluded.

COVID-19 payday for health fund members
COVID-19 payday for health fund members
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About the author

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Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

author image
Cameron Micallef

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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