Major health insurers give customers up to $620 cash back in pandemic profit-sharing

Australians with private health insurance are about to receive $1.6 billion in cash backs from five of the country’s largest providers.

Funds are under pressure to pass on pandemic gains, after soaring last year with delays in elective surgery claims.

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Health insurers Bupa, Medibank, CUA, HBF and AIA have all committed to sharing their pandemic profits with eligible policyholders.

That looks like cash back payments from some providers, as well as deferred premium increases and hardship support.

The surplus brought in by these companies due to deferred claims will be rolled out this year, with some already paying out the surplus to members.

A 2020 report from the Australia Institute argued that restrictions on non-emergency elective surgery during the pandemic would likely result in “unexpected” gains for health insurers.

A former head of the Private Health Insurance Administration Council, Shaun Gath, at the time called on the government to step in and “monitor the return of any profits to customers, to ensure that it actually happens and is paid fairly. done”.

Here’s everything you need to know.

BUPA

BUPA offers a total of $155 million in cash backs.

Am I eligible?

You are eligible for a refund if you have been a member of the fund for at least 90 days between July 1, 2021 and June 30, 2022.

Even if you’ve canceled your membership since then, you’re still eligible for payment if you were a member during this time.

You must also be a domestic Australian resident policyholder to be eligible.

Foreign visitors and students, and members with only ambulance coverage, are not eligible.

How much and when will I get paid?

The fund will use the bank details listed with your account and will start depositing the amount from October 2022.

The cashback amount depends on the policy you have with the fund.

  • Extras only: between $16 and $44 per policy
  • Hospital Only: Between $42 and $118 per policy
  • Hospital and perks: between $58 and $162 per policy,

BUPA will try to contact customers and say: “You will receive a message from us stating how much you will get back.

“We have committed to returning all money we have saved from unused claims or other effects of COVID-19.”

Repayment amounts vary from state to state, depending on how severely the area was affected by the pandemic.

“We recognize that due to strict government lockdowns, customers in NSW and VIC were significantly more affected in their ability to use their policies.”

medibank

Medibank made an annual net profit of $441.2 million through June 30 last year.

In February, health insurance profits rose 10.3 percent to $280.9 million on the back of premium income growth of 3.8 percent to $3.5 billion.

It’s unclear exactly how much of that profit will be shared with policyholders, but the fund’s cashback payments are included in a $682 million support package.

Medibank’s pandemic earnings share will be offered in the form of an extended pause on premium increases, in addition to some cashback amounts for eligible customers.

The premium break has now been extended from October to November.

Am I eligible?

You are eligible for a refund if you had a live-in hospital or extra policy between January 1, 2022 and June 30, 2022.

You are not eligible if your policy was only ambulance coverage, foreign visitor coverage, foreign employee coverage, and foreign student health coverage.

How much and when will I get paid?

The fund simply says that the cashback payment will be made sometime this year using the bank details on your account.

This cash back amount is based on the type of coverage you had and the period you were an active member of that policy.

  • Extras Only: About $28 per policy
  • Hospital Only: About $90 per policy
  • Hospital and Perks: About $123 per policy

If Medibank does not have your bank details, you will receive the free days of cover for the same value.

HBF and CUA

Insurance company HBF took over CUA Health last year, so the obligations of the companies are largely the same.

HBF calculated a $42 million surplus from deferred claims to be returned to members.

HBF has already paid 410,000 eligible policyholders who had a policy between March 25, 2020 and June 30, 2020.

It paid perks only policies $20, and family policies with hospitals and perks up to $140.

“HBF was the first and only major fund to completely cancel the 2020 premium increase, saving our members $37 million,” said John Van Der Wielen, CEO of HBF at the time.

CUA similarly identified a $3.7 million surplus and paid just over 41,100 policyholders last December.

“When we acquired CUA Health last month, one of the first assignments was to prioritize payment of COVID-19 savings for our new members,” said Van Der Wielen.

CUA announced in March 2021 that it would make cashback payments to eligible members who had a policy in 2020 between March 25 and June 30.

Payments similarly ranged between $20 and $150 per policy, depending on coverage.

AIA

AIA Health Insurance offered refunds on additional premiums paid in August last year, less any claims made between January 1 and December 31, 2021.

Members who were part of the AIA Vitality program could also receive a refund ranging between 50 percent and 100 percent of their membership.

AIA claimed at the time that total refunds would be calculated in early 2022 and refunded directly to members.

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