Trends in Health Fund Coverage

The Private Health Insurance Administration Council (PHIAC) has just published updated Health Fund Membership Statistics for the period ending 30 June 2006, including:

• Coverage of Ancillary Insurance Tables offered by registered Health benefits Organisations by State and
• Contributors of Ancillary Insurance Tables offered by Registered Health Benefits Organisations by State
• PHIAC A Reports - A quarterly report detailing, by State, the membership and benefits paid by Registered Health Benefits Organisations for the period

Victoria has one of the lowest rates of ancillary table membership in Australia, with only 33%, compared with a national average of around 42%.

The dental benefits paid from ancillary tables in Victoria for the quarter ending 30 June 2006 were as follows:

Services...........1,201,850
Cost..................$116,957,953
Benefits ...........$54,547,182

This represents over half of all ancillary benefits paid in Victoria (total $107,127,877) with the other 28 areas covered in the ancillary table generally having quite small allocations. Optical ($16,408,197), Chiropractic ($9,266,711) and Physiotherapy ($8,941,073) were the next highest.

The dental benefit also represents only about 45% of the costs of services provided to health fund members, and this factor, perhaps combined with the intrusive and abrasive manner of some of the larger health funds when dealing with dental practices, helps to explain why the Victorian rate of ancillary table membership is only around 33% of the population.

Nationally, total dental benefits of $295,053,068 were paid by health funds in the June 2006 quarter, so despite Victoria having around 25% of the Australian population, only about 18.5% of health fund benefits were paid to Victorian health fund members. Extrapolating from the June quarter figure of almost $300 million, it seems health funds are now contributing around $1200 million p.a. towards the cost of dental treatment, out of a total estimated at around $6.5 billion for 2006/07.

Of a total of $4,694 million spent on dental services in Australia in 2003/04, only 15% ($708 million) was contributed by health funds. The Federal Government (mainly via its DVA scheme) and State Government public dental schemes combined made up just over 15%, with the remaining 70% paid for privately. (Source: Health Expenditure Australia 2003-04)