Western Australian-based health insurer HIF is celebrating its 50th year and, as part of those birthday celebrations, has embarked on a major corporate restructure.
The not-for-profit fund started its life as the Western Australian Government Railways Employees Hospital and Medical Benefits Fund.
It became a fund open to the public in 1978, the same year it became HIF.
As part of the restructure the fund has set up a redevelopment program to streamline itself for the future.
HIF chief executive Stephen Brown said the restructure had occurred as a result of a review of strategic and operational functions within the organisation, and to set the framework for a focus on claims management, efficiency, member growth and retention and compliance.
He said the fund aimed to have 20,000 members by 2005.
It is currently just 1,000 members short of that mark.
From those 19,000 members, the fund provides health insurance to more than 45,000 Western Australians, when taking into account different coverage types such as family and couples’ cover.
In the WA context HIF claim to be the third largest health insurer, although somewhat dwarfed by the State’s largest health fund, HBF.
HBF, in turn, is ranked in the top six of national health funds.
Mr Brown said the increasing volume of claims was possibly the largest issue facing health funds.
"That’s driven by a number of things. One is the increased technology. The capability we have in the private health industry to treat conditions has greatly increased," he said.
"A big part of our benefits go for dental services. There are a lot of procedures they can do that they weren’t able to before.
"Another issue is people being aware of their benefits when they have health insurance coverage."
Mr Brown said the Federal Government’s introduction of the 30 per cent health insurance premium rebate in 2000 had also played a part in that increased claims volume.
"When the rebate came in we experienced a 50 per cent growth in memberships," he said.
However, the rebate also played a part in the entire health insurance sector experiencing a $62 million loss in 2002.
By 2002 the increased number of members was starting to make claims on health insurance and health funds had opted, in 2001, to forgo a premium increase.
The combination of the two resulted in Australia’s health insurance sector taking an $82 million loss.
HIF, which traditionally runs at between a 1 per cent and a 5 per cent surplus – health insurance is a low margin business – was among them.
The only shining light for health funds that year was the $20 million-plus profit made by a number of ‘closed’ funds. Those are funds limited to a specific industry group – much as HIF was back in its WAGR days.
However, Mr Brown said HIF was one of the many health insurers that wanted the Government to retain the 30 per cent rebate policy.
He said removing that policy would result in a major reduction in health fund memberships and put a huge strain back onto the already struggling public health sector.
Mr Brown said the fund had planned a number of events to celebrate its 50th year.
