Southern Cross says it told advisers, policyholders of withdrawn benefit

Southern Cross Health Society has acknowledged it removed a $60,000 a year benefit for non-surgical hospitalisation from its policies but is claiming it advised both advisers and policyholders of the change.

Friday, September 1st 2023, 2:04PM

by Jenny Ruth

“The non-surgical hospitalisation benefit was removed as part of [the] society’s benefit review in 2020,” says the head of customer strategy and experience, Nic Johnson, in a statement.

“Members were communicated with at the time of the benefit change,” Johnson says.

As GoodReturns has reported, the notification sent to policyholders in November 2020 referred only to additional coverage and did not say that the non-surgical hospitalisation cover was being removed.

Johnson says Southern Cross advisers were also told about the changes at the time via a virtual meeting and that advisers also have access to the company’s adviser gateway portal to manager their customers’ policies.

“The portal includes a news section where notifications related to all benefit/policy changes are published,” he says.

“The original intention of the non-surgical hospitalisation benefit was as a ‘catch-all’ for eligible healthcare services that required in-hospital medical treatment. Based on a 2019 review of our claims data, which showed that the benefit was not widely utilised, it was assessed that this benefit was no longer fit-for-purpose,” Johnson says.

“The majority of medical (or hospitalisation) claims at the time were already covered under existing benefits, such as the surgical procedures, chemotherapy, radiotherapy and diagnostic tests/imaging benefits,” he says.

These benefits “more precisely defined coverage, and, to align with this approach, the non-surgical benefit was repositioned so that it more acurately reflected what members received.”

The type of claims which the original benefit covered are now covered by and IV infusion (non-cancer) benefit “with any additional outlier reassigned to other benefits where it more appropriately fit,” Johnson says.

The IV infusion benefit provides up to $750 a year under Southern Cross’ Wellbeing Two with $500 excess policy, for example, and up to $600 in claims a year under its Kiwicare policy.

Johnson says other benefits that replaced the one removed include overnight stays associated with a sleep study, which continue to be covered under the diagnostic test benefit, and cardiac in-patient claims following private cardiac assessments that resulted in a member requiring same-day in-patient care.

The surgical procedures benefit continues to cover hospital stays for eligible medical healthcare services, such as injections provided by a specialist and pain management.

“In terms of the hospital accommodation, early admission for treatment is covered under the appropriate benefits,” Johnson says.

“However, any hospital stays for monitoring or pending diagnosis [with the exception of cardiac assessments] is not covered and has never been covered as this is the role of the public health system,” he says.

Tags: Southern Cross

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