Under 40s turn to not-for-profits

Health funds are in decline right?

Not if you look at the under 40s moving into not-for-profit health funds. Bucking the trend, under 40s are choosing not-for-profit health funds. Natasha Robinson from The Australian [1] supplies the statistics that there has been a decline of 3% of under forties taking out private health insurance from 2017 to 2019, but those taking out not for profit memberships has increased by 2.21%.

What is not-for-profit?

Well, the clue is in the name. None of the money you pay goes to shareholders.

It all goes back into services and benefits for the member. All of it. For Peoplecare members this means local staff who answer calls within 3 rings (at least that’s the aim, we’ve got some of the fastest phone-slingers in the east), no robots, 24-hour claims processing, fantastic health programs [2]. In sum, the money returns to members.

Why don't I get more back from a not-for-profit?

You do. Apart from the fab customer service and fast claims processing, the not-for-profit funds paid 3 percentage points more out in claims than the big 3 commercial funds, according to figures from Members Health Fund Alliance[3]. Members Health Fund Alliance is a group that represents not-for-profit, member-owned and community-based health funds like Peoplecare.

Members Health funds return 87% of premiums back to members in benefits, on average, compared to 84% from Medibank, Bupa and NIB. It may seem like a small difference, but overall, it's a big difference to your pocket and to your customer experience.

If we consider private health insurance as we would any other insurance, the expectation is that it's there if you need it in case of a big health event. We hope not to have to claim car insurance, or house and contents insurance, but if we do, the premiums we pay reflect the insured amount. Health insurance can never survive if the premiums don't reflect the medical costs incurred.

So, what do we do?

While premiums are a difficult obstacle for many, we need to ask ourselves what we will want if ever that big health event arrives. What is best for our family if we need to go for surgery?

Your premiums pay help us care of you when you need it most. Our friendly staff help you answer your health cover questions, especially if you're not a T&Cs reader, (you really should read your T&Cs, for everything, but I’m not here to nag). Ask them how to reduce gap charges, let the experts advise you, let them take the guess work out of it all.

It's good to know that under forties acknowledge the benefits of not-for-profit funds, the extra benefits, the lack of corporate control and profiteering, and the attention to personalisation. It tells us that not-for-profits are doing something right.


'Under 40s take up private health benefits' The Australian 19 January 2020 [1]

peoplecare.com.au/Using-your-cover/ [2]

membershealth.com.au [3]

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