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Healthy surplus committed back to members

HBF delivers 2018 Annual Report

Author Andrew Walton
Date
Time to read 2 minutes

Operating costs for HBF’s health insurance business were, for the first time in a decade, lower than the previous year, helping HBF to report a healthy surplus in 2017/18.

HBF reported a net surplus of $60.8 million (up 2.1% on $59.5 million last year) despite paying a record $1,634 million in benefits to members. The average HBF member received 4% more in hospital benefits and 4.6% more in extras benefits, compared to the previous year.

HBF Chief Executive Officer, John Van Der Wielen said the year’s improved performance would translate to a lower average increase in premiums for members next year, “This result will help ensure next year’s premium increase will be even lower than this year - and this year’s increase was already one of the lowest of any health fund.”

Cost-saving decisions during the year included HBF’s withdrawal from Members Own Health Funds, conclusion of AFL sponsorships, ending its presence on broker websites, closure of branches where demand had fallen, and internal restructuring to create a flatter, more efficient structure. Changes were also made to some health insurance products, to help keep future premium increases to a minimum.

During the year, HBF made a conscious decision to focus more on looking after its existing members than acquiring new ones. As well as no longer using the costly service of brokers which meant paying high commissions to win new business, HBF stopped offering short term incentives to attract new members, “Enticing sign-up offers are common practice in health insurance, but we believe our offering should speak for itself,” Mr Van Der Wielen said. “We’d much rather direct those funds into higher benefits and better service for our members.”

On improved service, HBF increased the head count in its Perth-based member contact centre, which saw call wait-times decrease during the year.

HBF has this year gone beyond its requirements as a not-for-profit organisation and published a detailed financial report, including the remuneration of its Chief Executive Officer and Non-Executive Directors. Mr Van Der Wielen said the decision signalled HBF’s commitment to transparency and accountability. Prior to this year, HBF published a Concise Annual Report, which was a condensed version of its full financial accounts.



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