Focus on profits is sickening
DID you ever get the feeling you were a big sucker for bothering to fork out your hard-earned for health insurance?
My opinion has wavered on this subject over the years. I only took up insurance for myself after going through a hip operation in a public hospital about six years ago and ending up a few grand out of pocket for the privilege.
I went for the el cheapo option which, over the past six years, has almost doubled in cost per month, from about $60 to more than $100. No worries though, right? If the worst happens, at least I will be looked after, right?
Recent events have made me wonder about all that. I was watching a report about the privatisation of Medibank on Monday night that provided a bit of a crude reminder that, at the end of the day, these insurers are pretty much just focussed on one thing - making money.
The reporter mentioned that, once the privatisation takes effect, Medibank Private will be looking for ways to increase the returns for its very important investors.
One of the things the reporter mentioned was that the business would somehow find a way to pay out less money to private hospitals for surgical procedures.
My ears pricked up.
How does an insurance company put up a facade as an organisation that takes care of people in their time of need when they admit to the desire to rake in more profits to keep the shareholders happy?
I suppose it would be too much to ask the managing director of Medibank, George Savvides, to tighten his belt a little bit, wouldn't it? Yes it would. In fact, you probably won't be surprised to learn that Mr Savvides is up for a tantalising pay rise in November.
His pay will effectively go from $1.2 million to $3.99 million, provided he gets the initial public offering out the way successfully and reaches the forecast profit of $250 million.
How does this sit with people paying a good chunk of their weekly wage to ensuring their family is okay if one of them gets sick or injured?
Maybe you'd be better looked after buying shares in Medibank instead of paying for insurance.