Media releases 2015

Media medium

Southern Cross welcomes media inquiries about any health related topics.

Please contact: Alistair Gray, Communications Adviser, Southern Cross Healthcare Group
Phone: 09 925 6420  Mobile: 021 375167  Emailalistair.gray@southerncross.co.nz

Aug
31

Look at the logic

Monday, 31 August 2015 by Aimee Bourke

New research shows that if fringe benefit tax (FBT) on employer subsidised health insurance were removed over half of New Zealand businesses not currently providing it would look to do so.

This is one of the findings from the second Wellness in the Workplace survey - a nationwide study of 113 employers (with 116,000 employees) by Southern Cross Health Society and BusinessNZ.

Southern Cross Health Society Chief Executive Peter Tynan says this research is particularly timely as Parliament prepares to debate the ‘Affordable Healthcare Bill’, which proposes the abolition of fringe benefit tax.

The Affordable Healthcare Bill consist of three parts:

1. Parent category migrants are required to have health insurance when they arrive in New Zealand, and maintain it for 10 years.

2. That fringe benefit tax (FBT) is removed from health insurance to incentivise employers to include it in a salary package.

3. That the Government provides people over the age of 65 with a 25% health insurance premium rebate, up to the value of $500 a year.

Tynan says, another finding in the Wellness survey was that attending or waiting for medical appointments was the third most common cause of absence for non-manual employees in New Zealand – the first was non work-related illness and the second caring for a family member or other dependent due to illness or injury.

“This clearly supports 2013 findings by TNS showing that for those requiring surgery, an average of five weeks per person was being lost from the workforce as a result of surgical waiting list back-ups.

“Thousands of New Zealanders waiting for surgery are having to take extended time off work, and also need loved ones to do the same so they can take care of them - the flow-on effect for businesses and throughout the New Zealand economy is huge.”

The idea behind the Affordable Healthcare Bill is to boost uptake and retention of health insurance and to alleviate the burden on public health by freeing up resources and reducing waiting lists.

At present, employers who contribute to a healthier workforce are penalised with additional tax payments. The removal of FBT on health insurance would also then align with the current tax treatment of accident insurance (ACC) - which has no FBT applied.

Tynan says, “For the same reason it is important to get those with injuries back to work promptly, it is equally important that those with illness should receive prompt medical treatment. It doesn’t make sense that if a person breaks a hip due to a fall it is more important to get them back to work quickly than if the hip is damaged due to wear and tear – but at the moment that’s the logic.”

The Affordable Healthcare Bill is logical on two fronts:

1. Employers should be playing a larger role in employee health, not being taxed for providing health benefits. Employees returning to work faster from illness will lead to higher productivity and savings for businesses, economic growth for the country and a better quality of life for more New Zealanders.

2. More Kiwis being provided health insurance will lead to direct savings to the public health system due to surgeries picked up in the private sector. This in turn will:

  •  Reduce incidences of more expensive debilitating conditions
  •  Reduce carers cost
  •  Reduce public waiting times
  •  Enable the public system to focus more on other areas of need

 More than ever, what the proposed Bill serves to highlight is the need for clear and open debate about the provision of affordable health care options. While perhaps not a total solution it’s a good start.”

Note:

- The full Wellness in the Workplace 2015 survey can be found at Wellness in the Workplace Survey Report 2015

- The survey conducted by TNS in September 2013, involved 1830 people and had a margin of error of 2.3 percent.