Does your health insurance cover non Pharmac medications? | Protection Solutions

Does your health insurance cover non Pharmac medications?

Does your health insurance cover non Pharmac medications?

July 17th, 2020

Many people rely on their medical insurance to help them cover the costs of treatment if they get sick with cancer, however it is important to note that not all policies are the same when it comes to the topic of funding non Pharmac medications. There may be some medical insurance policies that help you afford specific drugs that could be lifesaving whereas other policies may not.

After reading an article on Newshub.co.nz that revealed in April Pharmac’s decided to halt intentions to publicly fund Keytruda, a lung cancer drug that comes at a high price, we thought it prudent to discuss which insurance policies cover Pharmac medications and which do not. 

How Pharmac decides which medications to fund:

Pharmac use the below factors for consideration to guide their thought process. This means when deciding whether to fund a medicine or device, Pharmac consider:

Need – what’s the impact of the disease or condition?
Benefits – what benefits or side effects would the medicine deliver?
Costs and savings – what costs and savings would result from funding the medicine?
Suitability – does the medicine come in a form that makes it easy to take?

Pharmac started funding drugs for the treatment of advanced melanoma, on 1st July 2016 and Keytruda from 1st September 2016. These specific drugs were previously only available to people with the ability to pay for them out of their own pocket or via a health insurance policy, that offers cover for non-Pharmac subsidised drugs. According to the News Hub article “Plans were outlined in September last year to issue a Request for Proposals (RFP) for immune checkpoint inhibitors for lung cancer – including Keytruda – but that was withdrawn by Pharmac”. As a result, unless you have a Non- Pharmac funded policy then you will have to pay for the treatments.

To read more about how Pharmac funded various medicines click here.

What Insurance Policies cover Pharmac and non Pharmac medications?

There are three types of insurances that can help with the funding of non Pharmac Medications.

1.            Health Insurance

2.            Trauma Insurance/ Critical Care/ Progressive Care/Serious Illness

3.            Cancer Cover

Health Insurance:

All health insurers have some covers for Non Pharmac medications. The main difference is the level of cover they offer. These drugs can sometimes be thousands of dollars, so high limits are important.

Some insurers are already ahead of the game and have increased their cover for cancer treatments that are not currently funded by the Government. Regarding health cover AIA, NIB, Partners Life and ACCURO all have great cover for non Pharmac Cancer medications.

AIA for example increased their cover for non-surgical Pharmac and non-Pharmac treatments in 2015 to $500,000.

Trauma Insurance/ Critical Care/ Progressive Care/Serious Illness

All the main companies offer Critical Care or Trauma cover, these pay a lump sum and you can use this to fund your own cancer care and cancer care drugs. Again, there are different levels of cover and policy wordings. Not all covers are equal. These also cover a wide range of other conditions and can be structured in a way to fit what you need.

Cancer Covers:

There are a few insurers that offer cancer cover products that work similarly to trauma cover. Asteron Life’s Cancer Cover pays a lump sum on the diagnosis of cancer. You can use the funds however you want to, and this is a very cost-effective solution. Better still they have level premium options to lock down long term costs (conditions apply).

There is a lot to consider and understand when looking at covers that will support cancer treatment. Policies with Southern Cross for example offer unlimited cover for surgery, however what this means is that the cost for surgery in relation to cancer will not come from the cancer care limit. AIA on the other hand have surgery related to cancer included in their cancer cover amount.

If you have a medical insurance policy that does not cover non-Pharmac funded drugs or treatments, there is the option to take out a separate policy. There is a difference in premiums between policies that cover Pharmac versus non-Pharmac drugs, however if you do not wish to take out an extra policy have a look at a higher excess to reduce your premiums.

If you wish to know whether a policy covers non-Pharmac funded drugs it is important to contact us before making your decision, we can look at what covers could be right for you.