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Kiwis Vastly Underestimate The Real Cost Of Elective Surgery

News release
2 November 2012

Kiwis Vastly Underestimate The Real Cost Of Elective Surgery

A new survey by Southern Cross Healthcare Group has found that the majority of New Zealanders are completely unaware as to the true cost of elective (non-urgent) surgery.

Only a third of the 2000 New Zealanders surveyed believed they had an understanding of how much three common surgical procedures cost.

Those who indicated they did have an idea were asked to estimate the cost of those surgeries in the private sector. However, the majority cited prices that were just a fraction of the real cost.
• 21% believed the cost of a knee replacement was $2,500 or under. Southern Cross data shows current prices for the majority of these procedures in private practice are in excess of $19,000 (including prosthesis). Only 15% of people estimated that this procedure cost more than $15,000.
• 27% believed the cost of a hip replacement to be under $5,000. The majority (45%) suggested it was between $5,000 and $15,000. Just 28% of those surveyed thought it cost over $15,000. Southern Cross data shows the majority of these procedures in private practice are in excess of $18,250 (including prosthesis).
• Though 28% believed a single cataract replacement cost under $1000, a number were more realistic about the cost of this procedure. 37% believed it cost between $2000 and $5000. Southern Cross data shows the majority of these procedures in private practice are in excess of $3500. (This figure includes variations for day stay, overnight stay and anaesthetic type).
The survey found that those from higher income households tended to have a better understanding of the cost of healthcare.

Southern Cross Healthcare Group CEO Ian McPherson called the survey results “a huge worry” in light of the increasing pressures on publicly funded health resources.

“Already around half of all elective surgeries are funded privately. As the population ages, it is highly likely New Zealanders are going to be asked to fund an increasing portion of their non-urgent healthcare costs in the future in order to keep the country solvent.”

“New Zealanders need to be prepared for this reality, and start thinking about how they will fund it. In doing so, people need to be aware of just how much these surgeries do cost.”

McPherson said medical costs are why health insurer Southern Cross Health Society is contracting at agreed prices with an increasing number of healthcare providers.

“The price of many procedures has risen substantially over the last decade. As a not for profit organisation, the Health Society is strongly focused on ensuring prices charged to its 820,000 members are fair, reasonable and represent good value for money.”

$1,000 and under$1,001 - $2,000$2,001 - $3,000$3,001 - $5,000Over $5,000
Single cataract replacement28%19%17%20%16%
$2,500 and under$2,501 - $5,000$5,001 - $10,000$10,001 - $15,000Over $15,000
Hip replacement13%14%31%14%28%
$2,500 and under$2,501 - $5,000$5,001 - $10,000$10,001 - $15,000Over $15,000
Knee replacement21%30%23%11%15%


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