April 13, 2018
AIA Australia has thrown its weight behind calls to change legislation that would allow life insurers to fund early intervention and treatments for mental health conditions.
AIA Australia and New Zealand Chief Executive, Damien Mu said the insurer would support an overhaul of legislation which prevents funding for any treatments offered by Medicare, or where a hospital or general treatment is involved.
Mu said the current legislation was creating a barrier to funding the treatment of mental health and represented a breakdown in the Australian health care system and its handling of a growing issue.
The recent report from the PJC Inquiry into Life Insurance, which included a recommendation for early intervention, should be a catalyst for the change to the legislation, Mu said.
“…the Government and industry must work together….so life insurers are allowed to pay for rehabilitation services and medical treatments…”
“This inquiry is a positive first step and the Government and industry must work together to remove this anomaly from the health system so life insurers are allowed to pay for rehabilitation services and medical treatments for people who suffer from a mental illness,” he added.
“There is currently a gap in the health system where people may be unable to receive or afford the support they need, at the time they need it most. We believe life insurers can help to fill this void through funding medical treatments,” Mu said.
The removal of legislative restrictions would provide a range of benefits, according to Mu, including providing help to those with mental health issues, helping people to return to work earlier, building a more sustainable life insurance industry and reducing the financial burden on Government.
Mu also called for a shift in how funds are provided under life insurance claims for those with mental health issues, noting that under current arrangements a claimant with a mental health condition has to establish that they are permanently unable to work before they can access recovery fund through a life insurance policy.
“Lump sum policies play a hugely important role in our society, but mental health is more complex and deserves additional thought to the best methods in providing support, especially in encouraging a return to work,” Mu said.