Older Southern Cross policy-holders waiting on a review of the fee structure are growing frustrated, with some threatening to cancel policies.
The Rev Dr Terry Creagh pays an annual $5000 to Southern Cross for himself and his wife, and the Selwyn Village resident is one of many older people complaining about the charges.
More than 90,000 Southern Cross members aged 65-plus could soon get details of an inquiry into premiums after activist accountant Bruce Sheppard carried resolutions and spoke strongly at the society's annual meeting at Ellerslie in December.
The terms of reference of the inquiry he pushed for could be posted on the society's website shortly, once its scope is agreed on, but there will be no quick-fix to the problem.
Inquiry results and suggestions will probably not be unveiled until this year's annual meeting in Auckland in December.
Members could then get the details of how the society plans to reward longevity and ease premium costs for its older members.
Creagh said he had been a member of the society for half a century and felt let down by the system as it stood.
"Old people [are] feeling unfairly penalised," he said.
"There are ways of dealing with the problem.
"I think my concerns represent those of many elderly people in the country who insure with Southern Cross, either struggling to pay the excessive premiums or giving up and cancelling out.
"When, in youth, I signed up, I understood that I would be cared for through life and would receive not less than 80 per cent rebates. Perhaps this is wrong and I misunderstood, it was a long time back.
"Over the years I have faithfully paid my premium demands, without having the least idea of what would take place in later life."
Creagh considered $5000 exorbitant and unethical.
"Recently I consulted a doctor in private practice and was charged $1000, from which amount Southern Cross refunded $400," he said. "I have paid very much more in premiums than ever claimed in total rebates.
"Now that I depend on superannuation, I find myself virtually forced to cancel the cover and rely on the public system which, of course, is likely to prove perfectly adequate for my needs."
A couple of years ago Creagh protested to Southern Cross, a gesture which was abruptly dismissed, he said.
Southern Cross chief executive Peter Tynan said he shared members' concerns over the cost of premiums for older members.
"The New Zealand insurance model is that premiums directly reflect the costs of healthcare utilised by a policy-holder's age group," Tynan said.
"The growing cost of healthcare is something Southern Cross has made its number one priority to address on behalf of members through a number of initiatives - such as the affiliated provider programme."
People aged 65 years or over made up 11.6 per cent of Southern Cross Health Society members but accounted for 33 per cent of the total claims costs for the 2011 financial year, Tynan said.
"Overall, in the past three years, for every $1 received in premiums we paid out 99 cents in claims to members aged over 65," he said.
"Consistently high claiming by older members means their premiums will inevitably be higher. This is a huge concern to us."
There were no easy answers, Tynan said.
Measures to be investigated in the review included reverse mortgages so that people could use the equity in their houses to pay for private health insurance.
* Southern Cross has about 90,000 policy-holders aged 65+
* Older couples are complaining of $5000 annual premiums
* Formal inquiry into how to lower these has now begun
* Terms of inquiry details to be made available soon
* Review of charges to go to society AGM in December