Government’s health insurance is improving on its poor history of turnaround for claims, a spokesman said.And better prediction methods in the Department are reflected in its latest Budget figures.Health Insurance funding for the new fiscal year is $11.3 million, up considerably from the $4.4 million put aside a year ago.Much of the rise is in the Medical Claims Subsidy, where $2.9 million was allocated last year and $7.9 million actually spent — and $9.6 million budgeted for 2013/14.“The figures reflect better predictions of claims,” a Health Insurance Department spokesman said.“The biggest driver of the Health Insurance Department’s budget variations is medical claims cost. Due to the nature of claims development, our budget will be volatile over time being driven by utilisation changes and medical inflation, or price increases.“Although we can make some predictions, it is not an exact science and therefore some variability in our results is to be expected, as opposed to the typical Government Department.”The latest Budget gives elaborate performance measures indicators for Government’s insurance.The spokesman said the figures reveal a level of accuracy in line with that of the private sector.“It is important for our insurance products to be benchmarked against some objective industry standards so that like-for-like comparisons can be made,” he said.“The performance measures are divided into several sections, including administrative expense ratios; medical loss ratios; actual claims expenses incurred, in dollars, along with a comparison with the previous years; claims turn-around-times, and procedural and financial accuracy of key functions.”For example, the administrative expense ratios for the Health Insurance Plan (HIP) show the Department lagging behind industry standards.HIP’s score for the 2011/12 fiscal period was 8.9 percent — revealing that “the Department is not as administratively efficient as we would like, and certainly less efficient than a large American insurer”, the spokesman said. “The implication is that we need to lower our costs moving forward relative to the industry.”FutureCare was more expensive, with a ratio of 9.3 percent for the same fiscal period.HIP’s loss ratio, meanwhile, was 105.09 percent in 2011/12.“That means HIP was losing money,” the spokesman explained.“FutureCare’s loss ratio was 67.3 percent, which means that it took in more in premium than it paid in claims. HIP is well above the Department’s target of 90 percent and FutureCare is doing very well as it is significantly exceeding the target from a claims perspective.”The Health Insurance Department paid almost $150 million in claims over the 2011/12 fiscal year.According to the spokesman, the Department was “pleased” with the year-over-year claims trend, as most of the insurance products had less than the targeted three percent increase in claims.“This target is meant to roughly be in line with inflation,” he added. “The only outlier is the claims increase for the Mutual Reinsurance Fund, which rose by 6.5 percent in fiscal 2011/12, as opposed to the prior year.”The spokesman acknowledged that HIP has been criticised “for many years” over its slow turnaround on claims — but said the record was improving.“The numbers for fiscal 2011/12 show that for all the health insurance products managed by the Department (HIP, FutureCare, MRF and the Subsidies), the median (average) turnaround time was 38 days. This is positive news for medical providers and the general public, and should address some the concerns of years past.“The trend for the current fiscal year, year-to-date through January 2013, is that median claims turnaround time improved further to 28 days.”Meanwhile, claims processing accuracy for the Department exceeds 99 percent.“As a benchmark, Colonial Medical (Bermuda) has been advertising for some time that its claims processing accuracy exceeds 99 percent,” he said.“This demonstrates the Department is in line with the local industry.”