Do I Really Have Health Insurance, or Do I Just Think I Do?

Many people feel reassured simply knowing they have health insurance.

It sits quietly in the background, filed away, something you hope you never need to think about too much. And for the most part, that feels reasonable.

What often surprises people is that having health insurance does not automatically mean you are covered for everything that matters.

One of the most common gaps we see relates to unfunded or non-Pharmac drugs.

What Are Unfunded or Non-Pharmac Drugs?

In New Zealand, Pharmac decides which medicines are publicly funded. While this system works well for many treatments, not every drug is covered.

Unfunded or non-Pharmac drugs are medicines that are approved for use but are not paid for by the public health system. These drugs are most commonly associated with cancer treatment, although they can be relevant in other situations as well.

If a treatment is not funded, the cost sits with the patient, unless it is covered by private insurance.

That cost can be significant.

“But I Have Health Insurance”

This is where confusion often creeps in.

Many people assume that if they have health insurance, unfunded drugs are included by default. In reality, that is not always the case.

Some policies include cover for non-Pharmac drugs. Some include limited cover. Some exclude them entirely.

Older policies, or policies taken out to keep premiums low, are especially likely to have gaps here.

This is why people are often shocked when they discover that something they assumed was covered is not.

Why This Matters More Than You Might Think

It is not common to need unfunded drug treatment. But if you do, the financial impact can be life changing.

A useful way to think about this is to compare it to house insurance.

Most houses never burn down. That does not mean house insurance is unnecessary.

You insure against events that are unlikely but financially devastating if they occur. Health insurance works in a similar way, particularly when it comes to high-cost treatments.

Is This Only for Rare or Extreme Conditions?

This is a common question, and the honest answer is that unfunded drugs are most often used in serious situations, particularly cancer treatment.

They are not obscure or experimental. In many cases, they are well-established treatments that simply have not been added to the funded list.

Claims for unfunded drugs do happen each year. While it may never affect you, having clarity about your cover matters long before you need it.

Does Adding This Make Health Insurance Expensive?

This is another common concern.

The assumption is that adding specialised cover must mean much higher premiums. In practice, that is not always true.

Many people structure their policies strategically. This can include:

• Choosing a higher excess

• Prioritising cover for major risks

• Accepting lower cover for more common, lower-cost treatments

It is often possible to include protection for unfunded drugs without dramatically increasing premiums. The key is understanding what you are protecting against and why.

How Do I Know If I’m Covered?

There are two simple ways to find out.

You can review your policy wording and look specifically for non-Pharmac or unfunded drug cover. Or you can ask someone to review it with you and explain it in plain language.

What matters most is not how much cover you have, but whether you understand it.

A Final Thought

You do not need to be alarmed or overwhelmed by health insurance.

You do, however, deserve clarity.

Knowing whether you are covered for unfunded drugs allows you to make informed choices about your health, your finances, and your future. And if changes are needed, it is far better to discover that early, rather than in the middle of a health crisis.

Clarity builds confidence.