HFANZ executive director Roger Styles said insurers paid $797 million in claims in the year, up $72 million on June 2009.
On average, claims costs had grown by 9% per annum over the past five years.
Styles said that around 80% of the value of claims paid related to elective surgery and associated costs.
"Growth in claims costs has been running at a high level over recent years due to increased demand, expansion of services funded, and medical inflation. Cost-shifting from the public sector has also contributed," he said.
Premium income was up 8.5% on the June 2009 year to $918 million. This compared with an annual increase of 4.9% recorded for the March year and 5% for the previous June year.
"Increases in premium income over recent years have tended to lag behind the underlying growth in claims costs," Styles said.
Despite premium and claims growth, the level of health insurance coverage eased again slightly in the June quarter with a drop of 800 lives covered. The reduction in lives covered over the full June year was 5200 or 0.4%.
Styles said the drop took numbers back to where they were in June 2008, with 1.389 million New Zealanders having health insurance.
"Overall, coverage tends to be holding up pretty well despite the adverse economic conditions over the last couple of years," Styles said.
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