It’s that time of the year when medical schemes begin publishing their benefits, contributions, and enhancements for next year – and the options can be overwhelming especially as it is often not easy to make like-for-like comparisons. There are currently 18 registered open medical schemes to choose from, all with a variety of plan options ranging from entry-level network options to fully comprehensive options. Sifting through the brochures and fine print can be time-consuming and bewildering and, as such, this article is aimed at highlighting what to look for when choosing a medical aid.
At the outset, it is advisable to undertake a rigorous budgeting process to determine your affordability. While medical aid is a high-cost budget line item, as a general guideline medical aid premiums should ideally not account for more than 10% of your monthly expenses. However, as medical inflation outstrips consumer inflation by between 3% and 4% per year, you will need to take your future affordability into account in the process. Once you are clear on what you can afford to pay in respect of medical aid premiums, you should be in a position to narrow down your options.
What is important to keep in mind is that all medical aids are rigorously priced by teams of actuaries and healthcare experts, so beware of simply opting for the cheapest premium because you get what you pay for. If a premium looks much cheaper than other similar schemes, make an effort to read the fine print and be on the lookout for low sub-limits, high-co-payments and rigorously managed care that restricts access to specialists.
While your past health is no indication of what lies ahead, it’s advisable to take stock of your current health status and that of your dependants. Specifically, make a list of any pre-existing conditions or ailments that any of your family members suffer from, together with any chronic medication or treatment that you or your family make use of. You can then cross-check the benefits on offer against the specific needs of your family. If you don’t have children but are planning on starting a family, you will need to look for a plan that caters for pregnancy, birth and post-natal care. Remember, you cannot upgrade your plan option during the course of a benefit year, so if you are planning to fall pregnant during the course of 2022, be sure to select an appropriate plan for your pregnancy.
Private hospital costs are exorbitant and generally unaffordable for the average person which is why choosing the right hospital plan is so important. Remember, not all hospital plans are equal. Entry-level plans offer in-hospital treatment at a limited network of hospitals only up to 100% of medical aid tariff – which sounds deceptively attractive. However, the doctors and specialists treating you in hospital have the freedom to charge rates in many multiples more than the medical aid tariff, and the difference will be for your own account. Also, be sure to determine what co-payments are required in respect of hospital procedures, radiology, pathology, scopes, scans, specialised dentistry and treatment by specialists as many of these will be out-of-pocket expenses.
Financial stability of the scheme
Look for a medical scheme that has a good track record and reputation, and that has a reputable and reliable brand. Specifically, investigate the claims payment track record of the medical scheme to ensure that they pay reliably and on time. Some poorly run medical aids have slow claims processing and payment capabilities which is frustrating for both members and service providers – with many service providers choosing not to deal with such medical schemes, which is not ideal.
When it comes to medical aid, service levels are really important, so do your homework. Specifically, find out how efficient the customer call centre is, how quickly the phone is answered, how efficiently member queries are resolved without having to escalate, how quickly claims are processed and paid, and how easy it is to get hold of someone. Find out who the administrator of the medical aid is and what their reputation for customer service is like.
Most medical aids have managed care divisions, some of which are outsourced to third-party managed care operators. Managed care is used by medical schemes to reduce costs, while still keeping the quality of care high, and these can be done through provider networks, provider oversight, drug formularies, chronic condition programmes, and pre-authorisation mechanisms. While managed care programmes are mostly designed to ensure that members get appropriate, good quality care, it can be frustrating if not well administered. Find out who runs the medical scheme’s managed care programme, what their service levels are like, and how difficult it is to get access to care. For instance, do you need to get a GP referral in order to consult with a specialist, or does your scheme allow you to go directly to a specialist?
Demographics of scheme
Medical aids operate on the basis of cross-subsidisation where the premiums of younger and healthier members are used to cross-subsidise the healthcare costs of the older, sicker members. As a result, it is important to determine the demographics and size of the medical scheme, keeping in mind that size does count. The larger the risk pool, the more predictable the claims will be. Similarly, the higher the average age of the group, the higher the financial risks will be. Further, check the membership of the scheme over the past three years to determine if there has been any significant loss of membership and, if so, why.
Annual contribution increases
It is also important to determine whether the scheme’s annual contribution increases have been out of kilter with the rest of the industry. Again, look at the scheme’s contribution increases over the past three to five years. If they have been consistently greater than the market average, ask yourself why and be cautious.
Determine the extent to which the medical scheme has kept pace with technological innovation which allows for ease of interaction, claims submission, communication, and service provider interface. Technologically advanced medical aids offer user apps through which members can track their benefits, submit claims, find healthcare providers, connect online with doctors, and engage in mobile chats. Make sure that your medical aid has kept pace with technology and offers user-friendly technology for your convenience.
While loyalty and rewards programmes sound attractive, avoid making a decision solely on the basis of how appealing the programme is to you. Remember, you’re primarily looking for good, reliable healthcare cover – so don’t lose sight of this. While the benefits and rewards offered by these programmes might sound attractive, these programmes are only really beneficial if you are fully engaged in all aspects of the programme, keep up-to-date with their enhancements and qualifications for rewards, and consistently redeem your benefits.
While most medical aids offer chronic condition benefits, it is important to determine to what extent their programme meets your specific healthcare needs. The medical aid brochure or website should include a list of all conditions covered by their chronic condition programme, together with a list of approved medicines on their formulary. Some schemes also offer specialised programmes for illnesses such as diabetes, cancer, HIV, and asthma, and it pays to do your research to determine whether these programmes will be of financial benefit to you.
If you’re battling to choose a medical aid, or contemplating changing medical aids, it is advisable to seek advice from an independent healthcare advisor who can guide you through the process to ensure that you find a solution that works for you and your family.