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News Article : How to choose your medical aid
Category: Healthcare Insurance : Medical Schemes
Author:Professor Chris Joseph
Email:[email protected]
Posted:27 Nov 2008

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I’m often asked by patients to

From a specialist viewpoint th

However, patients are faced with a number of uncertainties, disincentives from employers and medical aid marketing resulting in confusion and poorly informed decision-making.

What to look for:

  1. Low non-healthcare costs.  This is the amount spent on administrators, managed care, brokers and advertising.  The more your medical aid spends on these costs, the less is available to spend on actual healthcare services.  Average administrative costs are just above R70 per member per month.  Larger administrators should be less than this (efficiencies of scale), not more as is currently the case with some larger administrators.  Don’t be fooled by the “promise” of better administration for higher costs.  Most administrators offer average services: you want your money to go to healthcare.
  2. Value in the different plans offered.  The minimum package/plan will cover hospital and life-threatening conditions (as per the Prescribed Minimum Benefits List) and chronic diseases (as per the Chronic Disease List).  The cost here starts at about R350 per month per member.  As cover increases (out of hospital costs, higher fees for services etc) so will the cost per member.  Compare similar plans (often confusing as there is no standardisation in the funding industry benefit packages).
  3. A truly independent broker.
  4. Funds that pay for healthcare only without “add ons” and other enticements. eg. Flights, movies and linked insurance.

What to ask the broker:

  1. What is their commission?
  2. Do different funders offer them different commissions (the maximum legal limit is approximately R60 per month per member?)
  3. Do they receive any other incentives from funds that they are recommending?
  4. Ask for a comparison of cost vs benefits per plan recommended by the broker.  If they are unable to do this, find another broker who can.
  5. The advantages and disadvantages of buying into higher or lower plans.
  6. How the savings plan and threshold levels are used if these apply to your plan?
  7. Ask for a comparison of year on year benefits:  are they shrinking or increasing?

What to ask your employer:

  1. How much do they contribute to your premiums?
  2. Will their contribution be affected if you wish to use a different medical aid?  If so, by how much and why?
  3. On what basis did they choose the medical aid and what comparisons were made with other medical aids?  Ask for an independent broker analysis comparing the present medical aid to at least 2 other medical aids.
  4. Does your employer assess their selected medical aid regularly?  Benefits change year to year.  The current choice may no longer represent a fair value.

Spend time assessing your medical aid – it may save you.

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