The DILEMMA

In a highly regulated Healthcare environment, Medical Aids are constantly under pressure to maintain low increases in contributions whilst trying to sustain their existing benefits. Regulations enforcing Prescribed Minimum Benefits, access for all irrespective of age or illness and a requirement to retain high reserve levels are just a few examples of what is driving up the cost of benefits being offered by these Medical Aids. All Medical Aids have also been given a directive from the Council for Medical Schemes that their annual increase may only be at a rate of not more than CPIX + 3%. These onerous regulations and the ever-increasing cost of healthcare necessitate an annual contribution increase well in excess of the guideline of CPIX + 3%. What do Schemes do?

Some of the ways Schemes are coping are firstly by re-examining the rate at which they re-imburse costs related to in-hospital treatment or procedures, and secondly by recovering some of the expenses attached to frequently occurring events by adding co-payments. The result of this is that the member now has an ever increasing
self-payment burden to carry.

If Medical Practitioners charge in excess of the tariff rate at which the Medical Aid reimburses the client for procedures performed in hospital, then the shortfall will be for the member’s account. Actual claims assessed by Complimed over the last 8-10 months have shown that this is in fact the norm and that Medical Practitioners have been charging up to and sometimes even greater than 350% or 3.5 times the tariff.

An example of such a claim is listed below:

Complimed has also noted an increasing tendency within scheme options for more and more self-funded co-payments. For example, Discovery & Momentum options now have co-payment amounts ranging from R 850.00 to R 2 000.00 for a number of procedures including MRI/CT Scans, Dentistry, Endoscopic Procedures, Hospital Admission and more.

The SOLUTION

Either upgrade the option within the Medical scheme, at a significant increase in premium (15 – 20% in most cases).

OR

Self - insure through CompliMed, who has recognised this potential shortfall and created its range of GAP products to cover these payment shortfalls and co-payments.

All these products are defined as an “accident and health policy” under the Short-Term Insurance Act No 53 of 1998.