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Review your medical plan

Nov 8, 2023

Review your medical planMedical schemes have announced their price increases and new plans for 2024, which means it’s time to review your medical plan.

While the new premiums and the plan changes still require approval from the Council for Medical Schemes, everyone should take the time to review their premium increases and check for any changes to the benefits offered.

To keep premium increases low, some plans may have reduced some of their benefits, or your scheme may have introduced new benefits. To make the most of your medical scheme, make sure you know what your benefits are and that you are using the scheme effectively.

Check the premium increase

Medical schemes announce an average weighted increase across all of their options, but you need to check the premium increases on your specific plan.

Entry-level plans tend to have lower premium increases while fully comprehensive plans with richer benefits tend to have higher premium increases.

Comprehensive plans tend to be taken out by members who require more medical cover, resulting in higher claims. This in turn drives up the claims ratio which results in higher premium increases.

For example, Fedhealth’s weighted average is 10.8%, but the increase on its entry-level plans is only 2%. Members on more comprehensive plans will have to pay up to 14% more on their premiums.

FlexiFEDSavvy is an entry-level hospital plan where the principal member pays only R965 a month in 2024, after a R20 increase. According to Fedhealth, the low annual increase is possible because this plan is aimed at younger members who have a lower claim experience than older members.

Fedhealth’s more comprehensive FlexiFED 2 has a 14% increase, from R2 608 to R2 984.

Across all plans the co-payment for treatment at a non-network hospital increases by 6.5% from R13 800 to R14 700, and co-payments on an MRI increase by nearly 7% from R2 630 to R2 810.

Discovery Health Medical Scheme has kept the premium increase on their Saver plans to 3% by cutting the amount allocated to the Medical Savings Account (MSA).

The premium on the Discovery Classic Saver plan has increased from R4 060 to R4 182 for the main member. However, the amount allocated to the MSA has decreased from R12 180 to R10 020 per annum.

Deon Kotze, Chief Product Officer at Discovery Health says their decision to decrease the proportion of contributions allocated to the MSA was due to financial pressure on members.

“By reducing the allocation to the MSA for 2024, members contribute a lower amount each month towards their MSA. This reduction is a direct saving to the member – every one-rand reduction in the MSA is a one-rand reduction in their premium. This reduced contribution offers our members the flexibility to use the contribution savings to prioritise their specific financial or healthcare needs.”

In comparison, members on Discovery’s Executive Comprehensive plan will have to cough up a significant 13% more, with their premiums increasing from R9 122 to R10 303 for the main member. In this case, the day-to-day benefits also increase by 13%, from R27 360 to R30 900 per annum.

Factors to consider when you review your medical plan

Reduced cover

Medical inflation is around 3% higher than consumer price inflation, so if you review your medical plan and find that your premium increase is below 8%, then be aware that there may be reductions in benefits.

Check if the amount of your day-to-day savings has been lowered, or if your co-payments have increased by more than the inflation rate of 5.5%.

Many schemes have increased benefit limits by 5.5%, but because medical inflation is around 8%, that increase actually amounts do a reduction in cover.

Additional benefits

Some schemes have announced additional benefits, so when you review your medical plan, look out for these. For example, Bonitas has increased the age for a child dependant to 24, regardless of whether or not they are studying.

They have also increased their remuneration rates for specialists in their network and increased the number of approved medications on the formulary to include the top medicines claimed for, which previously attracted a co-payment.

Momentum no longer requires authorisation for screening benefits. Most schemes now offer virtual doctor appointments which are more cost effective or even covered by the plan.

Get specific

If you are undergoing a procedure or diagnosed with an illness, take time to read the benefits related to the claim.

For example, your plan may include seven days of medication post hospitalisation, or it may offer a wellness programme for your chronic condition.

All schemes offer preventative screening benefits. Understand what is covered when you go for your check-up.

The network

Plans that require you to use hospitals and doctors in a specific network are often more cost effective. Generally using a doctor or specialist who is contracted to your scheme will result in a lower co-payment.

Find out which doctors and specialists in your area are part of your scheme’s network.

You get what you pay for

Remember that entry-level plans will exclude high-cost procedures or impose high co-payments.

Coverage for certain chronic conditions may be limited to prescribed minimum benefits, and day-to-day cover may only include primary healthcare. If you are looking to downgrade, make sure you understand what is not covered.

Cost-effective options

Hospital plan

You can opt for a hospital plan which does not provide additional day-to-day benefits. It will, however, cover hospitalization at a private hospital and cover the prescribed minimum benefits which is a list of 270 life-threatening conditions and 26 chronic illnesses that must be fully covered by a medical scheme.

Fedhealth FedSavvy is a hospital plan which covers the prescribed minimum benefits and has unlimited virtual GP visits and 3 face to face GP visits. The premium for a main member is R965. Once you factor in the R364 tax credit the net cost for a principle member is R601 a month.

Health insurance

Having health insurance is different from being a member of a medical scheme, but health insurance can be used to cover day-to-day expenses.

Health insurance specifies its benefits and pays out a defined or fixed amount towards them. A health insurance plan does not have to include cover for the prescribed minimum benefits that a medical scheme is required by law to cover.

Top-of-the-range plans can include comprehensive day-to-day benefits and private emergency hospital stabilisation benefits. They do not provide cover for private hospitalisation apart from an emergency situation. You cannot claim a tax credit for your health insurance premiums.

Premiums for these plans range from R300 to R500 for the main member depending on the benefits. Note that waiting periods may apply as well as exclusions.

Sanlam Primary Care, for example, includes: unlimited visits to a contracted network GP; certain in-room procedures such as wound care and stitches; unlimited acute medication from a network GP or pharmacy subject to the approved formulary; unlimited chronic medication for diseases on the chronic disease list; basic pathology if referred by a network GP; x-rays; basic dentistry; basic optometry; two scans per pregnancy; R2 000 per annum for casualty room; and an accidental death benefit.

All of this would cost R317 per month for the main member, R207 for a spouse, and R148 for a child. A family of four would pay R820 a month.

There is an additional accident and emergency benefit which includes an in-hospital benefit of up to R225 000 per event, limited to R1 million. This is for accidents only. This would have an additional premium with a main member paying R385, spouse R280, and child R170.

This article first appeared in City Press


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Maya Fisher-French author of Money Questions Answered

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