Our government has announced plans to roll out National Health Insurance (NHI) that will provide quality healthcare services to all. This is exciting news, but the project faces some serious implementation challenges that could take several years to overcome. In the meantime, having private medical insurance continues to be an important part of South African life.
But with so many medical aids on the market, how do you choose?
Understanding medical aid
The popular belief is that a medical aid is a care package designed to treat you when you’re ill. You’ll be able to make better choices if you understand that it’s actually an insurance policy against a disaster scenario – in many ways no different than having cover against your house burning down.
Many people think of medical aid as paying in advance for a service that you’ll use later, like cellphone airtime. In fact, you’re buying something a lot more specific, so, to get the best value, it’s important to think about what you’re likely to need.
How much can you spend?
Before you look at your options, decide how much you can afford to spend. Medical aid isn’t cheap, and it’s pointless spending time comparing types of cover that you can’t afford.
It’s worth bearing in mind that at this time, your medical aid contributions are a pre-tax deduction, which may help balance things. However, when the NHI eventually rolls out, medical aids will no longer enjoy this privilege.
What about hospital plans?
As the cost of medical care continues to climb, many people are choosing hospital plans. These are entry level medical aids that cover you in the event of an emergency hospitalisation. It provides for scenarios such as getting hit by a car, but won’t cover a long-term illness such as cancer or HIV.
Whether or not this is enough for you depends on your lifestyle and the amount of disposable income you have. Choosing a hospital plan means you’ll be paying for regular visits to the doctor yourself, for example. That’s probably fine if you’re single, but it may not be the best approach if you have dependents on your plan as well.
Ask about their performance
It seems that these days we should expect a certain amount of resistance when claiming from an insurer, but it doesn’t help to be on a medical aid that won’t pay out when you really need it to. The best way to find out how medical aids perform is to ask a service provider that gets paid by them.
Since most doctors have systems that automate medical claims, phone your GP’s receptionist and ask which medical aids they find pay out best. Any medical aid with a high rate of rejections or refusals on technicalities is not a medical aid you want to be on.
What do they cover?
Educate yourself on what your plan will and won’t cover. You may find, for example, that a particular medical aid will claim to cover you up to 100% of “medical aid rate”. That sounds like you’re protected, but you aren’t.
Medical aids have a list of tariffs for each possible procedure that has been negotiated with specific service providers. The list has no relation to what those procedures might cost anywhere else, such as at a private hospital. If you’re on one of these, you may only use their designated doctors, or if you don’t, you must pay the difference yourself.
If you think it’s likely that you’ll need frequent care, or often travel far from one of their approved hospitals, it’s better to choose a scheme that will cover what your treatment will actually cost.
If you’re going to buy medical cover through a broker, choose one that isn’t directly affiliated with any medical aid. That way you can be reasonably sure that the products you’ll be offered won’t all be from the same provider.
Don’t base your decision purely on cost. It’s worth asking about the solvency of the funds you’re looking at, something a broker will be in a position to advise you about. Low premiums won’t help if you join a medical aid that’s about to go bankrupt.