If you are considering moving schemes or looking to take out a medical scheme plan for the first time, you need to consider the viability of the scheme as a whole and then select the plan that best suits your needs.
THE HEALTH OF THE SCHEME
Jill Larkan, head of healthcare consulting at financial advisory firm GTC, says that when selecting a medical scheme for clients, they always consider the sustainability of the fund in the long term.
“On a micro level, we compare the premiums in the relevant categories and then we look at four major macro criteria,” says Larkan, who explains that the macro criteria provide a good idea as to the sustainability of the fund and whether or not it will be able to contain premium increases going forward.
The GTC Medical Aid Survey looks at the solvency ratio, the average age of the members, the number of members, as well as the pensioner ratio. They also attribute a score on whether or not these figures are on an increasing or decreasing trend.
For example, a fund may have a relatively large member base with a relatively low average age, but over the past few years its membership has been declining and the average age increasing.
A fund is more likely to be sustainable if it has a solvency ratio of at least 25%, a relatively low average beneficiary age (37 years or below), has a broad membership base and a relatively low pensioner ratio (less than 7.7%).
SELECTING THE RIGHT PLAN
Once you have selected the medical scheme, you need to ensure you are on the right plan for your needs.
Chronic cover: If you have a chronic condition that is not part of the Prescribed Minimum Benefits, you need to ensure that the fund covers your condition. If you do require expensive chronic medication, select an option that makes it easy to collect your medication. If you do not have a chronic condition, then you can save premiums by opting for a plan that requires chronic medication to be collected from the state.
Pregnancy: If you are planning on starting a family, find out what cover is provided for both pre- and antenatal care.
Also be aware that if you are joining a new scheme, a waiting period may apply. Although your pregnancy may not be covered, your child will have medical cover. This is very important in the case of a premature birth.
In-hospital cover: At what rate will the medical scheme refund your hospital bills? If it is only 100% to 200% of the medical scheme rate, you may need to take out additional hospital gap cover.
Co-payments: Find out if your plan has co-payments for certain procedures and be aware of the fact that you may need to pay towards the bills in the event of a medical procedure.
Waiting period: If you know that you or a family member will need medical treatment in the course of the year, find out if exclusions exist for pre-existing conditions.
Exclusion or waiting periods can vary from three to 12 months.
Above-threshold: If your medical costs generally exceed your medical cover each year, then opt for a plan that offers above-threshold cover that will pay out at medical scheme rates once you have exhausted your medical savings.
Note that a self-payment gap will apply and know what that gap is.
Is your doctor on the network? Many medical schemes offer significant premium discounts if you agree to use hospitals, specialists and GPs on their network. These providers are contracted to the medical scheme and have agreed to the fee schedule.
Does this plan meet my family’s needs? Does the scheme have an unlimited GP benefit for consultations at a nominated GP, even after your savings are used up?
Does the scheme have extended chronic cover for childhood illness such as eczema, acne, ADHD and allergic rhinitis? Are visits to the emergency room for the inevitable stitches covered from risk or day-to-day savings? Up until what age can a child remain on the scheme?
When reviewing your existing medical option, check whether or not cover has been reduced. In order to keep premiums down, some funds may cut back on the conditions they cover or increase their co-payments.