The Covid-19 pandemic has taken an enormous toll on the country's economy, which has meant that many South Africans have lost jobs, taken salary cuts, or have not received annual salary increases. Therefore, families have to tighten their belts and look at ways of making their household rands stretch even further.
It is encouraging to know that we can all assist in containing healthcare increases and improving outcomes.
Healthcare costs are ever-increasing, and managing them can help to ease your financial burden. Lerato Mosiah, chief executive of the Health Funders Association, an industry body representing medical schemes and medical scheme administrators, offers the following advice.
1. Make sure you understand your benefit option
Understanding the medical scheme plan or benefit option that you’ve chosen, knowing what it covers and ensuring it suits your needs, in accordance with your health status, is essential. Read your benefit plan guide and, if necessary, speak to a scheme representative or a financial adviser who specialises in medical schemes.
2. Make use of designated service providers (DSPs) and networks
Your medical scheme is likely to have set up networks and nominated DSPs for your benefit option. These could include doctors, pharmacists, optometrists, hospitals and other healthcare providers and facilities. Medical schemes do this in order to negotiate the best possible rate for healthcare services for their members. These network arrangements may also assist in measuring the quality of healthcare to ensure the best care for members.
The rates charged by network providers or DSPs will normally be paid in full by your medical scheme and therefore you will not be required to make a co-payment on top of what is paid by your scheme.
3. Don’t pay more than necessary for medicines
Making use of generic medicines can save you money. Generic medicines contain the same active ingredient as their branded counterparts but are generally much cheaper.
Should you suffer from one of the 26 chronic conditions (including HIV) or any of the 271 medical conditions included in the Prescribed Minimum Benefits (PMBs) issued by the Council for Medical Schemes, your medical scheme will cover the cost of the medication in full as long as you use a medicine on the approved list of medicines used by your medical scheme, called a “formulary”.
Most will also require that you have your medicine dispensed by a pharmacy nominated by your medical scheme. Should you choose to use medicine that is not included on this formulary, or have it dispensed by a non-network pharmacy, you may be expected to pay the difference or even the entire amount. In cases where your doctor decides that you must use a different medication from the formulary medicine (and your doctor can prove that the medication on the formulary list is ineffective or detrimental to you) your medical scheme may pay for the prescribed alternative treatment.
It is important to register your chronic condition with your medical scheme so that it can help you manage your condition.
4. Minimise shortfalls
If you need to be admitted for a planned procedure in hospital or require specialist treatment, it is a good idea to first get a quote from your health provider and check with your medical scheme as to whether there will be a shortfall.
Your doctor is often willing to negotiate a better rate when you ask. If you are on an option with a medical savings account (MSA), some of the shortfall may be covered by the funds within your MSA
Remember that you must obtain pre-authorisation from your medical scheme before admission. Pre-authorisation is not the same as a guaranteed payment, though, so take care to follow the required steps.
5. Go to your GP before seeing a specialist
Many of us go straight to specialists when we have a health concern. However, did you know that your GP is very well-qualified to conduct an examination for most health conditions, and either prescribe an effective treatment or make sure you are directed to the most appropriate specialist?
This could save you time and money as you may only need your GP’s treatment. It is important to visit the same GP that you trust, where possible, as the doctor builds your health history, which provides continuity of care and enhances your health journey.
6. Use your medical savings account (MSA) wisely
Some benefit options cover day-to-day benefits through a MSA. Most of the funds collected by the medical scheme are placed in a general risk pool to pay for major medical expenses for members. A portion of your contribution – up to 25% - may be kept in a separate account, depending on the benefit option’s rules.
MSA funds are for exclusive use by you and your dependants for day-to-day medical expenses and co-payments. Medical schemes may allow for an annual advance allocation to your MSA. This means that if you need treatment in January for a medical condition not included in the risk benefits, you will have access to 12 months’ worth of savings to use for your medical needs, which will be recouped through your monthly contributions over the benefit year.
These options place the responsibility to manage the care you access on you and, therefore, need to be utilised wisely. For example, it can be tempting to buy fancy new spectacles at the beginning of the year only to find that there are no funds for dental treatment required later in the year. Unused funds in your MSA will be rolled over to the following year, so you never lose them, and accumulating a healthy balance in your MSA is wise for times when there may be specific healthcare needs not covered by your medical scheme. If you leave the medical scheme or change options and move to an option without a MSA, the balance will be refunded to you after four months.
7. Understand what’s behind medical scheme contribution increases
Most insurance, including healthcare cover, is a grudge purchase and many people feel that to get the best out of their insurance, they should claim as much as they possibly can. Medical schemes, though, are not for profit organisations and are like ‘stokvels’ in some respects, working on the principle of cross-subsidisation.
Apart from paying for running costs and legislated requirements, medical schemes pay almost all their member contributions out in medical claims each year. Annual contribution increases are therefore directly reflective of healthcare inflation, which is usually significantly above CPI (Consumer Price Index inflation) and driven by:
- The tariffs charged for healthcare services;
- How people utilise healthcare (by going straight to specialists and using benefits as an annual shopping list, for example);
- Demand for healthcare driven by suppliers; and
- An increase in chronic conditions, a significant portion linked to lifestyle choices.
Benefit options differ between medical schemes. So, if you are unsure of the benefits you’re entitled to or what your scheme will cover, contact your financial adviser, if contracted by your scheme, or your medical scheme directly for first-hand information.
“Using benefits wisely and making smart choices when it comes to managing your health expenses will assist in containing the ever-increasing healthcare expenditure,” says Mosiah.