What to do about your Medical Aid (in 2022)

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Good Healthcare costs money!

When you are ill or have an accident, you want the finest care you can get.
For most of us the only way to secure that private healthcare is by way of a medical aid.

high medical costsThe Covid pandemic is not over. With costs exceeding R350 000 for ICU oxygen therapy – per a leading medical aid - you need to be a medical aid member to afford immediate and professional care!

The chances of needing medical care is now greatly increased for all of us, not only due to the possible side-effects of the virus, but also because we are slowly returning to a normal way of life.
All the “old” reasons for needing healthcare are still there.

With so many medical schemes and numerous plans from which to choose, it is extremely difficult (and confusing) to understand what is on offer and make a decision.

Use us to help you select an affordable plan that meets your needs and wants. We have years of experience with clients who face what you do.
And we have helped them reduce that stress of worrying about the “what if’s” around medical aid.

Here are some essential points you need to be aware of when looking for a medical aid plan in 2022.

high medical cost risk

Your healthcare funding risk

We face 2 main areas of high healthcare costs and these are some concerns you need to be aware of:
  1. In-hospital – where you want the finest in private healthcare.
    It must be immediate in the case of an emergency.
    You need guaranteed private hospital admission.
    It needs to have no overall annual limits.
    You need casualty benefits.
    Specialised radiology can be very expensive, so you need cover.
    Day ward, day clinics and certain procedures done in a doctor’s room must be covered.
    Other major considerations are:
    Follow-up treatment for 30 days after discharge from hospital, like physio, x-rays and pathology to be paid by the scheme.
    Pregnancy and Maternity as these can cost upwards of R 60,000 for a normal private hospital delivery.
  1. Out of Hospital (Day-to-day benefits)
    Most medical aids pay these from a fund of savings – which is really your money.
    You are provided with a fund that you pay back as part of your monthly premium, whether you spend it or not.

Here is a scheme that allows you to reduce your premium by only paying back the savings fund when you spend it. So, if you do not spend savings, your premium is lower! But savings are always there should you need them.

You need enough of a fund to cover unforeseen GP, dentist and optical treatments.

Here is a scheme that pays dental benefits from a hospital only plan, making your savings last longer!

If you have high out of hospital expenses, then a comprehensive medical aid, with a savings fund that has a safety net should you spend the full fund is an option. They are expensive, but may offer value if the annual premium is less than your total annual day-to-day spend.

Here is a scheme with a savings, that has a safety net should you spend all the savings.

MRI/ CT scans done out of hospital are expensive!

Here is a scheme that pays MRI and CT scans if done in or out of hospital!

It is vital you have check-ups. Prevention is indeed better than cure. And within specific limits, a medical scheme will pay for these check-ups.

Plan upgrades

Our health is dynamic and it can drastically change from day to day. However, when you join a medical aid, that decision is mostly based on today’s situation.
But, what about unforeseen future healthcare risks from simple ageing? How do you address that?

It is important to re-consider your medical aid at least every year.

Medical aids allow an unrestricted upgrade of plans (and benefits) once a year.
What if you face high costs mid-year and need greater benefits and limits? It can be an expensive self-payment risk to absorb.

Here is a scheme that allows an upgrade to a higher option within 30 days of a life-changing event, like a pregnancy or the diagnosis of a dread disease.
Now you do not have to pay for an expensive plan because of a future “what-if."

high medical costs

The threat of a delay when joining a plan

Delaying joining a medical aid can be detrimental to your health and your wallet. Why?
Because when you join a medical aid, you face 2 types of waiting periods, enforced by the Medical Schemes Act.

Waiting periods

  1. If you have not been a medical aid member for 90-days before joining, you will have a 3-month general waiting period during which no claims will be paid (including Prescribed Minimum Benefits.)
  1. If you suffer from any medical condition when joining, you may have a 12-month waiting period.
    Premiums must be paid during a waiting period.

Late joiner penalty

When looking at a medical aids, it is best to plan ahead and join when you’re young and healthy, rather than waiting and then having to pay more on your premiums when you’re older.

Because medical aids operate on the basis of cross-subsidisation, those who choose not to belong to a medical aid earlier in life can be charged a Late Joiner Penalty when they ultimately apply for membership.

Where a member is age 35 years or older and has not been a member of a medical aid before 1 April 2001, or where there has been a break of longer than three consecutive months, the scheme can charge a late joiner penalty.
Depending on your age and break in membership, your premiums can be loaded between 25% and 75%!

How a medical aid works

A medical aid can be divided into 3 parts: In hospital, out of hospital and chronic illness benefits.
  1. In Hospital benefits provide cover for in-hospital treatment only like theatre costs, X-rays, medication, blood tests, and blood transfusions done in hospital. Some procedures done out of hospital may also be covered.

    Increasingly, procedure co-payments are being levied to lessen the cost to medical schemes. Gap or Top Up cover is now a vital medical aid add-on and it is highly recommended you investigate the product!

  2. Out of hospital (Day-to-day) benefits are treatments that are not included in the hospital or the risk component of medical aid, such as dentistry, optical, GP consultations and acute medication.

high medical costsMost plans include a savings fund from which you pay these costs, while other plans have set benefits and limits paying these claims.

If you join an In-Hospital only plan, which does offer the lowest premium while providing vital protection against high healthcare costs, you will need to fund all your day-to-day expenses. There are products to consider that will help you accumulate funds for these costs.

A Medical Savings Account is a fund that you pay for as part of your premium.

It is used to pay day-to-day healthcare costs in accordance with the rules of the scheme.
Once spent, you either self-pay further costs or, on more expensive plans, have a safety net (Threshold benefit) that will fund further claims for that year. You may have a self-payment gap before the threshold benefit is effective.

3. Chronic illness benefits cover expensive, ongoing treatments and medicines as a result of long-term health conditions. Medical aids must pay for 27 essential chronic conditions.
More expensive plans offer cover for more conditions.

Read more on Types of Medical Aid...

How to reduce your costs

Because medical aids are “not for profit” companies, they need to fund expenses from member contributions and investment returns only.
In addition, healthcare costs increase annually at a rate far higher than standard inflation. These factors, result in high medical aid premiums.
However, there are some ways you can consider reducing your healthcare costs.

In-Hospital only plan

Why not consider buying an in-hospital only medical aid?
Then, you add a savings account to use for medical costs, creating your fund for day-to-day medical costs.

The combined premiums are CONSIDERABLY less than a comprehensive medical aid with mostly equivalent hospitalisation benefits.
And YOU control your savings account!
However, it still meets your # 1 risk, that of high private hospital costs.

In hospital only plans range from a network option (using listed hospitals) limited to 100% of what a medical aid pays, to fully comprehensive hospital cover that pays up to 300% of the medical tariff.
It is therefore vital that you know what rate your plan pays, as you could be exposed to claim shortfalls.

They also offer chronic illness benefits.

Here is a scheme that pays dental benefits from a hospital only plan.

The hospital and dental benefit plan will offer you the finest any private hospital cover and essential dental expenses cover and at a very affordable premium - way less than any other medical aid!

Seriously consider the Fedhealth flexiFED plans.
These plans are essentially in-hospital only plans. But, they do have the option of using savings for day-to-day costs - that you only repay ONCE YOU USE THEM.
This is the only scheme to give you control over the cost of your medical aid!

Network plans.

If you are prepared to use listed hospitals, you get discounted premiums. The medical aid can negotiate fees with providers and pass that onto members in the form of lower premiums.

Designated Service Providers (DSP) are chosen providers within a scheme.
If you use these providers, your claims are generally fully paid and you do not have to fund any co-payments, saving you money.

Income-related plans.

These are network plans, where you only use listed private hospitals and day-to-day providers (including GP's specialists and gynaecologists).
By accepting this, you get a discounted premium!You get, unlimited hospitalisation, casualty benefit, GP visits, prescribed medicines and basic dentistry, optical and preventive screening tests and flu vaccines benefits!

medical aid quoteWhat is the cost.

top-upPrivate healthcare providers can charge up to 500% of medical scheme rates.
Medical aids add procedure co-payments as well.
These are significant concerns for medical aid members.

Protect yourself against these potential threats, by joining a GAP or top-up insurance plan.

This separate insurance will cover most in-hospital claim shortfalls and any co-payments. It is a vital safety net, ensuring you have adequate benefits for medical treatments without bearing the full burden of unexpected costs.

Protect yourself from soaring medical expenses by bridging the gap between medical scheme rates and the charges imposed by private providers.

dentalSpecialised Dental treatments can be extremely expensive!
The costs of braces, root canal, implants and so on, can run into thousands of rand. Most treatments are done out of hospital, so are funded from your savings. That can result in less money available for other medical needs and family limits being used on one member only!

Dental treatment is something we all need and it is vital you consider the Best Dental Insurance Plan in South Africa.

No Medical Aid or have a Hospital Plan only? This plan will help you meet the high costs of both normal and specialised dentistry!

Please remember that a good hospital plan will cover your area of greatest medical financial risk and given the certainty of rising prices with health care this is fast becoming the plan option of choice!

We are here to help you, often at no cost, every step of the way!

medical aid quoteWhat is the cost?

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peter pyburn brokerpeter pyburnPeter Pyburn - Authorised Financial Services Provider, fully licensed to render financial services since 1991. Death and Disability Planning; Retirement Planning; Investment Planning; Healthcare and Estate Planning. More...


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Last update: April 1, 2024