Do NOT cancel your medical aid!
Before you take such drastic action, consider these ideas ...

This page is all about:

Are you considering stopping your medical plan and saving that premium to self-fund your medical cover?
THINK AGAIN because having no medical cover is a disaster!

Saving your monthly contribution might seem as a good idea, until a family medical emergency or hospital bill puts a BIG dent in your pocket.

do not cancel medical aidWill cancelling my medical cover save money?

A medical emergency can happen at any time – to anyone. A car accident happens within a split second, yet may take months and thousands of rand, for private hospital treatment, to recover from.
Unless you know this will never happen to you and your family, never - ever be without at least a private hospital plan!

Your two risks of high medical costs are with private hospital and dental treatments.
ONLY a medical aid can provide instant money to get you the finest care available!

No healthcare cover means:

  1. you have no financial help should you need to be admitted to hospital, or if you fall ill and need expensive chronic medication – like cancer treatment.
  2. you will need to pay a high deposit if you need to go to hospital.
  3. no ambulance will take you to a private hospital!
  4. you and your family's health is at risk!

Yes, South Africa does have state-run medical facilities, where you are charged according to how much you can afford, but these institutions are typically overcrowded and understaffed, so there’s no guarantee that you’ll get the care you need.

Even if you are prepared to make use of a state hospital, depending on what you earn, you may have to pay, as state hospitals are expected to charge households with an income of more than R72,000 a year.

A basic wisdom teeth removal can cost upwards of R 15,000! The total cost of antenatal care, delivery and postnatal care can range from R60 000!

Taking out a loan to pay back family members who may (or may not) help you financially, is complicated thing to do from a hospital bed! And the cost of borrowing money is huge.
This is a financial NO-NO!

A medical plan allows you to look after your family and focus on early treatments as opposed to waiting until someone is really sick.

There will be no long delays in your medical treatment, because you don’t have funds to pay for it. And early diagnosis and treatment of an illness is vital!

national health insuranceDo I wait for the NHI to start?

Don’t expect this to happen any time soon. The cost is just way to high for South Africa to afford. Whilst we need to have some sort of national health system, the proposed plan is not going to happen any year soon.

And any potential medical misfortune that may happen to you, will not wait for the NHI to be in place either!

Is the inflation rate a concern?

The rate of inflation increases prices of all commodities and health care costs are no exception.
However, medical inflation is way higher than general CPI!

Unless you are going to save a large amount every month and substantially increase it every year, you will never have enough saved to really protect you from high costs. Never!

How can Waiting Periods affect me?

All medical schemes are likely to impose waiting periods on new members (even if you were a member before). You still have to pay premiums, but can’t claim. And that can be for up to 12-months for specific conditions!

The sooner you join a plan, the lower the chance of a waiting period.
If you wait until you need a medical aid, the chances are you will not be able to claim because of waiting periods!

Is a Hospital Cash Plan (not a medical scheme hospital plan) worth it?

hospital planA hospital cash plan is uniquely different from a medical scheme hospital plan and it is important that you understand the differences if you are considering stopping your medical plan.

A medical aid plan – including even the most basic hospital plan – will cover most, if not all of your expenses, should you be admitted to hospital.

That includes in hospital doctors and specialists, your hospital stay and any take-home medication.

Medical schemes must accept any person who wishes to join the scheme (open enrolment). So your application cannot be rejected.

The scheme cannot exclude any condition that was not diagnosed or treated in the 12 months prior to applying to joining.

They must cover 270 life-threatening medical emergencies and 26 chronic conditions, irrespective of the plan you join.

They cannot charge different contributions for the same plan. Only if you have a late penalty or have joined an income-related premium plan can rates differ.

But, hospital cash plan is an insurance plan and can impose all the above points!

It only pays you a daily cash amount while you’re in hospital which is usually far less than the cost of a day’s stay in hospital and is regardless of the medical costs you have incurred!
Be aware, many people with medical insurance only discover on admission to hospitals that their medical costs are unlikely to be covered by the daily amount paid out by their hospital cash-back plans.

DANGER - Hospital cash plans do not cover medical expenses or the actual costs of an operation or a hospital stay like medical aid!

Medical Aid Hospital Plans are: Hospital Insurance Plan is:
Governed by the Medical Aid ActGoverned by the Short-term Insurance Act
Full PMB coverNothing
Unlimited, high in-hospital sub limitsLow rand amounts per day in hospital
Mostly unlimited in-hospital cover, and stated benefits or savings fund for day-to-day costs.Fixed or stated amounts of money for every day in hospital.
In-hospital and comprehensive plans (including day-to-day benefits).
Hospital accounts usually settled in full and related accounts (doctors and other providers) at scheme tariff.
In-hospital cover only.
Cash benefits can range from R200 to R5 000 pd.
Daily benefit is constant and not linked to the actual cost of treatment or medical bills.
Any private or listed network hospital.The daily benefit remains the same, whether a private or public hospital is used.
Accepted by private hospitals, so no deposit requiredOnly emergency accidents | Guarantee of payment needed before admission
3 and/or 12 months waiting periods, no pre-existing condition may be permanently excluded.
Start immediately where no waiting periods stated.
Most plans cover accidental hospitalisation from start of the policy.
Illness can be after either 6 or 12 months.
Can totally exclude conditions
Waiting period of a number of days spent in hospital – usually after 2 days.
Pre-existing medical conditions permanently excluded.
Yes for PMB'sNo to PMB's
Comprehensive major medical coverRand amount or number of annual events
Comprehensive dread disease coverRand amount or number of annual events
27 Chronic conditions coveredNothing
Payment usually directly to the hospital and providers.Payment directly to the member, who must settle accounts.
Hospital cover usually unlimited. Hospital cover usually for a fixed limit, which may not be sufficient for extended hospitalisation.
Open enrolment with no age limitation.Limited ages.
Medical schemes are non-profit organisations. Short-term insurers are for-profit companies.

Please note that not all aspects have been covered above and the information provided is neither a complete report/analysis nor is it intended to flout or in any other way compromise the conditions set out in the Financial Advisory and Intermediary Services Act’s General Code of Conduct insofar as comparing different financial products with each other icerned.s con

So, what's the alternative?

If you are considering giving up your medical plan, it’s worth looking at any other avenues to save money, rather than cancelling your health coverage.

Healthcare cover should be the last expense to consider cutting, because the threat of high medical treatment costs is so great!

private hospital planWhy not join a PRIVATE HOSPITAL COVER ONLY plan and pay your out of hospital costs yourself?

Join a plan that protects you from the 2 greatest threats of high medical costs we face - private hospitalisation and dental care. You control your out of hospital costs through your own savings fund.

If you cannot afford a comprehensive medical plan, then you MUST AT LEAST HAVE THIS PLAN, because it offers you cover for your greatest threats of high medical costs like:

hospital planHere’s what you should do….

BUY A HOSPITAL AND DENTAL ONY PLAN (From R 1,340 pm. Family R 3,560 pm)

Add a Top Up/Gap plan to it for around R 412 pm.

Now you will have the finest cover paying up to 5 times medical scheme rates in hospital!
At the lowest cost we know of!

Take the difference in premium that you would have been paying (or any amount you feel comfortable saving) and save that yourself in a bank savings,
until you have an amount - say equal what you spent out of hospital last year - that you feel is enough.

Invest into a unit trust after that. You’ll have an investment you can use for future dreams and goals – again that you can get to at any time.

Go even better…save the money into your access type bond…if you have one. Now you are cooking! The power of compound interest really works for you if you pay more off against your home loan than you have to.

That’s serious savings over the longer term!

  1. You now have a no overall annual limit – in any private hospital plan, with no shortfalls and co-payments!
  2. You have an “emergency fund” you can instantly pay medical costs with.
  3. You have a unit trust investment with all those attractions like paying kids education fees, or a deposit on a new car, or best of all, a retirement saving!
How is that for a plan!

top up
Private provider fees are not regulated and many can charge up to 500% of the medical scheme rates!
Some plans pay claims at 200% or 300% of medical aid rates, offering you a lower claim shortfall, but these are more expensive.

Increasingly, plans also have procedure co-payments, which you have to fund.
You are strongly advised to consider a GAP or TOP UP insurance plan
to address these threats.

This separate insurance plan will cover most in-hospital claim shortfalls and scheme co-payments.
By adding a Top Up plan you can improve your medical aid benefits, so-much-so, that you can even consider joining a lower cost/benefit plan - with a lower premium - and still have an excellent, no risk medical aid for virtually the same premium as the higher medical aid!

top up
Specialised 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!

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TALK TO ME .... I am here to help you - AT NO CHARGE!
Send me your questions and concerns. I'll answer them for you.

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You must consult the schemes/company product brochures and rules for comprehensive benefit descriptions.

income protectionMedical aid pays healthcare costs.
What if a disability STOPS your income?

peter pyburn brokerpeter pyburn

Last update: July 11, 2021


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