What are the different types of Medical aid?
How will a Medical Aid plan help you?
Advice on the various benefits, networks and premiums available.
This page is all about:
- What type of healthcare cover do you need?
- What is a Comprehensive Medical Aid Plan?
- What is a Hospital Plan?
- What are Income-related Premium Plans?
- What Benefits do Student Plans Offer?
Healthcare is expensive, but so necessary if you want to be able to immediately afford the finest medical care. And that is key to a fast and effective recovery from accidents and illnesses that require care.
In order to find and join the best plan for your needs and budget, you must have a basic idea of what types plans are on offer and how they are structured to help you meet the risk of high medical costs.
Our need for medical care can be divided into:
- Hospitalisation - our greatest finncial risk lies with the costs of Private Hospitalisation. We have no idea when we will need hospital care, for how long that may be, nor how much it will cost.
You need unlimited hospital benefits. - Out of hospital treatments - routine care like doctors, dentists, medicines and glasses, are generally not frequent needs, but do have to be paid for when they happen. And we need funds on hand to be able to afford the best care.
There are various ways to cover out of hospital expenses and it is here where you can save premiums by choosing the type of plan you want to join. In an attempt to fight the high costs of healthcare - but still have protection against high private care expenses - many members are joining only in hospital benefit plans and self-funding day-to-day costs.
- Chronic illness - is long term, constatnt medical treatment and medication. These costs can be extensive over time.
Medical schemes offer plans that cover these vital areas of need.
In return for a monthly premium, they offer financial insurance cover for any medical treatment and related costs you may face.
There are 3 main types of medical aid plans to consider:
1. Traditional
You have hospitalisation and day-to-day costs paid by the plan. A portion of your premium goes to a common pool of funds within the medical scheme, for all members of that planYou have set amounts and limits for specific benefits like 10 GP, 2 dentistry, one optometry visit and R 5,000 for medicines or you may have an annual day-to-day limit for most benefits together. Once the specific benefits are spend, you pay further claims for that year.
Some plans offer additional benefits like GP or dentistry, so you do not use your limited set benefits for these treatments.
This prevents a situation of having used all the benefits on one condition, with nothing left for other healthcare needs - as can happen with saving plans. These plans use a form of cross-subsidisation to manage claims.
These plans are suitable for members who have a high need of medical services on a monthly basis. GP, medicine, dental etc. visits.
Advantages: If you use one benefit, it does not affect the others. You know exactly what benefits you have at any time.
Disadvantages: Benefits do not roll over to your next year, so if you do not use them, you lose them. That is a waste of money!
2. New Generation
Gives you hospitalisation paid by the scheme and day-to-day benefits paid from a personal medical savings account.The savings account is made up of an interest-free loan paid to you at the beginning of the year. You pay it back through an additional portion added to your premium every month - whether you spend funds or not.
You can only spend it your medical needs and there is no cross-subsidiatation amongst other members.
Fedhealth medical aid offer innovative and attractive ways of working these savings and you can save a great deal of premium with them!
Most plans offer a safety net (threshold benefit) should you have spent your savings and still need cover. Once your claims add up to a pre-determined amount, they pay further costs that year subject to some limits.
Genesis medical aid pays essential dental costs, so you don't use your savings on these claims!
These plans are suitable for healthy members who do not use a great deal of day-to-day medical services, but do want the security of knowing that if they do need funds for high claims, they have them.
If you have high dental or optometry needs (where sub-limits of a particular medical aid are insufficient) the ability to use more savings on certain costs is ideal.
Advantages: You have the discretion to spend your savings as you want and any unused amount is carried over to your next year.
strong>Disadvantages: You could spend your total savings on one claim and then have nothing for the rest of the year. Or, one family member could spend the entire savings, leaving the rest of the family without cover. You need self-discipline to effectively manage these plans.
There are also options that use the best of both Traditional and New Generation plans. They have both set benefits and savings all in one plan.
3. Capitated or Network
These plans require you to use a network of designated service providers, (both in and out of hospital) who are linked to the medical scheme.For that, you get a discounted premium. (In an emergency you should be able to use any hospital, but please check with the plan rules.)
Some plans have premiums based on your level of income.
These are the lowest cost medical scheme plans available. However, they can be restrictive in the benefits they offer, but do offer life-threatening and life-sustaining benefits for extremely good rates!
These plans are ideal for pensioners, children who become adult dependants on your healthcare plan, students and those who earn low-incomes, but want access to private healthcare
A Comprehensive Medical Aid pays both in and out of hospital costs.
They are the most expensive of plans because they offer the widest amount of benefits.They typically have no overall limit hospitalisation, excellent set benefit amounts or high savings for day-to-day needs and the highest number of chronic illnesses medications.
Comprehensive Plans are designed for those who have (or expect to have) high medical expenses or who want the security of knowing they are fully covered should ill health occur.
Members and families who want the security of knowing high medical costs associated with children are covered and the elderly, who have higher needs for medical treatments, are catered for.
Hospital plans are designed to meet the need for high cost, elective and emergency private hospitalisation and essential chronic illness treatment.
Most medical aids offer these plans.They offer the best method of controlling medical aid costs, by "insuring " for the greatest medical financial risk we face - private hospitalisation - whilst you self-pay for your day-to-day costs.
They are recommended for those with a strict budget or healthy members who have little need for out of hospital cover.
Benefits include all planned and emergency, in hospital costs from admission to discharge. That includes ward and theatre fees (which are normally fully covered), anaesthetist and surgeon, pathology, physio and other providers.
Unless you are admitted immediately after casualty treatment, most plans do not cover casualty costs.
Here is a plan that does pay casualty ward costs, as well as 30 days post-hospital costs for certain treatments and allows an upgrade to a higher plan if you suffer a defined life-changing event!
There is a hospital plan that will pay essential dental costs as well, further reducing the risk of self-funding out of hospital costs!
Plans may also offer specific maternity, chronic illness programmes, screening and preventative care benefits.
Some plans offer unlimited cover at network hospitals.
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!
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!
Why not invest in a hospital plan and create your own day-to-day savings fund... open a bank savings account, or use your home as an access bond – pay extra into it and use that for day-to-day expenses?
Hospital Plans with Day-to-Day Savings
Expensive healthcare treatments can occur outside of hospital. If you feel you may need help with these types of expenses, but do not require a comprehensive plan, there are hospital plans that offer day-to-day benefits.All in-hospital costs are covered as with hospital plans. There are two ways out of hospital claims are paid:
- by way of defined, limited benefits, funded by the scheme itself or
- by way of a savings fund.
An example of a scheme with hospital and defined day-to-day benefit plans.
Example of a hospital and saving fund plan.
In fact Discovery Health's KeyCare Plan has more members than most total medical aids!
The plans offer hospital, day-to-day and chronic illness cover using a network of providers. They can include day clinics, maternity, HIV, cancer, diabetes and mental health programmes, preventative and screening and even home-based care benefits.
Momentum Health's Ingwe plan covers the use of any hospital, or a network of hospitals for a further premium discount, or state hospitals with the lowest of all premiums.
These plans offer life-threatening (heart attack, car accident etc.) and life-sustaining (cancer, kidney etc.) benefits for a very affordable premium, which you do need to prove!
Full time students also have access to medical aid.
Benefits include unlimited hospitalisation at any hospital (including casualty), mostly unlimited basic day-to-day cover with network providers. Dental and optical benefits are included.
This medical aid is recognised by Home Affairs for study visas that International students require. And we can get you your certificate in a very short time!
bestmedicalaid.co.za can help you identify and join one of the top medical aids in South Africa!
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You must consult the schemes/company product brochures and rules for comprehensive benefit descriptions.
Medical aid pays healthcare costs.
What if a disability STOPS your income?
Last update: July 26, 2021
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