This addition to our “15 Series” is based on contributions by the Virtual Adviser team of Professors, experienced Medical Doctors, esteemed Health Professionals and Certified Financial Planners. It is profoundly insightful. Every person who is covered by medical aid in South Africa should read it.
- “Unlimited hospital cover”
This is a common advertising strategy used by open-to-the-public medical aids (such as Momentum and Discovery), however it is not true. In fact, medical aids place many limits on hospital cover. There are limits to the diagnoses that will be covered, which hospitals and doctors you can use, and what they will pay for while you are in hospital, even on their highest options. If the medical aids indeed had “unlimited hospital cover” they would go bankrupt in little time.
- “Popular open to the public medical aids are better than my employer’s medical aid”
In almost all cases being part of a restricted-entry or employer medical aid will provide you with better benefits, more care and compassion than an open-to-the-public popular medical aid brand. Our team of Financial Planners will show you the massive differences in their benefits. Contact us by clicking here.
- “Having a medical aid means I will never have to use a government clinic or hospital”
You might think that the reason medical aids exist is to help you avoid the apparently failing government clinics and hospitals, where care is believed to be inferior. You will be surprised to learn that some medical aids have contracted with government hospitals, and thus members may be forced to use a government hospital. Also, some medical aids are exempt from the Prescribed Minimum Benefit (PMB) laws and you may have to be transferred to a government hospital once you have reached your benefit limit.
- “Medical aids make a profit”
All medical aids in the Republic of South Africa are registered as not-for-profit organisations. Medical care is expensive and medical aids struggle to maintain their reserves each year. The ones who can potentially make a profit are the administrators of the medical scheme, who sometimes sneakily share the same name as the medical aid, and negotiate higher-than-normal monthly rates for their services to the medical aids.
- “The best way to judge if a medical aid is cheap is to look at their percent increase each year”
The best way to illustrate this myth is to use an example. Let’s compare two hypothetical medical aids, MedBig and MedSmall. MedBig does a large expensive media campaign about their “only 5% increase” while MedSmall gets bad exposure because they are increasing their monthly contributions by 10%. You might think that MedBig is the cheaper option. However, comparing like-for-like options this year MedBig charges you R1700 and MedSmall charges you R1500 for the same type of benefits. So a “small” 5% increase on MedBig means you will pay R1785 next year, while a “big” 10% increase on MedSmall translates to you paying only R1650 next year. MedSmall is still cheaper.
- “All medical aids are the same”
Many people believe that all medical aids are forced to comply with a legal “prescribed minimum benefit”, and are thus all the same. The massive difference lies in what other services they will pay for, in addition to the “minimum”, and how much effort they will put into keeping you healthy, instead of just paying for the minimum when you get sick. Some medical aids are genuinely invested in trying to make all their members healthier, while others are only trying their best to limit what they will pay, in order to reduce their expenditure, maintain their financial reserves, and reduce yearly percent increases.
- “Medical aids will cover everything”
Even the highest options on medical aids have strict limits to what they will pay for, where they will pay for care, and when they will pay. The majority of the members of most medical schemes are young and healthy and the benefits they use are usually not covered, or are paid from medical savings (their own money). Common examples are visits to a doctor for a flu, or having your teeth cleaned at a dentist.
- “Medical insurance is the same as medical aid”
There are many popular products in the market that appear to be medical aids, but are not. Many insurance products from well known companies offer to pay for medical care. Make sure you ask your Financial Planner if he is selling you medical aid or insurance. The insurance products are not subject to the laws that protect medical aid members. Make sure you understand what you are buying.
- “Prescribed Minimum Benefit (PMB) laws will protect me”
The PMB laws were drawn up decades ago, and in many cases don’t make sense. For example, the PMB laws make it compulsory for a medical aid to pay for your admission for severe depression, but the medical aid is not obligated to pay for your medication once you are discharged. You might deteriorate without medication and end up in hospital again, and the medical aid will be obligated to pay for another hospital admission. It makes very little sense. Learn more about PMB from the CMS webpage.
- “A hospital-plan type of medical aid will cover only hospital admissions”
Every medical aid option must cover all 27 diagnoses on the Chronic Disease List and all 270 diagnoses on the Diagnosis Treatment Pairs list. The treatment of many of these diagnoses must include out-of-hospital care. This means that there is no such thing as a hospital-plan. Ask us about what you are missing out on by clicking here.
- “If my employer has a medical aid, I can’t be part of another medical aid”
Even if a condition of your employment is to be part of your employer’s medical aid, there is a way that you can legally be allowed to be a member of any other medical aid. Want to know more? Contact us by clicking here.
- “I can change my medical aid plan/option anytime I want to”
Most medical aids only allow changes at a specific time of the year. Some allow downgrades at any time, and many don’t allow upgrades until the end of the year, even if you need to upgrade to access more medical care and are willing to pay more for the upgrade. You need to be on the correct medical aid option today. We will help you.
- “I can join a medical aid when I know I will need medical care soon”
Almost all medical aids have waiting periods and other penalties for people who choose to join a medical aid only once they know that they will need medical care. The law allows medical aids to even block you from claiming funding for life-saving treatment in these situations.
- “All financial advisers know medical aids very well”
Medical aid is very complicated and most seasoned financial advisers are clueless. Make sure your health broker is highly qualified, able to understand these complicated topics, and has an experienced medical doctor advising on what happens in practice. Virtual Adviser has access to such experts. Contact us by clicking here.
- “Medical aids will still exist, even if National Health Insurance (NHI) eventually arrives”
One of the main intentions of NHI is to make the medical aid industry redundant. This is planned to be done by pooling the entire healthcare fund in one place, the NHI fund, and paying for quality healthcare for every South African. If the government succeeds in doing this, there will be no need for medical aid. However, few have confidence that the government will pull this off successfully, therefore the medical aid industry goes on with business-as-usual. You still need medical aid.