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We have all questioned whether we should continue paying medical aid premiums each month just for us to be rejected when we do submit a claim. Before booting your medical aid membership, it is important to understand the principles this industry is built on and what role it plays in our society.
Medical aids are regulated by the Medical Schemes Act and put obligations and requirements on medical aids with the goal of making medical care affordable and accessible to all members. This legislation also aims to ensure that the member is not taken advantage of and that medical aids can only operate if they are licensed to do so.
One of the most important obligated put-on medical aids is to provide members with Prescribed Minimum Benefits (PMB). These PMB must be provided to all members without discriminating which means that all members will have to pay the same price for any given plan regardless of their medical needs and health conditions.
The PMBs that medical aids have to cover are any costs related to the diagnosis, treatment and care of any emergency medical condition; a limited set of 271 medical conditions (defined in the Diagnosis Treatment Pairs); and 26 chronic conditions (defined in the Chronic Disease List).
Due to the fact that medical aids are required to provide these PMB without underwriting the risk, they have put other measures in place to be able to fund these PMB claims. Some of these measures will be discussed in this article while the remaining measures will be discussed in the following article.
Measure 1: Waiting periods
Waiting periods are imposed on new members where they have pre-existing medical conditions and this period can be different from scheme to scheme, but is usually between three and twelve months. During the waiting period the member can’t apply for any medical costs related to the pre-existing period, but after the waiting period they should be fully covered for such conditions. There is also a three-month waiting period on PMB if the new member was not enrolled with another scheme 90 days or longer before applying to become a member of the new scheme. Waiting periods are imposed to ensure people don’t join medical aids only during a period during which they know they will have expensive procedures ensuring fairness to all members of the scheme.
Measure 2: Network doctors
Medical aids can have agreements in place with specific healthcare providers offering the scheme a more competitive rate in exchange for patience being channelled to their offices. Medical schemes are therefore allowed to limit the claim paid should a member not make use of a network health provider.
Measure 3: Medical scheme rates
Medical expenses in South Africa are not regulated and therefore doctors, specialists and hospitals can charge what they want, provided the fees are deemed to offer “fair value” to the patient. The Department of Health has, however, published a list of recommended tariffs pertaining to specific treatments and procedures conducted in hospitals. This price guideline, known as the Reference Price List (RPL), is used as a framework when medical aids determine their medical scheme rate (MSR). MSR are usually 2% to 5% higher than the RPL guidelines but will differ from scheme to scheme.
Various plans of medical aids will then state whether they will cover procedures and medical costs up to 100%, 200% or 300% of the MSR. Specialists can, and do often, charge up to five times the scheme rate, and there is no legislation stopping them from doing so.
It is therefore important that you understand how much the doctors and specialist will charge for a procedure and compare it with your medical aid plan to ensure you are not under the impression that you are covered for certain procedures that you can not claim for in full from your medical aid.
With health care costs increasing drastically each year it is important to have some sort of medical aid plan in place, even if it feels like you are not reaping the benefits of it due to the above-mentioned measures that medical aids have in place. The benefits will however be eminent when you do have a serious and costly claim that is part of the PMB, provided that you do your homework by going to a specialist that is on the scheme’s network.