We are often asked the question: how do I evaluate my medical scheme and plan, and what must I look out for when comparing different options?
Members can choose which option they want or need:
- Traditional option – The out of hospital day-to-day benefits are paid from the risk portion of the option and not from a savings account
- Hospital plan – no day-to-day cover, only covered for in-hospital procedures if pre-authorisation is granted
- Hospital plan with a savings account – so called new generation options
- Comprehensive plans – combination of new generation and traditional options
- Capitation products – based on your monthly income
Medical scheme options consist of several different components. Nowadays most available options include a savings component as part of the day-to-day benefits. Most of the old traditional options have been phased out, but where they still exist they include many sub-limits. The higher the sub-limits, the more costly the option.
The options’ components include the following:
Risk cover refers to the total coverage within your particular option excluding your medical savings account, where applicable. It therefore includes your in-hospital, certain chronic medication and day-to-day benefits that are not paid out of the savings account.
This cover applies when a member is admitted to hospital. Pre-authorisation must be obtained for all planned and emergency in-hospital procedures. This does not include the emergency room except if you are admitted to hospital directly from the emergency room. Pre-authorization must also be obtained for day clinic procedures. Day clinics are also included in the risk/in-hospital cover.
Chronic medication is medication that you must use for a long-term illness like Diabetes, Asthma, etc. Not all chronic conditions are paid from the risk. In cases where it is paid from risk there is a formulary list of medication and co-payments that are payable if you decide not to use formulary medication. To make use of the chronic benefit, you must first register for it. If you are not registered, your medication will be paid from your savings and/or day-to-day acute medication benefit.
Day-to-day benefits cover all your out-of-hospital and non-chronic medication. These benefits can be paid from your savings account, from risk or from a combination of the two. It depends on the structure of the option that you choose. Years ago these benefits were unlimited, but nowadays there is an overall limit and usually a range of sub-limits for certain benefits such as dentistry and acute medication, to name a few.
The total annual savings account is made available to the member at the beginning of each calendar year, much like an overdraft facility. All out-of-hospital claims are first paid from the savings account. The savings account is funded from the monthly savings component of your contribution. This savings account belongs to you as a member. If the savings account has a positive balance, that balance belongs to you. However, should you decided to cancel your membership during the year and if your claims have exceeded your contributions paid to the scheme, you will owe the scheme that negative balance.
Almost all medical schemes have, as part of their total series of options, a so-called capitation option, which they regard as an entry-level option. These options have certain limitations in order to make them as affordable as possible. An example of such a limitation is that you as a member do not have freedom of choice when it comes to a service provider. There is a list of contracted service providers that you must use. Instead of paying a consultation fee, the scheme pays the provider a monthly fee to treat its members on this option. It is important to regularly check that your chosen provider is still on the list of providers as these lists do change. In comparison to the majority of non-capitation options whose premiums are determined by your family size, these options are based on your monthly income.
It is therefore important that when you have the opportunity to change your option at the end of the year, you will consider the above when making your choice for the following year.