Providing Affordable Medical Aid to Make Private Healthcare More Accessible
The need for more affordable medical aid has become ever more important as the cost of healthcare continues to rise and the state funded facilities become increasingly less able to satisfy more than the most basic needs of South Africa’s expanding population. It is perhaps ironic that the new technologies now serving to provide faster and more reliable diagnoses and treatments for conditions once thought to be incurable, are also limiting the capacity of both the state and its citizens to pay for them.
The need for some form of insurance to defray healthcare expenses is certainly not a new one. In fact, private treatments were already becoming more affordable, thanks to medical aid funds, soon after the launch of our National Health Service. At this time, the cost of treatment was supported adequately from the state’s coffers, despite the fact that patients paid very little or nothing for the attention received. In practice, it was the long waiting lists caused by the high demand that spurred many, instead, to seek their care from the emerging private healthcare sector.
At first, this was an alternative that was feasible only for those with an adequate income – a fact that piqued the interest of the insurance companies. Initially, they sought to make private medicine more generally affordable and underwrote medical aid insurance policies in order to do so. With the later emergence of a new type of insurer dedicated exclusively to the provision of this specialised cover for private healthcare expenses, a new industry was born.
In South Africa, today there are around one hundred of these specialised funds in operation. Of these, just over seventy percent are closed schemes, providing cover to specific groups, such as the staff of a particular company or the members of a particular profession or occupation. The closed scheme offers lower premiums in exchange for a captive membership agreement.
In order to provide cover that is more affordable, open medical aid schemes have adopted other measures with which to control premiums. One such measure has been to develop alternative products with differing benefits designed to meet the anticipated needs and budgets of most. One example has been the hospital plan aimed primarily at the young and healthy, whose main concern is an accident or emergency that may require costly hospitalisation. Other schemes have simply reduced or excluded certain benefits in order to fix their premiums.
The more innovative and member-orientated funds, however, have sought ways to retain their benefits while looking at other ways to reduce costs and stabilise their premiums. One very effective route to more affordable medical aid premiums has been for funds to establish a network of preferred service providers, including clinics, specialists, pharmacies and pathology laboratories. By mandating their members’ use of these network providers, the schemes benefit from lower costs and correspondingly smaller claims, which allow them to charge smaller premiums.
In addition to developing an extensive network of preferred service providers, we at KeyHealth have taken the additional step of focussing solely on members’ needs and excluding costly, irrelevant add-ons. In doing so, we offer simple products that make choices easier for all, but which also provide some unique, invaluable and totally free benefits; positioning us as an exceptionally affordable medical aid.
