As the cost of private healthcare has continued to rise and it has become increasingly difficult for the nation’s medical aid schemes to keep premium prices as low as they would like, it has become necessary for them to create newer and cheaper products. Of these, probably the most popular have been the various hospital plan options now available in South Africa.
While launched relatively recently in terms of the lengthy history of this industry, the concept is not a new one. Simply put, it is a form of medical insurance that applies only during those times when the insured is hospitalised and, as it happens, was a form of cover that was first introduced by insurance companies back in the ‘60s, albeit in a somewhat curtailed form when compared with the offerings of medical aid schemes today. While still offered by insurance companies today, it is important to differentiate these products from the hospital plan options offered by dedicated medical schemes in South Africa
More accurately described as a hospital cash plan, the product of the insurance companies is not intended to cover the actual cost of the treatment and accommodation but, instead, to provide hospitalised policyholders with a fixed daily sum with which to offset the various incidental expenses that tend to arise when one is in hospital. On this basis, the patient is actually left to settle the bulk of his or her healthcare expenses by whatever means may be available. Clearly, therefore, this is not really one of the more viable hospital plan options available in South Africa. Typically, a portion of those who already have comprehensive medical aid cover will choose to purchase these cash plans as a form of gap insurance to cover any co-payments to their scheme that might prove necessary.
A fundamentally sound idea, nevertheless, this type of product was originally developed to meet the needs of a specific market segment. In practice, it was aimed at the young, single individual in good general health, but with a limited income. While this leaves members to meet the cost of the occasional GP appointment and prescription medication from their own pocket, the hospital plan options from medical aid schemes in South Africa are designed to provide them with protection against the unexpected. Not only could a car crash be life-threatening, but the cost of treating the resulting injuries could leave one in debt for many years.
Unfortunately, these products are often perceived as a more affordable alternative to the costlier cover provided by more comprehensive medical aid products by those who do not actually fall within the intended market segment. In this case, to settle for certain of the hospital plan options in South Africa could prove to be a risky decision, especially for someone who may be married and perhaps has one or two children whose health could become a concern at any time.
In some cases, these plans can be fairly limited in terms of their cover and might even exclude the cost of any medication dispensed at the time of a member’s discharge. For a more comprehensive offering that takes the benefits of typical hospital plan options in South Africa to a new level, chat with KeyHealth about its affordable Essence option.
