In recent years, there has been far more focus on health issues. Mandatory notices on cigarette cartons warn of the dangers of smoking. Organic foods and wearable devices to monitor heart rate and other vital signs are designed to steer us to a healthier lifestyle. However, quinoa, cycling, jogging and working out at the gym may promote good health, but they cannot guarantee it. However, given the high cost of private healthcare, most South Africans require some form of medical insurance. A hospital plan is invariably the most affordable option. However, you need to understand how this option works before rushing to sign on the dotted line.
Significant Difference between a Hospital Plan and Cash Plan
The idea of providing financial support for in-patients is not a new one. Before the medical aid schemes of today were introduced, the insurance industry offered a cover option with a misleadingly similar name. Furthermore, the nation’s short- and long-term insurers continue to provide this type of policy today. The difference between the two types of cover lies in a single short but significant word. Contrary to popular belief, the hospital “cash” plan is not designed to cover the cost of accommodation and treatment during periods of hospitalisation. Instead, the policyholder can expect to receive a cash sum for each day spent as an in-patient. The amount paid will be determined by the monthly premium payments and is only intended to cover lost income and incidental expenses. Relying on a cash plan could still leave you with a massive bill to settle for the healthcare you received.
Fortunately, South Africa’s medical aid schemes offer their members a very different product. Initially, the hospital plan was intended for young, single individuals with good general health but a limited income. Should the member have a severe accident or illness requiring hospitalisation and surgery, all or most of the private healthcare expenses would be settled by the scheme. At all other times, any minor bills for GP visits and prescription medicines would need to be paid by the member.
Since the launch of this option, healthcare costs have soared, and the country has suffered a series of financial setbacks, leaving many unable to afford comprehensive cover. Consequently, the hospital plan is now their only option. The heightened demand for more affordable cover has prompted many of the country’s medical schemes to seek ways to extend the benefits of this type of product without impacting its premiums. As a result, more South Africans are now discovering that even limited cover can be sufficient to meet their healthcare needs and even those of their dependents. So, how can you decide whether this option is right for you and your family?
Benefits to Expect from this Cover Option
While choosing a hospital plan you can afford is important, your final decision should be based on its benefits. The Council for Medical Schemes (CMS) introduced legislation that has made it mandatory to include cover for 26 named chronic conditions in all medical aid products. So, for example, if you or someone in your family has asthma, diabetes, epilepsy or hypertension, cover for these is included. However, you may be required to obtain medication from a designated provider to avoid co-payments. You can find which other chronic illnesses are covered on the CMS website.
Although the primary purpose of a hospital plan is to offset the costs incurred as an in-patient, some schemes go the extra mile. They include selected out-of-hospital cover, such as dental check-ups. That alone could represent a substantial saving for a couple with small children. Some plans will also have a day-to-day savings plan. This option could help you meet most, if not all, of the out-of-hospital expenses you might incur during the membership year.
However, although these products provide cover for injuries sustained in an accident and medical emergencies, the hospital plan benefits will only kick in if you are admitted. Payment for treatments for minor injuries undertaken in the emergency room which don’t justify admission will generally be your responsibility.
KeyHealth has a century of experience and is one of the nation’s ten largest medical aid schemes. Our product portfolio for 2022 offers prospective members six options, including two in the category under discussion. Essence offers members comprehensive medical benefits cover, including unlimited hospitalisation and some valuable free services. For families, the better choice might be Origin, which combines the features of the Essence hospital plan with day-to-day benefits funded from an insured risk pool.
