By Reo Botes, Managing Executive of Essential Employee Benefits
Having some form of medical cover is essential for affordable access to quality private healthcare in South Africa, but making the right choice of cover for your needs and budget can be a daunting task. There is so much jargon surrounding the industry, from waiting periods, penalties, exclusions, and pre-existing conditions to formulary, preferred providers, and tariff codes, to name a few. Understanding these terms is key to selecting the most appropriate option for you and your family, so it is important not to let the complexity put you off. Working with an advisor can help you decipher the technicalities and find the best fit to protect your health and financial wellbeing.
Understanding the fundamentals
Choosing the right cover starts with understanding the fundamentals, including the plan coverage and the price. Medical insurance is not the same as medical aid; medical insurance is a short-term insurance policy, while medical aid is governed by the Council for Medical Schemes, and the way they cover treatment will differ. The premiums also differ as a result, with medical insurance offering a more affordable option with less comprehensive cover. It is therefore essential to know what you are paying every month and what this payment gets you in terms of healthcare. Then you can decide whether what you are paying for aligns with your needs and your affordability factors.
Once you have selected a cover option, you need to understand certain terms. Waiting periods refer to the length of time between taking out a policy and when certain conditions will be covered; for example, a new policy might have a waiting period of three months before you will be covered for day-to-day medical expenses, while emergencies will be covered immediately. This also applies to pre-existing conditions, which are illnesses or factors affecting your health that you already knew about at the time of taking out a policy. For example, if you have an already-diagnosed back problem, treatment relating to this may not be covered for the first year of your policy. Exclusions are conditions and treatments that are not covered by your insurance.
There are also terms like preferred provider or Designated Service Provider (DSP) that you need to understand; these refer to the doctors, hospitals, and medical providers that form part of your insurance network, with whom your insurance has an agreement to cover your treatment in full. Chronic conditions are long-term health conditions that are covered according to certain well-defined treatment plans and use medications on a formulary, or a defined list of medicines used to treat these conditions. Tariff codes are international standardised numbers that are used to indicate the type of treatment or service provided and the associated cost.
Do your research
While the list of terms and terminology can seem overwhelming, a bit of research can help you understand what they mean in general. However, understanding how they apply to you and your unique circumstances is more challenging. This is why it is important to work with an advisor or broker and to share information in good faith to help them help you. These knowledgeable and experienced individuals understand the industry and can help you make the most informed decisions – without any additional cost to you, as brokers do not charge consumers for their services.
Additional questions to ask include things like: are there network providers in my area, and are there copayments involved? Do the doctors in my network dispense medicine as well, so I can save on these costs at the pharmacy? How are providers contracted, and how are they covered? Will I need to pay the provider and claim back, or does my insurance pay them directly? If you travel a lot, does your insurance have network providers in the areas you travel to? This information is easily available, and your broker or advisor can help. Asking questions and educating yourself while being open and honest with your broker or advisor is vital.
Choosing the right medical insurance is a personal journey, and you need to understand your risks and how they align with your cover. If there is anything that is unclear about medical insurance policies and cover, it is essential to ask questions. Don’t be intimidated by jargon and acronyms; this is what your broker or advisor is there for – to share their knowledge and help you make educated and informed decisions. They are legally required to give you the best advice they can and will use the information you give them to align your affordability and requirements with the benefits of your chosen cover.
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