Health in­sur­ance reg­u­la­tions will be re­leased this month

Weekend Argus (Saturday Edition) - - PERSONALFINANCE -

Much-awaited reg­u­la­tions un­der the In­sur­ance Acts that de­mar­cate health in­sur­ance from med­i­cal schemes will be re­leased by the end of Novem­ber, Reshma She­o­raj, a di­rec­tor of in­sur­ance in the fi­nan­cial sec­tor pol­icy unit at Na­tional Trea­sury, says.

The aim of the reg­u­la­tions is to en­sure that in­sur­ance prod­ucts do not un­der­mine the sub­sidi­s­a­tion of the old and sick by young and healthy in med­i­cal schemes.

De­spite the im­mi­nent reg­u­la­tions, some providers of gap cover health in­sur­ance, which pays the dif­fer­ence be­tween what spe­cial­ists charge for in-hos­pi­tal pro­ce­dures and what your med­i­cal scheme pays, have al­ready an­nounced their in­creases for next year.

Mike Set­tas, a di­rec­tor of gap-cover provider Xelus, says Xelus’s av­er­age pre­mium in­crease of 11.8 per­cent does not take into ac­count the pos­si­ble im­pact of the reg­u­la­tions, be­cause Xelus be­lieves the reg­u­la­tions will af­fect only new prod­ucts, while ex­ist­ing poli­cies will be given a year in which to com­ply.

Trea­sury has re­leased two drafts of the reg­u­la­tions over the past three-and-a-half years.

The first draft pro­posed a ban on gap cover and strict lim­its on the amounts that can be paid as ben­e­fits from hos­pi­tal cash plans, which pay a set amount for each day you spend in hos­pi­tal. The sec­ond draft pro­posed that in­sur­ers be al­lowed to of­fer gap cover, but with a ben­e­fit cap of R50 000. It also pro­posed that com­bi­na­tion plans, which pro­vide a hos­pi­tal cash plan and pri­mary health­care cover, be banned.

Both drafts elicited much com­ment from stake­hold­ers, in­clud­ing threats to chal­lenge what was al­legedly a de­nial of the con­sti­tu­tional right to ac­cess health­care ser­vices.

Trea­sury, in con­junc­tion with the Depart­ment of Health, has re­worked the pro­pos­als.

In the mean­time, the Coun­cil for Med­i­cal Schemes formulated a frame­work for a low-cost ben­e­fit op­tion that would of­fer pri­mary health­care only, but this pro­posal was with­drawn fol­low­ing crit­i­cism from doc­tors. – Laura du Preez

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