Choosing a medical scheme option that’s right for you

November or December is typically when you decide whether to stay on your medical scheme option or move to another one. Laura du Preez reports on what you should consider when making up your mind.

At this time of the year, you are likely to receive a letter from your medical scheme informing you of contribution increases and changes to its benefit options for next year.

So what should you consider when you review your medical scheme cover?

Daniel Lehutjo, the acting chief executive officer and registrar of the Council for Medical Schemes, advises people to review their healthcare claims and current state of health. Make a list of your claims over the past three years and take into account any future needs of which you are aware.

“Price is not the only determining factor. We advise people to look at their current and future healthcare needs,” Lehutjo says.

Generally, the more freedom it gives you to choose a healthcare provider, treatment or medication, the more an option will cost.

There is a difference between acute conditions, such as bronchitis, which you contract and recover from and chronic conditions, such as high blood pressure or high cholesterol, which require ongoing treatment. Some common chronic conditions are prescribed minimum benefits (PMBs), which means the scheme must pay in full for the medication, as well as for tests and consultations related to the condition.

First, ensure that your hospital cover and chronic cover suits your needs, and then weigh up the cost of buying day-to-day cover for visits to a general practitioner (GP) for acute conditions, medicines for acute conditions, dentistry and optometry against saving enough to self-fund these expenses.

If you don’t have the discipline to save, choose an option with either good day-to-day cover or a medical savings account, which will force you to save for these costs.

Here are some of the things you should consider when weighing up one option against another:

Most options limit the medical care they will fund. In this regard, there is a difference between traditional benefit options and new-generation options, Elsabe Conradie, the head of stakeholder relations at the Council for Medical Schemes, says.

Traditional benefit options do not have a medical savings account and fund all claims from the overall annual benefit, whereas modern benefit options have a medical savings account that is used to fund certain services, such as GP visits and acute medicines, she says.

The overall annual benefit may have various sub- divisions with their own benefit limits. For example, an option has an annual limit of R500 000 per family. This limit includes benefits or services for “major” events, such as MRI and CT scans, which have a sub-limit of R5 000 per family, Conradie says. If a member has scans that cost more than R5 000 (for either the family or one dependant), the medical scheme will pay up to R5 000 only.

Most medical schemes have sublimits on prostheses, such as artificial joints and other devices, and you may have to meet certain criteria to qualify for the benefit.

Cancer (oncology) benefits are also usually stipulated as a specific amount – for example, R250 000 per family a year, Conradie says.

It is important to take note of the overall limit, the sub-limits for certain services and the rules that apply to the sub-limits. But remember that the limits and sub-limits may not apply to the payment of accounts for PMBs, Conradie says.

PMB accounts may be paid from the annual benefit if this is in the scheme’s. But if the PMB accounts deplete the annual benefit, your scheme must continue to pay for PMB treatment.

Regulation eight under the Medical Schemes Act specifies that your scheme may appoint one or more designated service providers (DSPs) for the diagnosis, treatment and care of PMB conditions.

If you choose not to use the DSP, the scheme may charge a co-payment, Conradie says. The co-payment must be specified in the scheme’s rules. It can be a percentage of the cost, the difference between the scheme’s rate and the actual cost, or a fixed amount.

Not using a DSP may explain why your claims on your current option are not being paid, or are not being paid in full. You also need to know whether any DSPs have been appointed for an option you may be considering joining.

If you have a PMB condition and the DSP is not within a reasonable distance of where you live, or is not available within a reasonable period of time, or you require immediate treatment, your scheme may not impose a co-payment.

A scheme may have a list of medicines, known as a formulary, for which it will pay in full. If you voluntarily use a medicine that is not on the list, the medicine may not be covered, or the scheme may impose a co-payment, even if it is a chronic condition that is a PMB.

The co-payment must be specified in the scheme’s rules. Again, it can be a percentage of the cost, the difference between the scheme’s rate and the actual cost, or a fixed amount, Conradie says.

If you have a PMB chronic condition and none of the medicines on the formulary is effective, or they have harmful side-effects, the regulations under the Medical Schemes Act oblige your scheme to fund the prescribed medicine without imposing a co-payment, Conradie says.

An option may have a limit on what it pays doctors who treat you in hospital. For example, your scheme may reimburse doctors at 200 percent of the scheme’s rate. However, there are no limits on what doctors may charge, so your doctor may charge 400 percent of the scheme’s rate.

Unless your scheme has appointed a DSP, it may be obliged to pay whatever rate the doctor charges if your condition is a PMB.

Schemes may contract with healthcare providers in a preferred provider network to charge at a particular rate for non-PMB conditions, Conradie says. By using one of these providers, you can avoid cases where your medical scheme will impose a co-payment.

If your scheme has a preferred provider for a non-PMB condition and you do not use that provider, your scheme may limit what it will pay towards the account, she says.

Some cheaper options offer benefits through a network of healthcare providers only. The rules of these options usually provide for a limited number of consultations or other benefits obtained outside of the network. But in these options the network will also be the DSP, and the regulations about using non-DSPs, as outlined above, will apply.

Schemes are entitled to use managed-care protocols to ensure that your treatment is cost-effective and affordable, but they must be “evidencebased”, which means they must have been confirmed by scientific studies, Conradie says.

Your doctor may prescribe treatment for a PMB condition, such as cancer, that is not evidence-based, or is supported by scientific studies but is not cost-effective for the scheme. In that case, the treatment will not be covered by the PMBs.

The PMBs are the minimum treatment that medical schemes must fund, and the regulations state that this minimum is the treatment available in the state healthcare sector, Conradie says. If the treatment prescribed by your doctor is not available in the state sector, the scheme cannot be compelled to fund this treatment in full. In such a case, your scheme may fund the treatment to the limit of the treatment in the state sector. Schemes use these to prevent members and their doctors from using expensive services when they are not absolutely necessary.

The Medical Schemes Act states that only 25 percent of the member’s total contribution may fund a medical savings account that is used to pay for day-to-day medical needs that are not PMBs.

Work out the amount you contribute and compare it with your day-to-day, non-PMB medical needs. If it is not enough, you need to consider setting aside your own savings for these needs, or moving to a higher option. When you consider what to do, evaluate the additional cost of a more expensive option against the additional benefits and whether you need them.

Check whether an option has above- threshold benefits, which cover your day-to-day costs once you have depleted your medical savings account, Conradie says. Typically, these benefits are offered on more expensive options.

The expenditure you must incur before the insured benefits apply is typically higher than your savings account balance, so you will have to pay your own claims while you are in this “self-payment gap”.

PMBs may never be funded from a medical savings account. Even if you have depleted your medical savings account and your annual benefits, the scheme must still pay your PMB accounts, although protocols, formularies and DSPs may apply, Conradie says.