HOSPITAL CASH PLANS
Hospital cash plans are intended to pay a daily amount towards nonmedical expenses that might arise when you are hospitalised, such as childcare or loss of income.
“However, these policies are often used as low-cost cover by people who mistakenly believe that the benefits will cover the costs of hospitalisation, leaving them without adequate medical protection,” Roseanne Murphy Harris says.
“Moreover, many hospital cash plans paid benefits only after policyholders had spent as many as four or five days in hospital, which happens only in rare cases.”
Hospital cash plans have therefore been limited to paying up to R3 000 for each day spent in hospital to a maximum of R20 000 a year. The new regulations further stipulate that benefits should be paid after two days spent in hospital, and must be calculated from the first day on which you are hospitalised. In other words, if you spend only a day in hospital, you will not be covered, but if you are in hospital for longer than that, you will be paid out for all days, including the first day, up to the maximums.