Spike in medical claims likely to see fees increased

MEDICAL scheme members are likely to face higher-than-usual contribution increases next year‚ along with greater restrictions in their choice of healthcare providers‚ according to Insight Actuaries.

Open medical schemes – those with no restrictions on membership – reported an overall operating deficit for 2015 due to higher-than-anticipated claims‚ but they managed to cushion the effect on consumers this year by dipping into their reserves‚ according to a report released last week by Global Credit Ratings (GCR).

However‚ after another year of higher-than-expected claims‚ the schemes were going to have to make changes to ensure their income covered their expenses‚ said Insight Actuaries joint chief executive Christoff Raath.

His analysis is consistent with a warning sounded at the Board of Healthcare Funders conference in July‚ during which South Africa’s two biggest medical schemes – Discovery Health Medical Scheme and the Government Employees Medical Scheme – told delegates that they had experienced an unexpected spike in claims.

“Our impression at Insight is that this is an industry-wide phenomenon driven by higher utilisation rather than higher tariffs‚ and more hospital claims,” Raath said.

“The magnitude of this effect differs from scheme to scheme and although what we see is not catastrophic‚ it is not insignificant.”

Raath said schemes would be trying to strike the balance between introducing higher contribution increases and implementing tighter managedcare initiatives and greater restrictions in choice of healthcare providers.

They would also try to lower administration fees and negotiate hard on tariffs with healthcare providers.

Open medical schemes are due to announce their contribution increases and product changes from late September. — BDLive