Medical schemes will be able to launch low-cost benefit options from January next year. This week, the Council for Medical Schemes released the requirements these options will have to meet to obtain an exemption from certain parts of the Medical Schemes Act.
These options, which will offer primary health care but not hospital cover, could have a positive impact on the growth of membership of medical schemes. Member contributions are expected to be between R200 and R400 a month.
A circular issued by the council this week says the options will be available to members who earn less than the tax threshold: currently R73 650 for people below the age of 65, R114 800 for those aged 65 to 75 and R128 500 for those over the age of 75.
The options will have to cover certain primary healthcare benefits, including at least five visits to a general practitioner, clinic or nurse, certain screening tests, such as those for cholesterol and HIV, acute and chronic medication according to a list or formulary, basic pathology, radiology, optometry and dentistry, as well as road transport in an emergency.
The schemes won’t be exempt from keeping the required reserves for the low-cost options, but may be able to restrict membership of the options to an employer group.
Schemes will not be able to impose late-joiner penalties or co-payments on these options.
The low-cost options will also enjoy higher limits than those that currently apply to commissions to brokers and advisers for signing up members, enabling brokers to earn up to R25 a month per beneficiary.
Daniel Lehutjo, the acting chief executive officer and registrar of the council, said this week that the regulations under the Insurance Acts that National Treasury plans to introduce to demarcate the business of a health insurance policy from that of a medical scheme will require a low-cost option for people who cannot afford existing medical scheme options.
Over the past few years, hundreds of thousands of so-called “combination health insurance products” have mushroomed. These products typically offer lower earners a short-term insurance policy for private ambulance and hospital care in the event of an accident, together with a primary healthcare plan. (Primary healthcare covers visits to a general practitioner and medicines prescribed and possibly some dentistry and optometry.)
The demarcation regulations will ban insurers from offering primary healthcare plans, because these will be regarded as the business of a medical scheme.
Currently, medical schemes cannot offer primary healthcare plans only because they are obliged to provide the prescribed minimum benefits, which include a high level of hospital cover. Lehutjo also said the council has embarked on a project to quantify the value of managed care. Typically, schemes use managed care protocols to control healthcare costs and, ultimately, your contributions.
These protocols list the medicines and procedures that your scheme is will cover. Often, healthcare providers recommend treatment that is not in line with the scheme’s protocols and if you follow your doctor or another provider’s recommendation, you may end up having to foot all or part of the bill for your treatment.