As the cost of being a member of a medical aid scheme increases, Justmoney.co.za says that it is time to ‘shop-around' to compare premiums and possibly find a more cost effective scheme. In 2008, the cost of being a member of schemes like Discovery Health and Liberty Health will jump by around 10%.
The reasons for these increases have been put down to rising inflation, higher fees set by consultants and medical specialists, and an increase in claims which meant that schemes had to dip into their reserves - which are legally required to be at least 25% of annual member contributions - so schemes now have to build up their reserves.
According to Discovery Health CEO Neville Koopowitz, speaking to Moneyweb, the generally inflationary environment has meant higher contribution increases. He said: "The underlying cause of the increases has been the higher CPIX. CPIX is the base figure you plug in to these calculations, and as you know, it has broken through 6% recently, when it used to be between 4% and 5%. So that puts you in a difficult starting position. Typically, internationally medical inflation is 2% to 3% higher than CPI."
The Medical Schemes Council, whose job it is to approve or reject changes to the premiums set or benefits offered by medical schemes, has approved 113 options (72% of those it received), but has rejected 49 options (26% of the total) because they were found wanting.
According to Sake Rapport, some of Momentum Health and Oxygen's options were rejected owing to the higher premiums expected of members. Fedhealth, on the other hand, failed as a result of a higher premium and reduced benefits, and all Medicover's options were rejected for the same reason.
Interim results of a poll hosted by Justmoney.co.za found that more than half of respondents (53%) had never shopped around for cheaper medical aid, whilst a staggering 29% say they can no longer afford to pay to be a member of a scheme.
If you think it is about time you compared the cost of your current medical health scheme with its competitors, or simply want to review your current provider to see if you can get more cost-effective cover, check out Justmoney.co.za's new medical aid section.
And vote in the Justmoney.co.za poll to tell us how often you shop-around for a better deal.