New generation medical plans have come full circle. From empowering members to manage their healthcare expenses via savings accounts to standardising basic benefits across all medical schemes.

Standardisation of benefit plans across all schemes is a cornerstone in the establishment of a social healthcare insurance system (SHI).

The central vision of government to ensure affordable and predictable healthcare cover for most working South Africans is in motion with the expansion of prescribed minimum benefits and the changes in tax legislation.

Although the introduction of a Basic Benefits Package (BBP) may reduce member choice significantly, the justification is consumer protection and lower administration costs. Futhermore, the implementation of the risk equalisation fund (REF) will effectively standardise the price of a BBP across the industry.

How will schemes remain competitive?
The question then is: How will schemes compete and innovate in the future? According to Hannes Viljoen of Momentum Health the areas that schemes need to concentrate on to remain competitive in the future are:

§         Providing additional benefits on top of the BBP.

§         Managing their risk profile in the most efficient way.

§         Focusing on quality of service to its members, service providers and intermediaries.

 For consumers it will create a transparent situation with regards to the benefits they will receive from any scheme. But what about those consumers who want additional benefits to what schemes will be able to offer? New doors are now open for insurance companies to provide alternative solutions for members of medical schemes.

Momentum’s pro-active approach to innovative product design has already generated two new solutions. Seen as a vital building block for the future, the Health Saver was launched at the beginning of 2006. In addition to this Momentum also recognised the benefits of linking Save Thru Spend to the Health Saver.

Momentum Health members now have two new ways to enhance their healthcare funding. Firstly they can contribute to the Health Saver as a dedicated means of saving for medical expenses. This is a banking product into which monthly contributions are made. Credit equal to the monthly contribution X 12 is made available at the beginning of the year. Secondly, by directing their monthly lifestyle spend to the Save Thru Spend partners they can add the rebates they receive from Save Thru Spend to their Health Saver account as well. The exceptional value a client can expect when combining these two products is illustrated below:

Total monthly saving of R193.50 X 12months = R2 320 additional funds into the Health Saver for medical expenses!

An added service to members is a seamless claims process. Integration with the medical scheme administrator allows for claims to be processed from the Health Saver automatically where the cost is not covered by the medical scheme.

Timeline
2001: Launch of new generation schemes with MSA component

2004: MSA capped at 25% of total risk contribution

2006: Variable Savings no longer allowed

Published in the March issue of Momentarily

(Issued by Momentum Health, March 2006)

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