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15 June 2011

Medical schemes too expensive

The majority of medical scheme members say their schemes are too expensive while a minority actually read their member guides, according to a survey.

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The majority of medical scheme members say their schemes are too expensive while a minority actually read their member guides, according to a survey.

"Three quarters of respondents felt that their medical schemes were too expensive," according to a statement on the findings of the 2010 OMAC Actuaries & Consultants Healthcare Monitor.

"It seems that members are adopting a 'rather safe than sorry' approach when selecting medical schemes and options, instead of trying to improve their understanding. This would exacerbate the feeling that medical schemes are expensive," said Margaret Hulme, head of health care consulting at OMAC.

However, only 44 % of respondents had read their member guides thoroughly.

The survey of 1002 medical aid members or beneficiaries found that nearly half did not use their broker, member guides or the internet to try and improve their understanding of their medical scheme.

Call centres – worst rated

"Call centres were the worst-rated area of service, which might contribute towards members' lack of understanding."

This led to ignorance of what their medical schemes offered.

"According to the survey, one-third of members said they did not know what they were covered for and that they only find out what they are covered for once they claim.

"A third of members complained that they found the benefit structure confusing."

The introduction of cost-saving initiatives may not get the desired response, such as in the introduction of designated service providers (DSP), where members get benefits if they use the services of only DSPs.

"Members do not like DSPs. This is not because of any problem with the concept itself, but rather owing to the perceived lack of freedom of choice - particularly when it comes to GPs."

Good value for money

She said 84 % of members said their scheme offered good value for money, but they believed that more expensive options with more benefits and without DSPs provided the best value for money.

Hulme said in reality the options with lower benefits and using DSPs probably provided better value.

Members surveyed prefer higher monthly contributions and fewer co-payments to lower monthly contributions and more co-payments.

"This may explain part of the preference for more comprehensive and expensive options."

However, despite dissatisfaction few members change schemes.

"Of the members surveyed, 91 % had not changed scheme or scheme options in the last three years - however, when comparing the price and their benefits of their old versus the new options, it emerged that members favour better value rather than lower cost," Hulme said.

(June 2011)

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