Mahatma Gandhi once said, “It is health that is real wealth and not pieces of gold and silver”. However, staying healthy can be a very expensive affair. Medical aid gives you access to a wide range of healthcare benefits in exchange for a monthly premium. As each of us has different health needs and budgets, there are a variety of medical aid plans to meet individual needs. Gap Cover is not an additional medical aid. Rather, it is an insurance policy to cover the shortfall (Gap) that your medical aid does not cover in some cases.
Medical Aid and Gap Cover
The demarcation between short-term health insurance and medical schemes goes back to 2000, after the enactment of the Medical Schemes Act no. 131 of 1998. To educate consumers on the difference between medical aid scheme cover (which is governed by the Medical Schemes Act) and other types of health insurance (which are governed by the two insurance Acts), the final “Demarcation Regulations (DR)” was signed into law on 23 December 2016.
Gap Cover FAQ:
Do the new regulations penalise Gap Cover?
No. Gap cover is a short-term health insurance product which the new regulations confirmed is still necessary. It will remain, notwithstanding a few changes.
What are the main changes to Gap Cover?
• The annual benefit level has been capped at R150 000 per insured person per annum (This is subject to annual review/amendments)
• No enrolment discrimination based on age.
• Separate pricing on a “per group” basis, allowing for open enrolment and evading anti-selective practices in the market.
When did these new regulations come into effect?
These Demarcation Regulations (DR) were signed into law on 23 December 2016. All new policies had to comply from 1 April 2017. Existing policies have until 1 January 2018 to comply.
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