2023 is right around the corner.
Transitioning into the new year means that you are likely hearing about medical scheme increases and product changes from your medical aid. But what does this mean for you and your budget?
How will the increasing cost of private healthcare affect you in 2023?
Private healthcare vs public healthcare in South Africa
Public healthcare in South Africa is a sensitive topic, as health services are often neglected in budget and staffing. One of the public sector’s biggest problems is that the health needs of the people far exceed their capacity.
The private sector, however, is known as one of the best healthcare sectors in the world.
Many South Africans see health insurance as an investment in their health and to ensure they and their families receive the best care possible.
Unfortunately, this comes with high financial expectations.
Private healthcare since Covid-19
Covid-19 unearthed a myriad of existing challenges in the public healthcare sector and created some new ones in the private healthcare sector.
As with many other industries, the most significant challenge private healthcare experienced was the sudden, extreme financial pressure.
Financial stressors in 2020 included:
- Cancellation of elective surgeries
- Reduction in acute care and emergency cases
- General economic stunting and inflation
The state of the economy and the abovementioned issues eventually forced doctors to increase their rates and hospitals to increase admission costs.
Health insurance increases in 2023
Now that hospital admissions have returned to pre-covid levels, the number of claims by members has significantly increased in 2022. The increase in claims and the need for private healthcare to recover losses from 2020 will likely lead to steep medical insurance rate increases in 2023.
Therefore, you are likely to pay more for the same medical benefits while paying more out-of-pocket healthcare expenses.
Members can expect an annual increase in line with medical inflation in 2023, but these increases will differ from provider to provider.
This is why it is essential to choose your provider carefully.
Choosing health insurance in South Africa
How do you ensure you make the right choice with the best possible benefits, especially considering the current economic climate?
How medical aids select their scheme rates
Before making a choice, ensure you understand how medical aids select their health insurance rates.
Their rates are typically based on two things:
- The level at which other healthcare providers are going to increase their fees
- The rate at which the scheme can afford to increase benefits by
How scheme rates differ from provider to provider
Medical schemes aim to be as competitive as possible when it comes to their rates. However, each medical aid has various factors that contribute to its costs. These include:
- Average member age
- Benefits included
- Plan structure
- Member demographic and social profile
- Economic factors
Many health insurance companies in South Africa chose to defer some of the inflation to protect their members over the last two years. Unfortunately, this is a temporary solution and will eventually affect members – likely in 2023 and 2024.
But how can I save costs?
As you can see, medical schemes are fighting their own battle to keep costs at bay. Unfortunately, this will soon catch up with members, who will be paying more out of their pockets.
The best way to save and protect your finances? Gap cover.
Choosing a comprehensive health insurance plan in South Africa is financially impossible for some. Comprehensive plans may be the right option for some, but if you’re looking for a way to save money on healthcare, we recommend the following.
Opt for a basic medical aid plan and choose a premium gap cover product to complement it. This way, you’ll have the benefit of medical aid, and most of the costs that are not covered by your primary plan will be considered a shortfall.
Gap cover is specifically designed to help pay for any fees that your medical aid does not cover. Doing this can save you thousands a year – it makes financial sense.
As discussed previously in the article, the public healthcare system in South Africa is struggling to keep up with the demand.
It’s generally underfunded and overstaffed, which leads to waiting in endless lines and being sent from place to place to get the medical attention you need.
Even though the public sector is much more affordable and necessary, you should look after your and your family’s health in the best way possible.
Choosing a gap cover provider
When choosing a gap cover provider, it is essential to do thorough research and review the most up-to-date statistics to make an informed decision.
Consider the following factors before choosing your gap cover provider:
- FSCA Compliance – Check whether they are registered with the Financial Sector Conduct Authority (FSCA).
- Global Credit Rating (GCR) – A GCR is a gauging reference for a gap cover provider’s credibility. Having a gap cover provider with a high global credit rating will give you peace of mind in knowing that you are securely covered during your time of need.
- Members reviews – What do their current members say about their service? You can read over 200 reviews from Total Risk Administrators policyholders on HelloPeter.
If you are concerned about the financial health of your gap cover provider, know that TRA strives to provide exceptional service and can pay claims quickly.
If you are trying to find the right gap cover for you, speak to a broker to alleviate your concerns and help secure the future of your health insurance.
Note: All material on this website is provided for your information only and may not be construed as medical advice or instruction. No action or inaction should be taken based solely on the contents of this information; instead, readers should consult appropriate health professionals on any matter relating to their health and well-being. The information and opinions expressed here are believed to be accurate, based on the best judgement available to the authors, and readers who fail to consult with appropriate health authorities assume the risk of any injuries. Errors and Omissions Excepted. Terms and Conditions Apply.