Momentum Health posts Strong Results for 2010 Financial Year

Momentum Health has today released strong financial results for the 2010 Financial Year.

Highlights include:

* Continued growth in membership for the 6th successive year in a row
    Up more than 75% (from 2005)
* Significant improvement in solvency
    Up 4% (from 2009)
* Positive operating surplus

Commenting on the strong showing, Damian McHugh, Head of Marketing & Sales Momentum Health said: “Members have continued to place their trust in us, believing that Momentum Health is a medical aid that offers solid value and reliable delivery. We are proud of the work that we have put into these improved results and the recognition of a strengthened Momentum Health brand.”

Through the merger of Momentum and Metropolitan, the combined medical aid administrators now represent the largest healthcare administrator in South Africa. Its 32% market share brings about benefits of scale for Momentum Health such as greater cost efficiencies and increased negotiating power with service providers.

McHugh adds: “Through the greater efficiencies and cost savings that this transaction has brought about, it is now possible for us to simultaneously put member contributions to effective use and protect benefits. Momentum Health, as an open medical aid, will continue to service niche clientele and offer the personal approach to which its members have become accustomed. We have approached the merger from a strategic strength that goes beyond member numbers.”

“I believe Momentum Health’s successes can be attributed to our innovative product offering that provides value and customised healthcare solutions for individual needs, and the fact that Momentum incentivises members to take care of their health and be active. Momentum’s HealthReturns programme is unique in that it offers tangible returns, which, during this tough economic cycle can be helpful,’ says McHugh. A family with member and spouse can earn up to R3,600 per year back in their pockets, or as much as R,7,200 if they also belong to Multiply (Momentum’s wellness programme) and maintain their activity at the required levels. Motivating and incentivising a healthier membership base benefits everyone.

The appeal of its product offering has enabled this medical aid to continue growing, despite an adverse economic climate. Momentum Health boasts an average age of 43.3 (as at December 2010), which is well below the industry average. The age profile is the clearest sign of what future claims will look like, adding to Momentum’s strong solvency outlook. “Having on average a younger member profile makes for a stronger, more secure scheme over the long term that can pay for the claims of all members on our medical aid,” says McHugh.

Significantly, Momentum Health’s solvency ratio has increased from 15.8% in 2009 to 19.5% in 2010 – an increase of almost 4 percentage points. Often a medical aid’s solvency ratio reduces when their membership increases, however Momentum Health has also seen an increase in its membership to approximately 90 000 principal members.

In addition, Momentum Health has declared an operating surplus for the 2010 financial year. This strong financial position further underpins the sustainability of this medical aid. Many members in South Africa are on a scheme that made operating deficits in 2010 and that is a concern. It is important to note that the improved operating surplus did not come at the expense of quality of care or benefits. A recent member survey revealed 90% of members are satisfied with Momentum Health’s processes such as pre-authorisation. Momentum Health is also the only open medical aid that provides members with a “Patient Advocate” service at the point of pre-authorisation. This means members can get an upfront indication of potential out-of-pocket expenses.

The Global Credit Rating Company, an independent risk rating group, has reaffirmed the medical aid’s strong position by again awarding Momentum Health an A+ credit rating for the seventh consecutive year.

In a volatile environment that is characterised by a continuously declining number of open medical schemes, Momentum Health has focused not only on increasing the sustainability of the medical aid, but also on offering innovative products and services, such as the mobisite launched earlier this year. Regarding this innovation, McHugh notes: “Whether you need to find a healthcare provider that is closest to you, track your claims, send proof of your membership to your service provider, or simply want to find out more about what Momentum’s medical aid has to offer, you can now access all of this and more straight from your cellphone”.

McHugh concludes, “All these achievements flow from Momentum Health’s commitment to its long term strategy and an unwavering focus on the welfare of its members. These results show that we deliver on our promises and that should further strengthen support for Momentum, going forward.”