Strong year boosts Momentum Health’s rise through the ranks
09 June 2014
Damian McHugh, Momentum Health
Damian McHugh, Head of Marketing and Sales at Momentum Health.
The past financial year has seen Momentum Health strongly outperform its industry. Not only has the Scheme continued to grow by just over 7%, but it has attracted a favourable membership profile and increased uptake in supporting products. These successes were achieved against an industry background where half of the open scheme market closed down or consolidated over the past decade, a trend expected to persist for several more years.
"With the Risk Equalisation Fund project formally called off, survival is becoming increasingly difficult for schemes with less desirable risk profiles,” says Damian McHugh, Head of Marketing and Sales at Momentum Health. "While other schemes are fighting for survival, we can continue building a stronger scheme that offers its members long-term peace of mind. This is as a result of a 31% solvency rating, sustained growth, a favourable principal member average age of 42.6 years (compared to an industry average of 45) and an AA- credit rating from independent Global Credit Rating company. The Scheme’s service delivery has also ranked among the top three open schemes for several years in a row.”
The increased uptake in complementary product offerings, like Momentum’s HealthSaver, is evidence of market appreciation for a focused approach on modern healthcare provision.
Having surpassed the required solvency level for an open medical scheme in South Africa in 2012, member reserves were once again boosted in the 2013 financial year by a substantial surplus of R143 million. High growth levels typically impact solvency negatively due to the fact that three months of contributions (25% of annual contributions) are required in reserves before the first contribution has actually been received. Despite the high levels of growth experienced, Momentum Health has however grown solvency levels to 31% at the end of 2013. With this injection into reserves, members can rest assured that their interests are very well protected and the Scheme will be sustainable over the long run.
Momentum Health’s product design has remained very stable over the past year, whilst the favourable membership demographics have continued to contribute to its positive claims experience. The Scheme’s claims ratio stabilised at a favourable 80%, and Momentum Health also continued to maintain its non-healthcare expenditure, or the administration costs associated with the operation of the Scheme, at an enviable level. These milestones are significant in terms of the Scheme itself, and when compared to the rest of the industry, they bode extremely well for the Scheme’s future stability.
Providing consistently great service is one of the toughest challenges facing business today. Momentum has shown that service excellence is integral to the brand by winning the PMR Golden Arrow Award for healthcare administration, following on from the Silver Arrow Award it won last year. Over the past five years, the Momentum Health administrator has been placed amongst the top three medical scheme administrators in the PMR survey, demonstrating its consistency in delivering excellent service.
As the 3rd largest open scheme, offering healthcare cover to more than 110 000 families, the Momentum Health medical scheme is strongly focused on backing up its flexible product offering with service that sets it apart from its competitors. Considering the innovative nature of its offering, it can be challenging to maintain market-leading customer satisfaction levels. The administrator has, however, seen intensive training programmes bear fruit, with positive feedback from members on a regular basis confirming that its sustained service enhancement drive is paying off.
Over the last three years, consumer satisfaction levels pegged around the 8.5 mark in the PMR survey.
"Our focus will remain on creating solutions based on member feedback. It is important to ensure that we offer a flexible solution to a variety of members, while making sure that the Scheme not only grows, but grows sustainably, and I believe that we are managing to maintain this healthy balance,” McHugh concludes.