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COVID-19 highlights need for good healthcare broker advice

01 September 2020 Kerry Vermeulen, Senior Consulting Manager at Alexander Forbes Health
Kerry Vermeulen, Senior Consulting Manager at Alexander Forbes Health

Kerry Vermeulen, Senior Consulting Manager at Alexander Forbes Health

Now more than ever before, healthcare brokers have an important role to play in assisting consumers of private healthcare with their choices as Covid-19 has meant making some critical medical and financial decisions.

Healthcare brokers play a critical role in the distribution of medical scheme products and offer valuable advice to consumers of private healthcare in South Africa. Many people have had either their health, their livelihoods or both affected by Covid-19, retrenchments and salary cuts mean reconsidering expenses. Here, a broker is invaluable in assisting with possible plan downgrades while ensuring an individual is still adequately protected.

The Medical Schemes Act 131 of 1998 defines broker services as ‘the provisions of service or advice in respect of the introduction or admission of members to a medical scheme; or the ongoing provisions of service or advice in respect of access to, or benefits or services offered by, a medical scheme’.

In terms of the Financial Advisory and Intermediary Services Act, all healthcare brokers are required to be ‘Fit and Proper’. This means they need to act with honesty and integrity, be competent and meet qualification requirements, experience requirements, continuous professional development as well as operational ability requirements.

When considering what medical scheme to join, a member should not base their decision solely on the premium being paid. They should ask their healthcare broker about the sustainability of the medical scheme in question, taking into account membership growth, administration, solvency and past annual average increases. You do not want to make the mistake of joining a ‘cheap’ medical scheme that is not sustainable in the long term, as changing medical aids at a later stage comes with its own associated pitfalls.

Brokers help to guide consumers to more efficient healthcare and assist members of the medical scheme to make informed decisions when seeking the most appropriate healthcare cover for them and their family.

Each family has their own unique needs based on their individual healthcare requirements, family size and affordability. It is therefore crucial that a healthcare broker assists with this overwhelming task. A healthcare broker should help you understand your plan, explain any underwriting terms, conditions and waiting periods, as well as networks and any limitations, such as tariffs and co-payments or deductibles.

The advice process is therefore a critical factor in the role of a healthcare broker. This process involves:
• a comprehensive and professional introduction to the client
• gathering client information
• conducting a financial needs analysis
• preparing a recommendation for the client
Once the client’s membership has been finalised with the medical scheme, your healthcare broker should continue to provide intermediary services such as handling client requests, queries, instructions to add or remove dependants on your policy, complaints and claims.

With the renewal period and your annual opportunity to review your option around the corner, having a good healthcare broker is crucial. Review your medical scheme option and with the advice of your healthcare broker decide whether you are over or underinsured on your healthcare option based on your individual circumstances.

Quick Polls

QUESTION

Financial behaviour experts suggest that today’s risk modelling methodologies ignore your client’s emotional ability / behavioural capacity. What are your thoughts on spicing up risk profiling tools to make allowance for your client’s financial behaviours

ANSWER

[a] Bring it on; my client’s make too many irrational financial decisions
[b] Existing risk profiling tools are adequate
[c] Risk profiling tools should be based on the model / rational client
[d] The perfect risk profiling tool is science fiction
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