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Numbers, cases and costs – COVID-19

02 July 2020 Bonitas Medical Fund

As South Africa passes the 150 000 infection rate for COVID-19, the future rate of infections and costs fluctuate. The World Health Organization (WHO) says current COVID-19 data suggests that 80% of infections are mild or asymptomatic, 15% are severe infections, requiring oxygen and 5% are critical infections, requiring ventilation.

Lee Callakoppen, Principal Officer of Bonitas Medical Fund, provides an overview of the likely direct costs associated with the testing and treatment of COVID-19 for the 2020 financial year. ‘There are close to 160 000 cases of COVID-19 in South Africa at present and the number is growing exponentially. We are following the data closely as the Fund represents over 700 000 lives, which is roughly 8% of South Africa’s total medical aid membership and 1.2% of the national population.

‘We have updated our numbers of detected cases, identified members with co-morbidities, broken down positive cases according to age groups, reconciled recoveries as well as outlined costs from pathology and hospitalisations to-date and projected overall COVID-19 costs,’ says Callakoppen.

‘The expected number of total infections and level of care assumptions, are drawn from international experience data and expectations on ultimate detected infection levels, while keeping a view of the local trajectory, which may not be representative of local incidence rates. Given the large degree of uncertainty, various scenarios are being considered.’

Using other countries’ experience as a proxy and allowing for the fact that not all symptomatic cases are necessarily reported, one could assume the following as a possible ultimate proportion of beneficiaries that are expected to test positive for the virus. The majority of these are expected to be symptomatic.
• Low incidence assumption: 0.5%
• Central incidence assumption: 1.0%
• High incidence assumption: 1.5%

Callakoppen says that for the purposes of claims projections, the central incidence proportion assumption is being used. ‘These costs will be spread over 8 months between March and October 2020 using a Gaussian claims distribution. Our additional costs, due to COVID-19, have been estimated at around R340m. However, these projections are still unpredictable at this stage in the year, due to the uncertainty surrounding the COVID-19 pandemic.

However, occupancy of critical care beds for non-COVID-19 patients reduced in April and May as hospitals and doctors encouraged cancellation, or postponement of elective procedures, or shifted these to an outpatient setting, where feasible, to free up capacity.
There is a high level of uncertainty around the level of care that would be required for the Bonitas population over the course of the pandemic, but the following rates can be assumed.

Of those confirmed to be infected (assuming hospital beds are available):
• 20% are hospitalised
o 5% are treated in ICU (i.e. 25% of hospitalisations)
• 60% are treated at home
• 20% are asymptomatic or do not require treatment

Average length of stay for hospital admissions are assumed at:
• 15 days for ICU
• 8 days for High Care and
• 6 days for general isolation wards.

The current assumption, on the average total cost per day (including provider costs), is based on past experience for pneumonia admissions. This will be adjusted over time as statistically significantly information is being obtained as patients are discharged and their hospital claims processed.

Additional Protective Personal Equipment (PPE) cost estimates have been included in the total assumed hospital costs.
PPE requirements vary in accordance with the acuity and level of care of patients. South Africa’s experience is currently limited due to relatively low patient numbers, assumptions used are therefore based on international experience.

Hospital experience to-date
Using available hospital data up to 22 June, Bonitas have had 395 hospital admissions for COVID-19 positive lives (ICD-10 code “U07.1”). The current status of these 395 admissions is:
• 193 still in hospital (153 in general ward, 13 in High Care and 27 in ICU)
• 165 discharged
• 44 deaths
o 23% of these admissions required ICU level of care
o For the 202 discharged patients/deaths, the average length of hospital stay has been 7.3 days
o Considering all admissions (discharged and currently in hospital), those needing ICU level of care have an average length of hospital stay of 13.8 days, of which an average of 8.8 days is spent in ICU.

The decedents were aged between 30 and 90, with the majority in the, 60-69 age bracket.

Pathology experience to date
Using pathology data up to 22 June, the Bonitas test statistics are as follows:
• 22 402 unique lives have been tested (3.14% of Bonitas population)
o This corresponds to 24 884 tests that were performed
• Of these, 1 711 lives tested positive for COVID-19 (7.64% of those tested). I.e. to date, 0.24% of the total Bonitas population have tested positive for COVID-19
• R16.0m have been paid for COVID-19 pathology tests
o R13.3m of this has been paid from risk benefits
o R2.7m of this has been paid from savings benefits

An approximately 3% increase in chronic medicine claims has been observed from March 2020. This increase in compliance could have a positive impact on the Fund’s downstream costs.

At-risk criteria
Of the 395 Bonitas COVID-19 positive hospital admissions:

• 41% have Hypertension
• 27% are Diabetic
• 23% have Cardiac Disease
• 11% are HIV+ and
• 7% have Asthma

Bonitas At-Risk Population
It is important that medical schemes have a full understanding of the risk faced by their individual populations as a result of this pandemic, both from a clinical care as well as a cost implication perspective. Bonitas has adopted a model to identify beneficiaries who are at-risk of developing complications, should they be infected with COVID-19.

Conclusion
These current figures consider estimated direct claims expenditure as a result of COVID-19 claimants on the Fund. There has been an offsetting short-term reduction in claims for elective procedures and treatment of less serious conditions, as well as reduced uptake of optical and dentistry benefits during the COVID-19 outbreak, particularly during the lockdown period.

However, as a Scheme we anticipate that members will access their benefits and undergo treatment such as elective surgeries, based on the advice of the medical professional during the latter part of the 2020 and in 2021. It is possible that these claims will catch up once the spread of the virus has been brought under control and restrictive measures lifted. The current actuarial projections allow for this in the form of higher seasonality assumptions for the months August to December in particular.

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