KEEP UP TO DATE WITH ALL THE IMPORTANT COVID-19 INFORMATIONCOVID-19 RESOURCE PORTAL
FANews
FANews
RELATED CATEGORIES
Category Healthcare
SUB CATEGORIES General  |  HIV |  Medical Schemes | 

Get what you pay for

01 December 2004 Angelo Coppola

Rate increases, benefit erosion and medical inflation are all interlinked and have to be considered when trying to understand why some medical schemes are talking about premium increases that seem to be fair and reasonable.

"All in all however the increases should be seen for what they are," says Jeremy Yatt, CEO of one of the few truly independent medical schemes left in the country, who announced an average 6.6% premium increase.

Some schemes have announced single digit premium increases, others have launched loyalty programmes and credit cards linked to banking institutions, while others have reduced benefits to ensure that increases are lower than expected.

"Essentially there is a need for the scheme to maintain profitability and ensure that the shareholders and holding companies receive the prerequisite profit margins. This profit demand has been offset by the introduction of more effective regulation, and it is no longer as straightforward for administrators to siphon excessive fees out of schemes.

“The strategy has now changed. Financial service organisations in this industry now mine the rich databases that exist in schemes and link the scheme's benefits to life policies and other offerings.”

Yatt says that members and employers have to ensure that they know exactly where they stand in these schemes, in terms of benefit coverage and that they are not buying something that is simply a mechanism to sell them something else.

“At the moment the member of the scheme comes in a distant third or fourth place on the food chain.

“Members thinking of changing or re-evaluating their medical schemes should do their homework and understand exactly where their contributions are going to,” says Yatt.

Quick Polls

QUESTION

Are you shocked by Sasria’s 2022 rate increases, or is it expected given the sheer scale of the July 2021 rioting plus the ongoing increase in frequency and severity of protest losses?

ANSWER

Yes, I am shocked and so will my clients be shocked
No, it was expected
fanews magazine
FAnews November 2021 Get the latest issue of FAnews

This month's headlines

New proposals to amend PPRs have major impact
The untold truth about intermediary agreements
Rethinking claims
Tik-Tok: The clock is ticking on SA’s R45 billion unclaimed benefits bomb
Medical schemes’ average increases for 2022
Disability claims aggregation
Subscribe now