Brokers must gear up
Craig Comrie, CEO of Profmed
Looking at the medical scheme environment, the drivers of change and potential risks for the future ahead, a reader commented, “It looks like the healthcare broker market should gear up to operate more like the personal financial planning space. In a shrinking market, healthcare advisers that remain in the space will have to innovate like never before…”
FAnews spoke to Jeremy Yatt, Principal Officer of Fedhealth Medical Scheme and Craig Comrie, CEO of Profmed, who shared some insights from their side.
Stats, data and trends
“During the lockdown, medical schemes saw a decrease in the number of planned/scheduled surgeries as hospitals filled up with COVID-19 patients, and non-urgent surgeries had to be cancelled or postponed. We saw more flu vaccines administered in the first month of availability than we’ve seen in the full flu season in the previous five years. The Scheme noted an increase in the number of people who joined the weight management programme. A further interesting trend noted was the shift away from scheduled C-sections to natural births. This highlights the “convenience” and non-medical reasons for having C-sections,” commented Yatt.
“A cause for concern amongst medical schemes is the lower number of people who underwent their preventative screening tests (such as pap smears) and annual check-ups during 2020. Early detection is crucial to ensure that any abnormalities can be picked up and intervened upon as early as possible,” emphasised Yatt.
“We don’t know how COVID-19 is going to progress into the future, whether there will be new variants, and whether the vaccines will be effective against them. It’s important that providers, members, funders and facilities all work together to ensure optimal safety for all – through cost-effective care to the right people at the appropriate time and most importantly, in the right setting. Only with collaboration can we emerge optimally from these unprecedented times. While the direct impact of COVID-19 has already been substantial, additional layers of delayed or indirect impact have yet to be quantified and considered (such as delayed treatment implications and effects), workforce and job losses, leading to a reduction in the ability to afford private medical care which all ultimately impacts on scheme sustainability,” added Yatt.
“We have seen significant declines in flu and other infectious diseases, fewer hospital admissions…more home based nursing and increase in home based birthing using midwives. This has not yet generated the feared underdiagnosis of conditions and more serious future hospitalisation which may still happen in the next 24 months,” added Comrie.
Healthcare consumption and behaviour
Yatt said, there will be a greater focus on technology to drive efficiencies, improve patient outcomes, and ultimately, lower the cost of healthcare to make it more accessible and affordable.
“A greater percentage of the medical scheme population are now not only willing to adopt, but also expect technology to play a greater role in managing their health, accessing healthcare benefits and more easily navigating this complex environment. Personal Electronic Health Records will be key in improving care coordination between healthcare professionals, as well as reduce healthcare costs related to duplicate diagnostic and defensive medicine. Smartphones and wearables will play a greater role in the earlier detection and intervention of emerging health risks to curtail future downstream costs. Artificial intelligence also holds many promising applications, from enhancing member experience when engaging with schemes, to lowering scheme administration costs, while enhancing patient experience and outcomes in treating health conditions,” said Yatt.
“Another important factor to consider is the type of disease currently most prevalent within South Africa. At the turn of the century, the biggest threats posed were that of infectious diseases i.e. pneumonia, tuberculosis and HIV; this has seen a significant change with ‘diseases of lifestyle’ now being rampant within the population. This term usually includes conditions such as diabetes, hypertension and hypercholesterolemia which have debilitating and often deathly consequences. The ripple effects of these conditions lead to disability and an increased need for care which comes at a high cost. The challenge with these conditions lies with the difficulty in prevention and treatment,” continued Yatt.
“Added to the above burden of disease is the increase in cancer prevalence, as well as mental health illness. The number of new cancer cases is rising worldwide and increasing financial pressure on even the most advanced health systems. The most rapid and worrying escalation is seen in least developed countries, where it is more difficult to afford it. South Africa is not exempt from this problem, and it is incumbent on all relevant healthcare stakeholders to optimally manage and reduce this scourge of disease. Mental health disorders may be as a result of many factors, some of which may be the impact of HIV and other chronic conditions, disorders during the perinatal period and the result of trauma or substance abuse. Mental illness has a significant economic impact, not only as a result of the medical care and services needed, but it may also result in a loss of productivity, unemployment and disability benefits,” said Yatt.
“Flexible financial products are also key. One of the many realisations we had in 2020 was how quickly life can change, and how important it is to have responsive financial products that can adapt to changes in a person’s financial and health status,” added Yatt.
Challenges remain
“Medical schemes operate within stringent regulatory and legislative constraints, which can often inhibit product design innovation, as well as increase the cost of medical scheme contributions. The incorporation of new, innovative digital health technologies holds many promising opportunities, but the challenges of the Protection of Personal Information Act (POPI), adoption of the use of these technologies by providers, and the costs associated with building these technologies into the customer journey, remain,” said Yatt.
“We need mandatory scheme membership for the employed, a complete review and implementation of PMB legislation and we need clarity on NHI’s impact on medical schemes,” said Comrie.
Brokers should be cognisant
“Brokers should be cognisant of the fact that the characteristics of the modern medical scheme member are changing, as Millennials begin to overtake their predecessors in the workplace. Millennials are shrewder, do their own research online and want innovative, customisable financial products that meet their specific needs. In past years, broker training was focused on assessing companies as a whole and addressing the needs of the collective. Here, the value was in having the skill to gather the correct set of data, to analyse and to assess the short- and long-term needs of the clients, and to guide them on how to preserve their health and reap benefits from doing so. Also, guiding the group on how to select the correct scheme, plan options and align it to their healthcare policy and subsidy. The ‘new market’ is moving towards being predominantly the individual member, which brokers must gear towards, in order to remain relevant. Corporate brokers are under incredible threat here,” emphasised Yatt.
“As companies are retrenching, we will begin to see more people starting their own businesses or even just being self-employed. These members use a smartphone all day long, know how to do their own research and Google, while the broker is talking to check the facts,” concluded Yatt.
“Getting the right healthcare cover is becoming even more important. This, however, will always require a specialist broker to guide a person to make the right choice,” concluded Comrie.
Writer’s Thoughts:
While the characteristics of the modern medical scheme member are changing, of concern is the true impact that COVID-19 will have on the industry. As mentioned above, the indirect impact of COVID-19 has yet to be quantified and considered (such as delayed treatment implications and effects), workforce and job losses, leading to a reduction in the ability to afford private medical care… can we emerge optimally from these unprecedented times? If you have any questions please comment below, interact with us on Twitter at @fanews_online or email me.
