Healthcare opportunities in tough times

01 June 2009 Adrian Hofman, Health & Accident

In the present economic environment, we hear every day how various large organisations are downscaling, cutting back, reducing staff and, in some cases, closing down. Consumers, too, are drastically reducing their spending. Are there still opportunities for healthcare brokers?

Medical aid membership fees, as well as the fees charged by medical suppliers, are not decreasing. Simultaneously, most companies and consumers are faced with tight budgets. However, in these hard times it may be beneficial, both to your clients and yourself, to ensure that in the event of various healthcare events, your clients are enjoying the right cover, so as not to expose them to greater liabilities, which they can ill afford at this time.

Existing clients

Generally speaking, most employees are contracted on a "cost to company" basis and as a result, they are able to select one of the various options of medical aid plans offered. Various opportunities exist in terms of some of the medical aid options – some have a co-payment for selected, or every, hospital admittance. There are products available from various insurers that cover some, or all, of these co-payments. These products range from R70 to R100 p.m. per family – an affordable amount for a family who may not be able to raise the cash required for co-payments on already over-stretched budgets.

Filling in the gaps

There are also various medical aid options which offer hospital cover at less than the fees charged by various medical specialists, which leaves the member exposed. In such cases "Gap" cover would be a solution to be offered to an existing client.

If an existing medical aid client is travelling abroad, they will require medical travel cover. The market offers various options that may be purchased on an ad-hoc basis or on an annual corporate basis.

Contract personnel

Due to the economic climate, various corporate organisations are employing contract personnel for specified contract periods. These contracted employees are unable to access the corporate employee benefit packages and as a result, they are required to purchase their own healthcare cover. The solution may entail a medical aid scheme or various restricted insurance products – all dependent on the budget, which can be maximised with the assistance of a well-informed broker.

Sporting events

There are various forms of healthcare cover becoming available in the market for various adult and student sporting events.

In addition, we have the various football tournaments taking place in South Africa this year and next year. If a tour operator or hospitality client is involved in some of these events it may be opportunistic to ensure they have access to cover for their visitors.

RAF shortfalls

The changes to the Road Accident Fund (RAF) legislation is going to affect all of us during the next two years, because there will be a knock-on effect either from the industry (hospitals and medical suppliers) or from our medical aid schemes.

Medical aid schemes do not cover loss of earnings and the new RAF is restricting both loss of earnings and medical aid expenses (combined) to R160 000 per injured person per year! Fortunately, there are various new insurance products that have been introduced to the market to cover these shortfalls and brokers should ensure their clients are adequately covered.

Pro-active brokers will find that even under these trying conditions there are many opportunities to add real value to their clients and expand their income streams.

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