Medical aid is expensive and not everyone can afford the high premiums. If you’re worried about healthcare expenses for you and your family, have a look at some of the cheaper alternatives to medical aid, like hospital cash back plans and primary health insurance policies. They offer some cover for when you are in hospital, and cover for primary healthcare.
What’s the difference between a medical aid, a hospital cash back plan and a primary health insurance policy?
A medical aid offers cover for your healthcare needs such as hospitalisation, medication, GP and specialist visits. There are a number of medical aid options available ranging from full comprehensive cover for most procedures at any doctor and hospital, to cover for certain conditions at certain doctors and hospitals. The more comprehensive the cover, the more expensive the premium.
By law, medical aids are required to cover prescribed minimum benefits, known as PMBs. There are 27 PMB and 270 chronic conditions, including some cancers, high blood pressure, diabetes and asthma. Your medical aid has to cover the cost of care for these conditions.
Medical aids will pay your healthcare provider such as your doctor, hospital or pharmacist directly, or they will reimburse you for the payments you make.
Hospital cash back plans and primary health insurance policies are a form of insurance and will cover a set amount in certain circumstances. They won’t cover all your healthcare costs and are not required to cover PMBs. Hospital cash back plans and primary health insurance policies pay directly to the member or life assured when there is a claim, they cannot pay the healthcare provider.
Hospital cash back plans pay a set amount per day in hospital, usually after a certain time has expired such as 48 hours. These waiting periods vary from policy to policy. Hospital cash back plans can pay up to R3 000 a day while you are in hospital but the maximum amount you can receive each year is R20 000.
Primary health insurance policies have set amounts of cover for primary health care services. For example, GP visits, dentistry, some blood tests, maternity care, optometry and medicines should be covered, but may be limited to a certain number of visits or Rands each year.
How much do they cost?
The cost depends on how much cover you have, how many people are covered on your policy and the age of the people covered. Here are some examples:
FNB’s Health Cash Plan starts at R50 a month for a hospital cash back plan for one person, family members can be added at R12 a person. Clientele Life’s hospital cash policy starts at R268 a month for one person.
Oneplan’s Core Primary health insurance policy costs R365 a month for one person, R708 for a couple and R1 172 for a couple and two children. GetSavvi’s Primary Care Plan costs one person R340 a month and a family R560 a month.
Know the terms and conditions
Compared to medical aids, hospital cash back plans and primary health insurance policies are a lot more affordable but be aware that the cover is limited and there are waiting periods and conditions.
Hospital cash back plans can only pay a maximum of R3 000 a day for a hospital stay or R20 000 a year lump sum payment. If you are unfortunate enough to have a long stay in hospital your costs could be significantly higher than this.
A study in the South African Medical Journal found most people spent 4.9 days in hospital for their hospital stay.
Hospital cash back plans nearly always pay claims only from the second or third day of your hospital stay. So although your plan may offer R2 000 a day for the hospital visit this is likely only to be after the second or third day in hospital. Many claims are denied because the hospital stay is shorter than this.
Your plan may also stipulate a full day in hospital – which is a full 24 hours – which could affect the amount you can claim. To use an example: you are in hospital for three and a half days and your hospital cash back plan pays out R2 000 for each full day after 48 hours in hospital. You may only claim one full day for your three and half day stay because the first 48 hours don’t count towards the claim, neither does the half day.
Hospital cash back plans also usually have waiting periods for certain conditions ranging from 3 months to 12 months. A waiting period is when the policy has to be in force for a certain time before you can claim any benefits.
For example, if you are having a baby you can only claim maternity benefits if you have had the policy for 12 months or more.
Primary health insurance policies cover out of hospital expenses such as GP visits, medicines, some blood tests and some dentistry. They don’t cover hospital costs such as emergency room visits unless an added benefit is taken, which will mean a higher premium.
Read your policy well
Because there are so many conditions and waiting periods you need to read your policy well and understand it so that you know when and how you can claim and if the policy will meet your needs. Ask the company what the waiting periods are, when cover begins and how much it is. Also ask why claims are denied so you get a feel for when the company pays claims and when they don’t.
Care at a public hospital isn’t always free
You might be wondering if it isn’t more worthwhile to use South Africa’s public healthcare facilities, which are much more affordable when compared to private hospitals. While clinic visits in South Africa are free, if you are employed and earning more than R70 000 a year, you will be required to pay some or all of the costs of your care in a public hospital. So a claim from a hospital cash back plan could be used for this expense.
So, are they a good deal?
When you don’t have a medical aid, some cover is better than none and payments from a claim can put cash in your pocket when you need it most. Some policies also offer additional benefits such as HIV testing and counselling, and funeral benefits such as a lump sum amount for a funeral or repatriation costs.
These policies are an alternative to medical aid when medical aid premiums are unaffordable. If you can manage your healthcare costs well, they can go a long way to making sure medical costs don’t hurt your pocket too much, and they can provide you with some income if you cannot earn because you are in hospital.