Medical aids are increasingly unaffordable - Maya Fisher-French asks them why

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Why South African medical aids got so expensive

Prescribed minimum benefits (PMBs) covering 271 life-threatening conditions and 26 chronic illnesses are the biggest cost driver for medical aid schemes.

This is according to Medshield Medical Scheme acting principal officer Alan Fritz, who spoke to personal finance journalist and educator Maya Fisher-French.
 
Such a ridiculous excuse, specialists that charge 700% of the normal rate let’s make the entire medical product portfolio expensive.
Its like motor insurance companies saying your insurance on your Corolla is R2000 a month due to the cost of changing brake pads on a Lamborghini.
 
Just an idea, medical aids expensive because they "non-profit".

Here's another truth "the earth is flat".
 
While medical aid in Sa is not cheap it’s still very good value for money. Unlimited hospital cover is just under R2k on most Medical aids.

Go look at similar medical cover in the USA and get your eyes opened, and on top of the very high rates they are allowed to load your premium for pre-existing conditions. So if you get sick or disabled they gouge you right when you least can afford it.

In Sa you can join a medical aid a total wreck and the only exclusion other than late joiner fees if you are over 35(or thereabouts) is a 6-12 month waiting period for pre-existing conditions.
 
Such a ridiculous excuse, specialists that charge 700% of the normal rate let’s make the entire medical product portfolio expensive.
Its like motor insurance companies saying your insurance on your Corolla is R2000 a month due to the cost of changing brake pads on a Lamborghini.

Did you read the article?

“However, the problem is not necessarily the range of care medical schemes must provide at cost, but specialist doctors that take advantage of the PMB regulations.

“There are specialists that charge as much as 700% of the medical scheme rate, and these are sucking the schemes dry,” said Fritz.

In its 2020 industry report, the Council for Medical Schemes reported that medical aids spend R866.02 on PMB per average beneficiary member.

This sets a floor for the cheapest medical aid plan in South Africa — they must charge at least R866.02 to cover the average cost of PMBs.”

R866 is the baseline cost each member must pay each month just for the Medical aid to cover the PMB claims made in that month. The PMB system is milking medical aids and service providers are complicit in the milking, easy meat for them because medical aids have to cover it despite them charging rip off rates.

Weird situation, why are medical aids obliged to cover providers of PMB that overcharge, surely the same rules apply as in the rest of the policy in that they will only cover in-network or contracted providers and at the specified rates?
 
Did you read the article?

“However, the problem is not necessarily the range of care medical schemes must provide at cost, but specialist doctors that take advantage of the PMB regulations.

“There are specialists that charge as much as 700% of the medical scheme rate, and these are sucking the schemes dry,” said Fritz.

In its 2020 industry report, the Council for Medical Schemes reported that medical aids spend R866.02 on PMB per average beneficiary member.

This sets a floor for the cheapest medical aid plan in South Africa — they must charge at least R866.02 to cover the average cost of PMBs.”

R866 is the baseline cost each member must pay each month just for the Medical aid to cover the PMB claims made in that month. The PMB system is milking medical aids and service providers are complicit in the milking, easy meat for them because medical aids have to cover it despite them charging rip off rates.
I did, some specialists are charging 700% of the PMB. Who are these specialists and why do they charge this amount? Is it the members that must now all be penalised for this?
Whats the ratio of members paying 700% of their PMB to said specialists
Do you pay or know of anyone paying R6000+ a consultation? I’m sure there are some but it’s very limited number of people for very rare illnesses, let’s blame those guys and make everyone else subsidise them then blame the specialist doctor who is a master in his field for small families having to fork out more to have their 6 year olds eye tested.
 
Whats this normal rate and where does it come from ? This so called rate is out dated and doesnt even cover the cost price of things in some cases.

For example do people know how much it costs to maintain a MRI machine ?

Also you paying for the Dr's knowledge, experience and skill not their time. Dont like it find a cheaper Dr
 
I did, some specialists are charging 700% of the PMB. Who are these specialists and why do they charge this amount? Is it the members that must now all be penalised for this?
Whats the ratio of members paying 700% of their PMB to said specialists
Do you pay or know of anyone paying R6000+ a consultation? I’m sure there are some but it’s very limited number of people for very rare illnesses, let’s blame those guys and make everyone else subsidise them then blame the specialist doctor who is a master in his field for small families having to fork out more to have their 6 year olds eye tested.

Well that appears to be the issue, something in the PMB legislation forces the Medical aids to cover PMB providers no matter the cost and these providers are milking the system at the averaged cost of R860pm per scheme member.

So the first R860 I pay each month for medical aid goes to cover the monthly costs of PMB claims the scheme has to pay out in that month.
 
Whats this normal rate and where does it come from ? This so called rate is out dated and doesnt even cover the cost price of things in some cases.

For example do people know how much it costs to maintain a MRI machine ?

Also you paying for the Dr's knowledge, experience and skill not their time. Dont like it find a cheaper Dr
What’s a cheap doctor cost?
See a cheap Dr, let’s use R400 a consultation assuming that’s cheap.
R400 consultation he tells you go for blood tests for abc
R400 blood tests
R200 to discuss blood tests
R100 for script for medication
R400 for medicine
Thats R1500 total, where do they get R866 from?
 
What’s a cheap doctor cost?
See a cheap Dr, let’s use R400 a consultation assuming that’s cheap.
R400 consultation he tells you go for blood tests for abc
R400 blood tests
R200 to discuss blood tests
R100 for script for medication
R400 for medicine
Thats R1500 total, where do they get R866 from?

Really?
Use your imagination…
For instance the monthly costs to manage kidney failure and dialysis, I’ve heard that costs there can easily be in the range of R20-50k pm.

It seems a large part of the issue is medical schemes can’t apply the same medical aid rate limits on PMB service providers as they can with the rest of the medical interventions covered. Or add exclusion’s that only cover the PMB services if done at a network hospital or contracted provider.

And people with existing PMB medical issues can’t be excluded from joining a medical aid, so if you develop kidney failure you can join a medical aid and have access to full benefits after a 6 months window with zero loading to your premium, other than late joiner fees if they apply.

So you can join a a medical aid hospital plan while needing R40k of PMB expenses covered per month and you’ll pay the same R2k as I do yet I don’t make any PMB claims.
 
So when my daughter was born, I got copied in on the bill of the hospital, medical aid paid. But as she was in the ICU for 2 months, the Doctor, would make twice a day rounds, if she was there for an 1/2 hour, she would have done her rounds twice over, basically checking charts and having a quick chat with the head nurse per baby. There was about 12 to 15 babies, on my bill, it was R3000 per visit x 2 visits per day x 15 babies. Her fee was like 80% of the bill. Not the hospital, not the birth etc. The doctor.

So right there is part of the problem. She should rather get paid a fixed rate per hour. Milking it for all it is worth.


This was some time ago.
 
Did you read the article?

“However, the problem is not necessarily the range of care medical schemes must provide at cost, but specialist doctors that take advantage of the PMB regulations.

“There are specialists that charge as much as 700% of the medical scheme rate, and these are sucking the schemes dry,” said Fritz.

In its 2020 industry report, the Council for Medical Schemes reported that medical aids spend R866.02 on PMB per average beneficiary member.

This sets a floor for the cheapest medical aid plan in South Africa — they must charge at least R866.02 to cover the average cost of PMBs.”

R866 is the baseline cost each member must pay each month just for the Medical aid to cover the PMB claims made in that month. The PMB system is milking medical aids and service providers are complicit in the milking, easy meat for them because medical aids have to cover it despite them charging rip off rates.

Weird situation, why are medical aids obliged to cover providers of PMB that overcharge, surely the same rules apply as in the rest of the policy in that they will only cover in-network or contracted providers and at the specified rates?

But that doesn’t make sense though.

They don’t pay the 700% someone asks.

PMB’s are capped and any doctor asking for more you need to pay out of your own pocket.

So how is that bleeding them dry?
 
I did, some specialists are charging 700% of the PMB. Who are these specialists and why do they charge this amount? Is it the members that must now all be penalised for this?
Whats the ratio of members paying 700% of their PMB to said specialists
Do you pay or know of anyone paying R6000+ a consultation? I’m sure there are some but it’s very limited number of people for very rare illnesses, let’s blame those guys and make everyone else subsidise them then blame the specialist doctor who is a master in his field for small families having to fork out more to have their 6 year olds eye tested.

None of it makes sense because the Medical aids don’t actually pay 700%.

The PMB’s are prescribed entirely and doctors can only claim up to the maximums.

Unless other medical aids have a screw loose and not operating correctly like Discovery?
 
So when my daughter was born, I got copied in on the bill of the hospital, medical aid paid. But as she was in the ICU for 2 months, the Doctor, would make twice a day rounds, if she was there for an 1/2 hour, she would have done her rounds twice over, basically checking charts and having a quick chat with the head nurse per baby. There was about 12 to 15 babies, on my bill, it was R3000 per visit x 2 visits per day x 15 babies. Her fee was like 80% of the bill. Not the hospital, not the birth etc. The doctor.

So right there is part of the problem. She should rather get paid a fixed rate per hour. Milking it for all it is worth.


This was some time ago.

Not a fixed rate per hour, but rather a capped rate per patient for the entire procedure end to end.

Or pro-rated based on actual time spent and not this paying an hour bullshit for 5 minutes.

I mean get your very example one has to ask how could they charge 24 hours for 12 babies when they weren’t even working 24 hours in total that day.

It’s clearly and blatantly a broken system.
 
For anyone who has ever dealt with any medical administrative business, The clear cause of expensive medical aid, is high administrative expenses

Patients and Medical professionals end up paying large fees to hospital groups for facilities and large administrative staffs to deal with overly complex medical aid claims systems.

The system has almost no pressure to simplify its administration, since they are very profitable the way it is now and there is no pressure from the public sector to become more efficient.

In the lack of a properly competitive market, forward looking legislation would need to look at simplifying or limiting the administrative fees that can be levied for care.
 
So when my daughter was born, I got copied in on the bill of the hospital, medical aid paid. But as she was in the ICU for 2 months, the Doctor, would make twice a day rounds, if she was there for an 1/2 hour, she would have done her rounds twice over, basically checking charts and having a quick chat with the head nurse per baby. There was about 12 to 15 babies, on my bill, it was R3000 per visit x 2 visits per day x 15 babies. Her fee was like 80% of the bill. Not the hospital, not the birth etc. The doctor.

So right there is part of the problem. She should rather get paid a fixed rate per hour. Milking it for all it is worth.


This was some time ago.
And what would the percentage cost for that checkup be in terms of medical insurance, admin overheads, etc.? What happens if they miss something in that check up?

The per hour rate doesn't really work with a doctor, some are better than others. They might/probably make quite an income with ward rounds, but those rounds can also often have a kid that takes an hour to sort out instead, etc. And then what about consultations, I know quite a few docs that will charge you the base half hour even if it goes on for an hour, it's part of the job. Some things you gain, some you lose.

An issue with the prescribed costs by the medical aids is that in 2007/8 or some time around then, they wanted to introduce a new system so they put that system on hold, meanwhile no adjustment for inflation for years, and then normal inflation instead of medical inflation, so then you have these odd 300-1500% of charge, and people think they're being ripped off because it's more than 100% because they don't understand the back story. The entire thing needs to be renewed for what 100% is, and then people can better see who is ripping off patients when charging over 100%.
 
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