It’s that time of year when individuals and families review their medical aid options for next year.
First, let’s consider why you might be considering a new medical aid plan:
- Your responsibilities have changed. Many young professionals begin with a hospital plan. This is generally an affordable way to ensure that you have emergency medical cover. At Profmed, our ProActive and ProActive Savvy benefits include hospitalisation with no deposits or co-payments, preventative care for early detection of dread diseases and specified vaccinations, contraceptives, chronic medication, a Trauma and HIV Assistance Programme, and access to WHISPA our Gender Based Violence Support Programme. Doctors’ consultations and procedures are paid at 100% Profmed Tariff in hospital and dentistry is paid at 135% Profmed Tariff. However, young families require more cover, and you may be looking for a plan that includes more day-to-day and specialist benefits.
- Your healthcare needs have changed. If you are young, fit and healthy, a hospital plan could be all you need. However, if you are growing older or have a chronic illness, more comprehensive cover is the way to go. It’s impossible to predict future health problems, but we know that a young family’s needs will differ from the needs of a professional nearing retirement. Generally speaking, you need more medical cover the older you become.
- Your financial situation has changed. Your health needs are always evolving, and you want to be as covered as you can be, within what’s reasonable given your budget. This is one of the reasons why professionals and families move to higher plans as household incomes grow. However, the financial constraints of the pandemic have also resulted in professionals reviewing their budgets and where they can trim back costs. Moving to a lower plan that still covers medical emergencies may be a suitable solution.
How to choose between medical plans
Here are 5 things to consider as you decide whether to maintain your current medical cover, increase your plan or decrease your plan.
- Balance budget and medical needs
Before you make any decisions, review your personal medical needs and those of any dependants who may be on your plan.
The rule of thumb is to keep your medical contributions to around 10% or less of your monthly income. Ideally, you want to access the best medical cover that you can afford, which may mean trimming back on a few nice-to-haves to ensure more comprehensive cover. The benefit of higher benefits is your peace of mind when it comes to any future healthcare emergencies.
A plan downgrade could save you monthly contributions but the longer-term out-of-pocket expenses (particularly if a family member needs to see a specialist or requires medication) could cost more in the long run. While you may be planning to switch to a plan with lower levels of cover for day-to-day healthcare services based on your current health, don’t ignore the impact that may have on your cover for major medical expenses, including cancer. Saving contributions but compromising yourself when it comes to the cover for expensive medical events that are related to current levels of health can be extremely costly down the line.
- Consider network options
Network options typically offer the same benefits, but within a defined network of healthcare facilities, which allows the medical aid to pass on discounted costs and therefore lower monthly contributions.
At Profmed, our Savvy options offer the same benefits through a large selection of network hospitals, delivering affordable benefits for the professional.
- Access financial advice
Speak to a financial advisor about your budget and medical needs. They will be able to guide you through your needs and which plans are within your budget. If you are looking at ways to trim back monthly costs, a financial advisor may help you to maintain or even increase your medical plan by considering your entire financial planning portfolio, including life and disability insurance. Healthcare is one – important – component of your overall insurance and life cover needs. Remember, your health is your most precious asset.
- Check scheme increases
Medical aids are aware that we are all cost-conscious, particularly given the constraints of the pandemic. Reviewing annual increases, how these have impacted medical contributions, how network options alleviate some of these costs and how increases translate directly into a scheme’s financial stability are all critical components to consider. At Profmed, one of our key focus areas is ensuring that we maintain our strong reserves. We will continue to always act prudently to ensure that the Scheme is in a strong financial position to support our members, and while we have kept our increases to a minimum, we have implemented the small increases required to ensure we can support our members. You can always request to check your scheme’s solvency ratio as well.
- Review medical aid versus medical insurance
Medical aid providers are required by law to provide Prescribed Minimum Benefits (PMBs) for a list of chronic disorders, including cardiac conditions, asthma, hypertension and diabetes. Health insurance providers, on the other hand, don’t have to consider these requirements because they are not subject to the same legislation.
When you pay monthly contributions towards a medical aid, if you require hospitalisation your medical scheme will pay the hospital on your behalf. Depending on your medical aid and plan there may be a small co-payment. At Profmed, on all options, hospitalisation is covered with no co-payment required upfront.
Health insurance is different. Once you have settled your hospital bill yourself you will receive a lump sum paid out to you, which may or may not cover the cost of your medical bills.
On the other hand, although medical aid plans provide more comprehensive cover, they don’t include cover for loss of limbs or personal accident disability, which health insurance does. Some health insurance plans even include death and funeral cover. Once again, a financial advisor can help you determine your specific needs.
Review and compare our benefit options here.
