When you’re little, you fear the doctor; when you grow up, you fear the doctor’s bills. The solution? You’ve decided to take out some kind of medical cover to alleviate your worries. Good idea! But what should that cover look like? Should you invest in a medical aid or health insurance policy? While these terms are often used interchangeably, they are in fact two very different forms of medical cover. It’s up to you to decide which of these options will pay off (and more importantly, pay out) in the long run.
Medical Aid vs Health Insurance: Key Differences
Medical aid schemes typically cover expenses associated with necessary medical treatment. Most medical aid schemes will restrict its members to only consulting healthcare specialists, who are part of a provider’s network, and only offer cover for a limited number of treatment options. However, many see medical aid as the more comprehensive option, despite its lack of flexibility.
Health insurance, on the other hand, offers the simple solution of cash benefits paid out during a hospital stay. This lump sum pay-out does not vary, no matter what treatment you require or healthcare providers you would want to use. The money would be paid directly to you and you can decide what hospital, doctor or specialist you would prefer to see for treatment.
There are a number of new health insurance products available, which are relatively new to the healthcare marketplace, including personal accident risk cover like disability and loss of limbs, inability to work, salary protection, death and/or funeral cover. These came about as a result of a steep rise in medical aid premiums that most South Africans couldn’t afford. The response from perceptive health insurance providers was to offer insurance products at lower premiums that can be tailored to suit their customer’s needs.
Whether you are looking for health insurance or medical aid, there are a few things to consider before taking out a policy.
What Are Your Medical Needs?
Is your immune system iron-clad or is the doctor’s office your second home? When looking at your healthcare options, consider how often you would have to make use of them. If you have a chronic medical condition, think about the cost of regular doctor’s visits and the stream of medication you may need to manage said condition. That kind of medical attention would be more affordable with the right medical aid provider on your side. On the other hand, if you feel you’re fighting fit and only visit your doctor an average of one or two times a month, think about signing up for health insurance or a hospital plan instead, in case of an unexpected injury or illness.
Keep in mind that both medical aid schemes and health insurance policies have a waiting period that must be up, before you can make use of your policy and all it’s benefits. These waiting periods can last between three to six months depending on the policy and your provider as well as any pre-existing conditions you have when applying for cover.
What Type Of Healthcare Can You Afford?
The long and short of it is this: health insurance premiums will generally seem far more affordable than the premiums you would pay for a medical aid scheme. If you’re wondering why medical aid providers are so immovable on their premiums, you may be surprised to find out that these providers are required by law to provide Prescribed Minimum Benefits (PMBs) for up to 27 chronic conditions, including asthma, cardiac conditions, diabetes, and more. Although health insurance providers fall under the Short- and Long-term Insurance Acts, they don’t face the same restrictions, which is what allows them to be so flexible in their premiums and product offerings.
Say you have a medical aid and are hospitalised, the cost of the treatment (and potentially the hospital stay) would be paid out to the hospital directly. Having health insurance instead means you receive the pay-out and have to settle accounts with the hospital yourself. The duties of a health insurance provider generally come to an end once a policy has been paid out; therefore, policy holders must be very alert to the potential costs of their treatments as they are responsible for managing the payment of said treatment.
Check Out The Exclusions And Benefits Of Your Medical Scheme
Although medical aid has garnered the reputation for providing more comprehensive cover, it doesn’t always cover personal accidents that result in disability or the loss of limbs. Your typical health insurance policy, on the other hand, does offer these benefits. Health insurance is also more likely to include death and funeral cover. However, health insurance may not always be available to cover regular prescription medication as is the case in most medical aid schemes. The responsibility of managing the health insurance pay-out sits squarely with the claimant.
Get Medical Cover Before You Need It
No matter how you go about it, if you choose to make your health a priority, invest in some form of medical cover to be prepared for anything. Some folks even opt to get both medical aid and health insurance, using the health insurance as a kind of gap cover to bridge where your medical aid falls short.
A convenient place to start your search for medical cover is your employer. Some companies offer their employees cheaper rates on a company policy, so query this with your HR department. Even if you don’t join your employer’s medical scheme, you could keep the pricing and scope of cover in mind as you investigate other options. Alternatively, price-comparison websites, like Isibaya Deals, can assist in your search for affordable medical cover by sending you several quotes from a number of leading insurance providers.
Hopefully this guide can help you to make a clearer decision on what option will best preserve your health and that of your family.