Supersize your medical cover

Last updated on 13th December, 2017 at 10:20 am

Medical aid only goes so far covering real medical expenses and there is often a need to take out top-up insurance. Why the gap – and how to bridge it?

Like hundreds of thousands of South Africans, you’ve probably joined a medical aid, either individually or through work. You signed all the papers, but when you later read the small print, you realised that you weren’t always covered for the full cost of treatment and the fees of medical professionals. There is a real and often substantial gap between what a medical aid is obliged to pay and the actual cost of the treatment, which can result in surprise additional costs that can be eye-watering. Most medical aids warn that professionals can increase their fees up to four times that of medical aid tariffs. To be clear, this is no real fault of the medical aid or scheme, this is a major failure in the system.

How tariffs are calculated

How it works is this: there is a national pricing structure set by the government for every conceivable medical procedure, whether it’s a tonsillectomy or the birth of a child. This is called the National Health Reference Price List (NHRPL) published by the Department of Health to determine the “reasonable” cost of healthcare services in South Africa. These costs are generally high enough, but some medical professionals can charge up to four times the so-called reasonable amount.

A simple tonsillectomy

Let’s say your daughter needs to have her tonsils out. This is a routine tonsillectomy – in and out in no time, a straightforward procedure. On the NHRPL the whole procedure might be rated around R4 000, but the true cost of the procedure is nearer to R9 000. The medical aid will honour its R4 000, but you will have to fork out the extra R5 000. Now, if we were to consider a critical procedure such as heart bypass surgery, then these extra costs could run to more than R100 000.

Why the gap?

This gap is a contentious issue and a huge political football that government has promised to address and do something about. However, after a couple of false starts to new legislation, that gap remains. Responsible medical insurers now make gap cover available to complement medical aids and thereby offer you additional protection against health-related risks. “Gap cover is for hospital treatments either in hospital or out-of-hospital by specialists,” says Feroza Joosub of Gap Cover: Strategic Business Development at Sanlam.

Where to find it

Your insurance broker or financial adviser will be able to point you in the direction of an appropriate gap cover provider. There are innumerable offerings that can be used in conjunction with any medical aid. The cost is quite low, with premiums ranging between R90 and R140 a month. It’s worth every cent.

By Paul Kerton

Find out more about Sanlam’s Gap Cover insurance. Click here >