With more above-inflation medical scheme tariff increases on the horizon for 2017, many consumers have been left bewildered by the escalating costs of medical care.
Most feel powerless in the face of double-digit increases such as Discovery Health’s 10.2% contributions hike, Momentum Health’s average hike of 11% and Government Employees Medical Scheme’s (GEMS’s) increases ranging from 13% to 16.8%.
These increases are coming at the same time that the South African Society of Anaesthesiologists (Sasa) is seeing a consistent below-inflation increase for healthcare practitioners and an erosion of their payments. It is becoming harder for practitioners to provide services and harder for the consumer to afford the cover.
Practitioners are being short-changed by the rising costs. Consumers are being paid different amounts by their medical schemes depending on which doctor they go to.
These, and other, issues are compounded in the absence of a collective consumer body as there is not a proper organisation in place to argue the consumer’s interests and question the decisions made by medical schemes on their behalf.
National Health Insurance (NHI) for SA is currently aiming for one national medical scheme that will allow the entire population medical cover, instead of just a percentage of the population. They intend to curb rising costs while maintaining a high standard of healthcare for everyone. This is an ideal that Sasa supports. However, the public healthcare system is not currently meeting the needs of the population, paving the way for a growing private healthcare system.
Medical schemes are trying to introduce managed care to negotiate the best rates for patients. But as the schemes try to manage healthcare costs, the question that the patient needs to ask is: "Is this treatment good for me as a patient?"
In theory, the increases should benefit the patient or medical scheme member. It is a way to enhance efficiencies and get the best possible care. However, this does not necessarily work practically.
With a move toward a global fee structure in medical care, consumers now run the risk of paying for a higher or existing level of medical service or treatment but receiving a treatment or medical service that is below that level.
There is no question that the current structure of the global scheme is not necessarily providing the best care for the patient. Rates are going up but the care package is going down.
There is a differential in product and who your scheme offers on the network. Things are getting more expensive for the patient, the doctor is getting paid less and the treatment is less.
Medical schemes have cited the reasons for the impending inflated contributions as being the rising costs of medication and of importing medical equipment, the falling rand, increasing costs of private healthcare with doctors charging higher than medical-scheme rates, an increase in the average age of principal members on the schemes and high private hospital costs.
In addition to this, schemes are also blaming increases in expenditure on hospitals where some medical schemes have been experiencing a hike in their members’ claim patterns.
According to the 2015 annual medical schemes industry trends report by Alexander Forbes Health, medical schemes are under pressure, with just more than a third of schemes achieving an operating surplus in 2014.
With the schemes’ only sources of income being member contributions and income from investments, when there is a shortfall, schemes can do one of three things: increase member contributions substantially and risk losing members; decrease benefits and run the risk of losing members; or use their reserves to offset the losses and hence endanger their financial stability in some cases.
Included in the second point above are options such as decreasing payment to the healthcare practitioner, leaving a greater co-payment for the member; instituting stricter network agreements, reducing member choice; and establishing managed care pathways that may or may not be in the best interest of the patient.
Everyone is doing their best to keep the costs in line with the medical care given, from consumers to practitioners to medical schemes themselves
Consumers, however, also need to understand that there are consequences to their own behaviour.
Other options to managing healthcare costs include encouraging a healthier lifestyle among beneficiaries, so as to decrease the need for care and encouraging more responsible usage of the benefits by the medical scheme members.
Consumers need to start evaluating their choices in the market, and there needs to be growth in consumer activism, where medical scheme members start attending annual general meetings and challenging the medical schemes to explain their decisions and choices.
Consumers need to query what they are paying for and what they are receiving, and questioning if that really is in their best interest.
As a consumer, you need to ask if these managed care organisations are not adding costs and possibly even increasing negative outcomes.
Getting the best healthcare for you and your family is a decision that should not just be based on the financial implications but also on a care basis. As a consumer you need to decide what is in your best healthcare interest. You have the right to a value-based medical network and you have the right to control the medical scheme narrative.
As a consumer you are not powerless in the face of rising healthcare costs — you are not at the mercy of your medical scheme. You have the power to hold the medical schemes accountable.
Consumers have a right to demand proper evidence from medical schemes as to what the changes are, how this affects the patient, if this is best and if it is fair.
Decisions are currently being made by medical schemes and these decisions are not necessarily supported by medical practitioners, so there is a very big risk to whether patients are being cared for properly.
Consumers do not know this and do not know the consequences of this. Consumers need to approach their medical schemes and start asking questions and getting clarity on what they are changing.
Ask how that money is allocated to the different areas such as practitioners’ fees, their own staff increases, broker fees, and so on. Is the belt-tightening being shared evenly? If practitioner fee increases are below inflation, are the scheme staff also taking a below-inflation increase?
You, the consumer, must demand a certain level of care that you think is acceptable and to compare your different options.
As a consumer you need to ask: "Why is my medical scheme costing so much? Am I getting value?"
• Natalie Zimmelman is CEO of the South African Society of Anaesthesiologists
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