The latest South African Consumer Satisfaction Index (SAcsi) for the five benchmark medical aid schemes has been released.
Business Tech reports that now in its fifth year, the SAcsi Benchmark for Medical Schemes – run by research firm Consulta – offers impartial insights into the South African medical schemes industry by blending a Customer Expectations Index, Perceived Quality Index and a Perceived Value Index to achieve an overall result out of 100.
South Africa’s top five medical schemes are included in the industry index: Discovery, Bonitas, Medihelp, Momentum and GEMS. The sample included 1,757 consumers who were randomly selected for inclusion in the 2017 survey.
Consulta CEO and founder, Professor Adré Schreuder, said that the medical schemes industry has one of the lowest overall satisfaction scores compared to other SAcsi surveys, as medical aid is one of South Africans’ most costly monthly expenses.
“Many customers experience poor or low value for money, with many referring to complex rules, exclusions and co-payments. It is often considered a grudge purchase,” said Schreuder.
“Industry premiums increased by around 8 to 10%, which is well above inflation. Expectations around value for money will come under even more pressure when consumers are expected to contribute to the government’s proposed National Health Insurance (NHI) if it is launched as expected in the coming years,” he said.
The report says the SAcsi survey for medical schemes was not conducted in 2016, with the 2017 data measured against the 2015 and 2014 surveys. With a SAcsi score of 74.8, Discovery is well in line with the industry average of 74.2 and has improved its score marginally from 74.1 in both 2014 and 2015. Discovery overtook Liberty Health, which had merged with Bonitas during 2016. Medihelp achieved a SAcsi score of 72.6, significantly up from its score of 70.7 in 2015.
Satisfaction by Government Employees Medical Scheme (GEMS) members deteriorated further as members are the least satisfied. Its score fell from 74.3 in 2014 to 64.3 in 2017.
Bonitas scored 73.1, which was 2.1 points down from its 2015 score and almost three points down from its 2014 score of 75.9. Momentum fell to 72.2 from 75.6 in 2015. “The decline in Bonitas’ score could possibly be attributed to its merger with Liberty Health. It could have put strain on the business as it would be managing a much larger member base,” said Schreuder.
“Medihelp’s recent turnaround strategy seems to be paying off. While it previously offered low premiums, customers were often faced with surprisingly high co-payments. It has since increased premiums and moderated co-payments to make their service more predictable,” he said.
“GEMS, on the other hand, failed to meet its customers’ expectations, evident by the verbatim commentary on complaints and problems experienced by members.”
Bonitas Medical Fund has, meanwhile, announced a weighted increase of 8.7% in contribution costs for next year, while Discovery announced one of 7.9%, reports Fin24. A weighted increase is not just an average of the increases across all the options – it takes into account the number of members belonging to the various options. The increases are the lowest seen in several years: last year Bonitas announced a 10.98% average increase, and Discovery Health one of 10.2% for 2017, and most other schemes followed suit with double-digit increases.
The report says if the announcements from Discovery and Bonitas are anything to go by, other scheme members may also be in for lower-than-usual membership contribution increases for 2018. Most of the other schemes are yet to announce their 2018 increases.
Medical inflation is estimated at 8.93%, and is always significantly higher than CPI inflation, which came in at 4.8% for August, Statistics South Africa announced.
The report says worldwide, medical inflation is driven by the high cost of medical technology, the high cost of private medical care, and the expense of medication. In addition, in South Africa, the falling rand adds to the woes of consumers who are medical scheme members.
Over the last 16 years, the average year-on-year increase of medical scheme contributions has been 7.6% – 1.6% higher than the Reserve Bank's ceiling for inflation targeting of CPI between 3% and 6%.
The report says for all schemes, the challenge lies in dealing with the rising costs of healthcare, and at the same time curbing expenditure. A further challenge lies in keeping up with new trends in healthcare, and adjusting benefit schedules to reflect this.
Bonitas has added several additional benefits for members in 2018, including an unlimited terminal healthcare benefit on all options and a separate benefit for contraception. “Our mission is the affordability and accessibility of quality healthcare, and we have to carefully balance costs while ensuring members receive rich benefits,” says Gerhard van Emmenis, principal officer of Bonitas Medical Scheme.
The report says the rising cost of medical scheme membership in South Africa has meant that membership numbers across all schemes have remained largely static over the last few years, with a total of 3.95m principal members and 8.81m dependents covered by the various schemes by the end 2015. There is no indication that this has changed significantly.
[link url="https://businesstech.co.za/news/business/200806/best-and-worst-rated-medical-aid-schemes-in-south-africa/"]Business Tech report[/link]
[link url="http://www.fin24.com/Money/Health/medical-schemes-under-pressure-to-keep-hikes-under-10-20170921"]Fin24 report[/link]