Get the best advice on medical costs from your adviser

By: Michael Emery

Making sure your family has the best possible medical cover is a priority, but achieving the goal can be challenging. Medical plans are complex and there are many products, including gap cover to ensure high costs don’t derail your finances. Working out which plan is best for you and what the terms mean is time-consuming and mistakes could have dire consequences. Building a relationship with a reputable adviser remains the best way of ensuring you understand what the options are, and what’s best for you.

Some of the most common issues members face – and what leading advisers advise:

Can I reduce the costs of medical coverage?

Charleen Rix, the head of Sasfin Health Consulting, says the key factor is to understand your usage patterns and compare them with what your plan offers.

“Only when you understand what medical cover you need can you make an informed decision about whether a different plan would be more suitable and what gap cover product should be added,” she says. “There’s always a risk that lowering one’s medical cover could make one vulnerable to unexpected medical expenses that have to be covered by the member.”

What are the implications of cancelling or downgrading my medical cover?

Westley van Rooijen, the head of Healthcare at Austen Morris Associates, says cancelling medical aid cover is a radical decision. “It will expose you to more risk in the event that you do contract a serious medical condition – How are you going to mitigate that risk?

“Cancellation could also complicate things if you later decide to rejoin a medical scheme. Many people think that they can cancel medical cover and retain their gap cover, which is impossible. Consulting with a reputable adviser is essential,” he said.

Similarly, members under financial pressure often consider downgrading their medical cover. Again, says Van Rooijen, expert advice is necessary. An adviser can help find a medical scheme that has a better financial profile and help source a gap cover that would help cover shortfalls.

How can I get the best value from my plan and cover?

Rix says that one of the best ways of maximising value from one’s medical scheme is to use the suppliers on its network. “These approved suppliers’ rates will be fully covered by the medical scheme, whereas out-of-network suppliers might charge higher rates which would not be fully covered. In the latter case, gap cover would be advisable,” she says.

Will the gap cover finance all in-hospital shortfalls?

Van Rooijen says gap cover will typically cover the shortfalls between what the medical scheme pays and what hospital procedures cost for authorised procedures where the specialist/s charges above the medical scheme tariff.

“Make sure you have provision for the medication needed on release from the hospital if it is not fully covered by your medical plan,” he adds.

Can I enrol my parents on my gap cover, and does it cover my adult children if they are on my medical aid?

Most gap cover plans don’t cover extended family, except for adult children who are either full-time students or live with a disability, says Rix. A separate gap cover policy would need to be taken out, even in the case of adult children who are on the same medical scheme. Be sure to consider the policy terms and conditions, and speak to an accredited adviser.

Does gap cover pay for everything the medical scheme does not?

“It’s a common misconception that gap cover can be used to pay for medical expenses when your medical savings account is exhausted or when you are in a self-payment gap,” says Rix. “In fact, gap cover complements the medical scheme, coming into play when there is a shortfall (or gap) between what the medical scheme pays and what is charged. In these cases, the medical scheme is not paying, so gap cover does not apply.”

Similarly, she adds, if a particular medical procedure is not covered by the member’s medical scheme, gap cover would not apply. It is important to note that gap cover is not a medical scheme, nor is it a replacement for a medical scheme, therefore, it may not act as a medical scheme.

One cannot overestimate the value an expert adviser can add. Medical schemes and complementary products, such as gap cover and medical insurance, are carefully designed for specific profiles. Care needs to be taken to sign up for one that is suitable to one’s life stage. In every instance, members need to understand what is and what is not covered by a medical scheme or gap cover policy. An adviser can help ensure you make the right choices. Consult a reputable adviser to find the best medical cover tailored to your needs and to ensure you and your family are fully protected.

* Emery is the marketing executive at Ambledown Financial Services.

PERSONAL FINANCE