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Mediclinic News : Medical schemes, from bad to worse?

Title

Medical schemes, from bad to worse?

Date

2018-02-27

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News Description

BUSINESS ESSENTIALS Member satisfaction @ medical schemes… from bad to worse? Why? 2017 was the lowest SAsci score With premiums increasing well above inflation by approximately 10% each year, expectations around value for money in private healthcare are constantly under the magnifying glass. According to Consulta’s 2017 South African Customer Satisfaction Index (SAcsi) survey for medical schemes, customer loyalty measured at 66.7%, its lowest score recorded to date. Specific areas of member dissatisfaction arise from the perception of poor value for money, complexities surrounding the understanding of scheme rules, exclusions and co-payments. This is amplified by the perception that schemes continue to increase premiums whilst at the same time, continuously reduce benefits. Unique challenges If medical schemes are not for profit organisations and the members are the shareholders, how did we get to this point where our industry has one of the lowest satisfaction scores compared to other industries? Parallel to members that are at the receiving end of private healthcare services and financial cover, are schemes in their challenges to provide a sustainable funding model to its members. Medical schemes are price takers; not price makers. Schemes are more than ever before strained by a flurry of challenges concerning an open-ended liability with no ceiling w.r.t. the funding of PMB claims, the absence of price regulation from medical service providers, fraudulent claims from both service providers and members, the over-servicing of members, over-coding on the side of providers, member anti-selection and non-declaration of medical information, the ever-increasing cost of private healthcare, as well as the rise of the empowered patient. The only source of income for medical schemes is derived from its members’ contributions and interest earned on their reserves. Put differently, the contributions paid by members, plus some interest earned, must fund the all healthcare claims of all the members and factored into this cost are all the challenges as mentioned. Expectations not met Given the fact that “empathy”, followed by “reliability”, are generally accepted as the two biggest considerations when measuring customer satisfaction, it is no wonder that member satisfaction is at an all-time low. Members naturally expect that all claims must always be settled in full. Private healthcare providers derive approximately 95% of their income from medical scheme members and the current status quo seems to be to maximize revenue income in the absence of any price regulation, while it lasts. Medical schemes, on the other hand may, according to the Medical Schemes Act, only reimburse claims in line with their rules, which contain benefit limits. Therefore, when claims aren’t paid in full, members’ expectations are not met. An additional financial burden transferred to the member not only triggers dissatisfaction in respect of an expectation not being met; it also touches a heart issue. The main gripe then centres around why a claim was not paid in full, when the real question ought to be – why does the doctor charge so much? The blame is laid at the door of the medical scheme whilst some doctors are charging more than R60 000 per hour to treat non-life threatening conditions. What is the answer? The future and sustainability of private healthcare in South Africa is currently at a juncture. Considering the potential impact of government’s plans around National Health Insurance (NHI), only a major disruption with radical changes will save it from a complete collapse. Private and public healthcare must remain separate. As far as public healthcare is concerned, we must forget about NHI. We in fact have NHI in our country – it is just not managed. Affirmative action in public hospitals must be suspended and whoever is capable and qualified to run and manage it must do so with the provision that there is a mentor programme in place. The quota system at our universities should be abolished to train more doctors, as we need more doctors, irrespective of colour. Medical schemes should be privatised to make them companies under the Companies Act. Private hospitals should be allowed to employ doctors and doctors should be left to charge a reasonable fee with the proviso that patients and medical schemes are not compelled in law to pay a blank cheque, as is currently the scenario with regulation 8 and the Council for Medical Schemes’ interpretation thereof. Will this happen? Probably not before the total collapse of private healthcare in South Africa.
Created at 2018/03/06 05:09 PM by Mediclinic
Last modified at 2018/03/06 05:09 PM by Mediclinic