4 minute read
Benefit enhancements and digital innovations
By Leo Dlamini BESTMED MEDICAL SCHEME
The COVID-19 pandemic has altered the landscape of many industries, including medical schemes. In response, medical schemes have had to consider technological innovations to help protect the health of their beneficiaries during healthcare consultations and various other interventions, including assistance with depression and anxiety.
ClAIMS RAtIO tREndS
The Council for Medical Schemes (CMS) requires all South African medical schemes to have a minimum reserve level of 25% to ensure solvency in the event of a sudden and/or unexpected increase in claims.
For the 2020 financial year, most schemes recorded lower claims ratios, well below the industry average of the prior five years, and therefore better financial results for the year. Medical schemes have had to consider the best ways in which to use their reserves to meet their beneficiaries’ healthcare, as well as financial, needs. An important consideration for many schemes is that the buffers accumulated until 2020 would most probably be sufficient to cater for near-term risks; however, over the long term economic challenges consequent on the COVID-19 pandemic may strain an already stagnant industry.
As at 31 December 2019, Bestmed exceeded this requirement with a solvency ratio of 35.4% and remained financially stable with a claims ratio of 86.8%. As at 31 December 2020, Bestmed had again exceeded the CMS’ requirement with a solvency ratio of 47.3%. The claims ratio was 76.7%, due to a decline in claims for general and elective procedures.
During 2021, Bestmed experienced an increase in claims, resulting in a higher claims ratio. Leo Dlamini, CEO and PO of Bestmed, states: “The scheme is seeing an increase in the utilisation of funds for general and elective procedures similar to, if not more in certain instances than, that of the preCOVID-19 period. The claims trend that we’ve seen over the last four months is likely to continue, thereby normalising the utilisation of funds.”
AVERAgE AnnuAl InCREASES And BEnEfIt EnhAnCEMEntS
Medical schemes need to consider the cost of COVID-19 over and above general claims, which could have a significant impact on their contributions versus utilisation ratio. If claims begin to exceed contributions, a healthy reserve pool is essential for a scheme to absorb higher claims.
According to the South African Reserve Bank, Bestmed is one of few large schemes that have kept their annual increase below 5%. Bestmed’s average weighted contribution increase for 2022 is 3.9% across all benefit options. The scheme has managed to keep increases low not only because the claims ratio for 2020 was low, but because the scheme already had healthy reserves prior to the COVID-19 pandemic and its administration costs have been managed prudently.
Bestmed has also increased its benefit limits for 2022 more than its contribution increases across all options. Limits and sub-limits were increased by 4.2% across all benefit options. This is the second year in which the benefit limit increase exceeds the average contribution increase for the year.
dIgItAl PlAtfORMS
The medical aid industry has been expected to spearhead innovative solutions to help contain the COVID-19 pandemic and ensure that members have safe access to healthcare providers. Therefore, integrated platforms for video consultations, specialist referrals and paperless scripts have gained traction.
Bestmed was the first medical scheme to partner with a digital healthcare innovator to bring general practitioners (GPs), specialists and healthcare providers a selection of functionalities to maximise service efficiency and enhance patients’ medical outcomes. This unique partnership makes a specialist service provider network available to GPs for easy referrals via iCanRefer. It also provides both GPs and specialists with the iCanScript digital health solution and virtual consultations are available to network doctors via CLICKDOC Video Consultation. Bestmed remains committed to ensuring that healthcare practitioners are equipped with the latest in technology to provide efficient, cost-effective and Personally Yours services to its beneficiaries.
MEntAl hEAlth COnCERnS
According to the South African Depression and Anxiety Group (SADAG), an average of one in 10 people suffers from major depression at some point in life. However, only 25% of those who suffer from depression seek help.
There has been a rise in depression and anxiety during the COVID19 pandemic due to several factors, including isolation, health concerns and economic instability. Medical schemes, such as Bestmed, have taken their beneficiaries’ mental healthcare needs into consideration during this difficult time.
From 2022, approved medicine claims for major depression will continue to be funded from scheme risk once the non-CDL (Chronic Disease List) limit is depleted on the Beat4 and all Pace options.
As South Africans adjust to the ‘new normal’, more mental health issues may arise. Medical schemes should keep abreast of the latest trends in this regard and endeavour to assist their beneficiaries as needed.
leo dlamini
Principal Officer and CEO, Bestmed Medical Scheme
