Executive summary

In 2019, there were five medical aid funds in Botswana registered with the NBFIRA, the same as in 2018.

Of the five medical aid funds registered with the Non-Banking Financial Institutions Regulatory Authority (NBFIRA) in Botswana, four are members of the Board of Healthcare Funders (BHF) and submitted data for the preparation of this report. These four funds represent approximately 95% of the lives covered by medical aid funds in Botswana.

There were 327 500 beneficiaries covered by these resenting an increase of 5.8%. The average family size in 2019 was 2.32. The average age of beneficiaries increased slightly from 29.43 in 2018 to 29.52 in 2019, while the pensioner ratio increased marginally from 2.68% in 2018 to 2.89% in 2019.

Across the four funds, there were 30 benefit options in 2018 and 29 benefit options in 2019. The average number of options was therefore 7.25 in 2019. The average option size (by number of beneficiaries) increased four funds in 2019, up from 309 500 in 2018 – rep

by 9.5% from 10 317 in 2018 to 11 293 in 2019.

The funds received gross contributions of P1.92 billion in 2019, up from P1.76 billion in 2018, an increase of

Benefic iar ies (of the four funds)

5.8% 327 500 (2019) 309 500 (2018)

GROSS CONT RIBUTI ONS

9.2% P1.92bn (2019) P1.76bn (2018)

GROSS expenditur e

9.4% P1.64bn (2019) P1.50bn (2018)

average option size 2019: 11 293 2018: 10 317

average monthly contribution 2019: P490 2018: P475

9.2% year on year. Gross healthcare expenditure increased by 9.4%, from P1.50 billion in 2018 to P1.64 billion in 2019. The reserves of these funds, calculated as a proportion of gross annual contributions, grew from 50.6% in 2018 to 51.6%% in 2019.

The average contribution per beneficiary per month (pbpm) was P490 in 2019 while in 2018 it was P475, increasing by 3.2% from 2018 to 2019. Annual inflation as measured by the consumer price index increased by 2.85%; contribution increases were therefore 0.35% higher compared to inflation. Affordability of medical aid fund cover is important as it improves long-term sustainability.

Healthcare expenditure by medical aid funds in 2019 was P418 pbpm, representing 85% of the gross contributions received in 2019. Non-healthcare expenditure accounted for 11.0% of gross contributions in 2019. In 2018, non-healthcare expenditure represented 13.2% of gross contributions. Non-healthcare expenditure declined in monetary terms from P63 pbpm to P54 pbpm from 2018 to 2019. This makes available more financial resources for healthcare expenditure and contributes towards affordability.

In 2019, claims submitted to medical aid funds amounted to P2.02 billion while P1.61 billion was paid in respect of these claims. Out-of-Pocket (OOP) expenditure by beneficiaries was at least P403 million. This OOP expenditure represented approximately 20% of total healthcare expenditure in 2019, higher than the WHO’s recommended limit of 15%.

Cha rlt on Murove BHF Research: Head