Bonitas Medical Fund - #1 Company In The Medical Aid Schemes Sector

Interview with Lee Callakoppen and Luke Woodhouse

Lee Callakoppen, Principal Officer at Bonitas

Congratulations on being number 1 in your sector. What do you think sets Bonitas apart from the competition?

There are a number of factors we feel set us apart, including having a member-centric approach to everything we do. As the ‘Medical Aid for South Africa,’ we have a wide and diverse membership and strive to keep abreast of their healthcare needs through extensive research and data analytics. This includes all stakeholders but specifically members, employers and healthcare providers.

We have strong corporate governance and leadership from our Board of Trustees. Decisions made always have members at the forefront, with a focus on providing quality healthcare at affordable pricing structures.

We take great care to balance our benefit enhancements to provide value to our members, while still ensuring that contributions remain affordable. This was demonstrated by the Scheme announcing the lowest increases for large open medical aid schemes for 2024. This amounted to an average weighted increase of 6.9%.

Networks

We know that consumers face economic pressures so we engaged and collaborated with healthcare providers to find solutions. We implemented networks at the most favourable tariffs for our members so that they can avoid out-of-pocket expenses and get more value from their medical aid. This applies to GPs, medication, dentistry, optical, specialists and hospitals. Not only do we direct members to the most efficient hospitals, with the best healthcare options but the discounted tariffs reduce co-payments or eliminate them.

Introducing the Bonitas Be Better Benefit!

Funded completely from risk, this unique benefit provides a range of tests and benefits to ensure members have access to the necessary screenings, to allow for early detection and to be put onto a path to wellness.

Benefit Booster

It is the only benefit in the healthcare industry that provides members access to additional funds to use for out-of-hospital expenses. It has been boosted significantly for 2024 and is available after completing an online wellness questionnaire or a wellness screening.

Mental Health

Mental health prevalence is at an all-time high. This is exacerbated by factors such as an increased economic burden and increased psycho-social challenges, such as loadshedding.

We have seen a 25% increase in the number of mental health hospital admissions, indicating a need for additional support. For this reason, we have included the Bonitas Mental Health Programme across all plans for 2024 and included depression as a chronic condition.

We also offer access to Panda, a digital platform available through the Bonitas app, giving members easy access to expert help, mental health information and community support.

Please describe Bonitas’ membership, products, services

Our members are from all walks of life – they are go-getting entrepreneurs, SMMEs, Chief Executive Officers, newlyweds, young couples with children, retirees and minimum wage earners. South Africans who need peace of mind when it comes to healthcare. Which is why we offer a wide range of plans, 15 in total, grouped in five categories: Savings, traditional, hospital, Edge (virtual) and income-based.

We have tried to keep things simple and easy to understand, with plans structured to meet a diverse range of quality healthcare options that are easier on the pocket. To this end, we introduced Efficiency Discounted Options (EDOs) – plans that use network healthcare providers - this means members pay around 15% less for the same benefits. EDOs currently cover over 70 000 lives.

Our Edge plans are aimed at new entrants to the workplace, economically active singles or couples, living in the larger metros, aged between 18 and 35. The plans are driven by technology and ease of access through virtual integration and digital intervention. We also have strong networks with the best providers and a host of supplementary benefits, paid from risk.

The Care programmes include cover for chronic conditions such as cancer, diabetes, HIV/AIDS, back and neck problems and mental health.

Bonitas has been operational for over 4 decades. Please tell us about some of the biggest changes the company has experienced

For just over four decades, Bonitas has been providing affordable, quality healthcare to South Africans and is now the second largest open medical scheme in the country.

Our mantra ‘The Medical Aid for South Africa’ underpins all we do including finding innovative solutions to help reduce the cost of private healthcare, without compromising on quality. We put our members first when we negotiate rates and source reputable service providers. We do not believe in ‘one-size-fits-all’ and adjust our wide range of benefit options annually, while keeping plans simple and user-friendly.

Our core focus is to ensure that we act in our members best interests at all times. It’s multi-faceted and covers various aspects including creating value via an outcome-based healthcare model, as well as partnering with healthcare providers to improve clinical outcomes.

We therefore, play a more critical role as a healthcare partner to our members on their journey to wellness. The biggest challenge over the past 40+ years has been the rising costs of healthcare and the increase in disease burden, especially lifestyle diseases.

We have a responsibility to be proactive in terms of guiding members towards living a healthier lifestyle. In order to do this, we need to take cognisance of all socio-economic factors impacting South Africans –such as poverty, unemployment, mental health and gender-based violence are impacted by healthcare and must therefore be considered within the broader value chain.

We see the future of healthcare revolving around preventative care and sustaining well-being, as opposed to responding to illness.

Luke Woodhouse, Chief Financial Officer

What have been some of your most memorable milestones as CFO?

In the past few years, the Scheme has been successful in winning various industry awards for being best in class in the medical scheme sector. However, I believe that our success story is largely due to a number of small steps being taken by the collective on a day-today basis. What I am most proud of is how the Scheme has managed to deliver consistent growth and financial sustainability without compromising on affordability.

Bonitas grew its reserves and solvency from R4.3-billion and 24.9% in 2019 to R8.8-billion and 41.3% in 2022. This performance was not compromised by high premium increases. In fact, over the past three years Bonitas effected premium increases in total of 16.9% versus the industry average of 21%. Over the same timeframe the Scheme grew from 338 751 principal members in 2019 to 353 763 in 2022, which included a successful amalgamation with the Nedgroup Medical Aid Scheme.

Bonitas also achieved a value for money score of R1.78 for every R1 spent on admin and managed care in 2021 which was calculated by Deloitte. This score far exceeded the industry proxy of R1.59. This means that members who join Bonitas can be confident that their contribution goes further than with any other medical scheme.

In your opinion how has the Medical Aid sector landscape changed over the last 5 years?

COVID-19 has accelerated a number of trends that were taking place within the medical aid sector. Work from home policies have now become commonplace and employers have become better equipped to deal with some of their workforce working from home. Furthermore, employers are now acutely aware of the impact of workforce health on the productivity of their organisation. For this reason, employers must partner with medical schemes to improve healthcare outcomes of their employees.

However, we have also seen an increasing disease burden since the onset of COVID-19. This includes an increase in mental health and other noncommunicable diseases, such as hypertension and diabetes. Medical schemes need to enhance their disease management programmes and introduce better preventative measures to reduce the onset of disease and improve outcomes.

We also cannot ignore the significant macroeconomic challenges that are plaguing everyday South Africans. The increasing unemployment rate and reduction in household income, due to high bank lending rates, is creating significant barriers for South Africans to enter and remain in the private health sector. Members are being forced to buy down into lower cost options or to give up their medical aid all together. For this reason, medical schemes must remain affordable and innovative in their product design to promote access.

On a positive note, COVID-19 encouraged the public and private sector, to work together to deliver healthcare to all South Africans. Bonitas believes that this is a step in the right direction towards achieving universal healthcare. A mutually beneficial partnership between the public and private health sector is the key to delivering a successful universal health programme.

What are you excited about in the coming year?

At our 2024 Product Launch held in late September, we highlighted a large number of exciting benefit enhancements that have created a real buzz in the market – these include: Chronic cover for depression and access to our mental healthcare programme, which I’m sure will give our members the support they need – particularly with the high prevalence of depression and anxiety in South Africa.

Our proposed weighted average increase of 6.9% for 2024 is also the lowest of all the large open medical schemes. I am confident that the Bonitas product lineup for 2024 is unparalleled.

Please note: Contributions and benefits subject to approval by the Council for Medical Schemes.