Medical aid or glorified hospital insurance?
There was a lot of information about medical aids in the weekend press, a lot of it was very critical of the many schemes. While some of it is certainly warranted, what most people dont seem to grasp is that while many of us think that we are members of a medical aid, we are actually just members of glorified hospital insurance schemes. And even then, not all our “in hospital” expenses will be covered by the schemes.
Once we make peace with this fact, we will start to understand what is and what is not covered. We have opted for the plan which is just above the basic plan with Discovery and have been on it for more than 10 years now. We understand that all of our day-to-day medical expenses and even some of our in-hospital expenses will be for our own pockets. Other than that, the scheme covers just about everything (at 200% of medical aid rates) and to be fair to them, when we have claimed, they have paid. So there is no disappointment when they dont pay for things – we knew all along that this was the plan that we had chosen – we dont have a medical aid, we have hospital insurance.
Nor do we make use of their savings plan – I know that there are some advantages to it, especially if you use their network of prescribed doctors. But the kid’s doctor is not part of their scheme and is not likely to be any time soon. So, we put away funds each month into a money market unit trust account to cover those “day-to-day” expenses and I know that we get a much better interest rate on our money in the money market than any medical scheme pays on the savings account. At the end of the day, whether the money comes from the savings account at the medical scheme or from our money market account, it is all money that we have had to pay in and I would rather earn a decent interest rate and have full control over the funds than not know what I am earning and also not be able to use the funds as we want/need.
Perhaps the most interesting bit of information that I picked up was that a family of 4 would need at least R20000 in discretionary funds to pay for their out of hospital expenses – that’s a significant sum of money and certainly puts healthcare out of reach for most people in SA. Clearly there is a need for national health insurance of some sort!