Dear Valued Client
As we hit 190 days of lockdown, we have reached that time of the year when medical schemes announce their product enhancements and premium increases for the new year. This year the actuaries and product development teams have certainly had their work cut out for them!
At the peak of the COVID-19 Pandemic, most medical schemes would have had about 20% of their COVID-19 positive members being hospitalised, with an average of about 7 days in hospital. As an indication of cost, a patient on ventilation would incur about R250 000 in hospitalisation expenses!
Although these “unusual” costs seem high, many elective procedures have been delayed, so whilst hospitalisation costs may end up being relatively low for 2020, delayed treatment and a possible second COVID-19 wave will “balloon” costs in the new year.
Another consideration is that CPI and tariff increases will be lower at about 3.5%, and with the Council for Medical Schemes sending out a directive that premium increases should not be more than 3.9%, many medical schemes may battle to achieve this. Medical scheme increases have historically been between 2% & 3% above CPI. We have already seen some increases ranging from 3.9% – 5.9%.
Discovery Health launched an industry first this week by announcing a “Premium Freeze” for the first 6 months of 2021!
They will carefully monitor claims and have undertaken to announce an increase no higher than 5.9% effective 1 July 2021.Whilst there are no major changes to the current options, Discovery has taken cognisance of the “new normal” and launched Discovery Connected Care which focuses on an elevated level of home treatment, virtual consultations, online coaches and home nurses. Mental Wellbeing is now a great focus area and we will see Personal Health Goals added to our Active Rewards. Fertility treatment is finally available on top plans with the usual t’s and c’s!
Vitality has been enhanced with some nice new partners such as Nespresso, Makro, Game, Builders Warehouse, Travelstart and a lot more! Discovery has finally expanded beyond gym visits to reward us for keeping fit. Yoga, Pilates, dance and “digital fitness” are now recognised! Purchasing a fitness device is now even more affordable as well. In line with Discovery’s integration strategy, it is now even more attractive to make Discovery Bank your card of choice.
We really would like to help you maximise the benefit of integrating and look forward to your request for a personal consultation with us.
Gap cover is now well entrenched, and as the various companies announce their changes for 2021 during the month of October, we will be evaluating your current cover to ensure you are optimally covered going forward. Should we deem a change to be prudent, we will be in touch with you. You will receive correspondence from Discovery Health later this month. Please feel free to contact us should you wish to discuss an option change for 2020.
Mark O’ Flaherty