Here are the facts

One can switch medical schemes at any time during the year, but members could possibly find themselves out of pocket if they have a savings option on their existing medical scheme and the upfront savings have been used.  According to Gavin Griffin, Business Unit Head of Aon Hewitt’s Healthcare Division, this amount will need to be settled by the member when moving to a new medical scheme. 

“It is ideal to make a change in your medical scheme at year-end.  The general risk benefits on a medical scheme are annual benefits, such as having R2 400 per annum for acute medication, as an example.  If you join a new scheme during the year, the benefits are adjusted proportionately (prorated for the remainder of the year),” Gavin explains.

Notice Period
It may be a good idea to read the fine print as far as notice periods are concerned.  “Many medical schemes have a notice period of 30 days, while others may have a longer notice period and in some instances it could even be waived.  The period is normally stipulated in the Scheme Rules and must be complied with,” says Gavin.  “There are normally no penalties or cancellation fees involved if members give due notice, a member is entitled to full benefits during the notice period as contributions are being paid,” he adds.

Waiting Period
A new scheme could impose a general waiting period of up to three months.  During this period contributions are payable without the member being entitled to benefits, which means that general medical expenses will not be covered.  Most people are however not aware of that fact that the Prescribed Minimum Benefits (PMB) - including emergencies - should be covered during this waiting period. No waiting period, restriction, exclusion or co-payment may be applied to any member in respect of PMBs if services are rendered by State Hospitals or the scheme’s Designated Service Providers (DSPs).

There is normally no general waiting period involved if your employer offers more than one medical scheme to its employees, commonly referred to as a split risk arrangement.  “Due to existing underwriting concession there could however be an open enrolment period where these schemes will accept a member’s underwriting with no waiting period attached to it during the first month or two of the New Year and will impose a waiting period thereafter in order to prevent anti-selection, among others,” explains Gavin.

Reasons for a Change
There are many reasons for changing medical schemes:

• Costs – many would opt for a more affordable option
• Benefits – members could either need less or more healthcare benefits
• Exclusions – any exclusion on a benefit could potentially be negotiated better elsewhere
• Accessibility – limits on preferred healthcare practitioners for example could be overly restrictive
• Added value – another medical scheme could offer additional wellness elements
• Service delivery – in the event of a scheme’s service delivery being problematic
• Changing employment – if a member resigns, is retrenched or retires

“Where costs and benefits on a healthcare scheme is a concern, members will often move to another option within the same medical scheme.  By doing so, the member avoids any waiting periods and it provides the member with an opportunity to either buy-up within the scheme to acquire better benefits or to buy-down with the purpose of securing lower contributions, most schemes only allow buy-up at the beginning of a benefit period, but would allow buy-down during the year,” explains Gavin.

“If a member however opts to buy down, I would strongly recommend that the member’s current benefit needs are comprehensively reviewed in order to ensure that buying down will not leave the member out of pocket when claiming or without benefits that cannot be self-funded,” warns Gavin.

Advice
In order to make an informed decision regarding a medical scheme, options within a medical scheme or a new scheme, it is best to consult a healthcare intermediary.  “A broker should provide you with best advice to switch options or medical scheme, taking into account your current healthcare needs and financial position by comparing benefits and contributions within a member’s existing scheme with options within other open medical schemes,” concludes Gavin.

The council for medical schemes website http://www.medicalschemes.com/  have a list of all accredited medical scheme brokers.