Have you recently joined a medical scheme and are struggling to understand the terminology?
While some terms may seem pretty self-explanatory, there are a few which are bound to leave you completely stumped. You are forgiven, of course, for not understanding what most of the terminology means.
Remember, before you put pen to paper, it is important that your insurance provider has explained to you, word-for-word what the benefits of your health insurance includes and excludes.
It would be disastrous to be struck by an emergency visit to the E.R. only to find you are not covered for any medical procedures that follow.
16 Medical Aid Terms You Think You Know, But Probably Don’t
Let’s start with the easy ones…
1. Principal Member
This is, of course, the main member of the medical aid fund. It can be a single person, or someone who has one or more dependents on their medical scheme.
The principal member will often pay a larger contribution than their dependents do.
What happens if the principal member dies?
If the main member dies, dependants can usually stay in the fund but would have to select a new principal member between them.
2. Open And Closed Funds
An open fund is a medical aid scheme that is open to anyone who wants to join. In simpler terms, it is the medical aid schemes offered by health insurance providers.
A closed fund gets its name from the fact that it is only available to a certain group of people, i.e.: the employees of a specific company are allowed access to the benefits of the scheme. Not all employees will take a grouped medical aid and may opt for their own medical aid in order to enjoy specific benefits appealing to them.
3. Medical Scheme Tariff
The medical scheme tariff is the amount, in Rands, that your insurance provider will pay for certain procedures or consultations. For example, you go to see your specialist and the consultation fee is R750, but your medical aid option only pays R500 for that particular procedure, you will have to pay what is called the ‘co-payment’ or the difference remaining (R250).
4. Waiting Period
While we like to think we are covered in a medical aid scheme as soon as we join, the reality is that you cannot claim for any daily expenses for the first three months.
If, however, you are joining from another medical aid, you may have access to daily expenses claims immediately. The upside is that as soon as your contract comes into effect, you will have access to emergency medical care, should you be involved in an accident or another type of emergency.
5. Prescribed Minimum Benefit (PMB)
According to the Medical Schemes Act, there is a total of 270 conditions for which all members have to be treated. All medical schemes and hospital plans are bound by this law. Hospital cash-back plans and health insurance products are not governed by the act, which means they do not need to include all 270 conditions in their scheme.
6. Day-To-Day Benefits
As mentioned in ‘Waiting Period’, these are out-of-hospital benefits, such as prescribed medication or monthly supplements. Day-to-day benefits differ greatly from scheme to scheme and from option to option. An easy rule of thumb is that the bigger your contribution, generally, the bigger your cover.
Examples of day-to-day benefits:
- GP visits
- Prescription medication
- Dental treatment
- Optometrist visits
To check your benefits, refer to your benefits schedule for your particular healthcare option.
7. Hospital Plan
A hospital plan does not pay for any out-of-hospital consultation or treatment, and only provides cover in the event of your hospitalisation.
This plan is cheaper than a comprehensive plan as it provides less benefits. A hospital plan will, however, pay for chronic medication prescribed for one of the 27 chronic conditions named in the Medical Schemes Act.
8. Medical Savings Account (MSA)
A percentage of your medical contribution (15% to 25%) will be paid into your medical savings account and is for your day-to-day claims.
If you do not use this money in a 12 month period, it will be transferred into your MSA for the following year. If, by chance, you leave your current medical aid, this money will be paid out to you.
9. Chronic Illness Benefit
If you have one of the 27 listed chronic conditions indicated in the Act, your medical aid must pay for this medication on an ongoing basis.
Some medical aids may require you to use a generic form of a specific medication. Once you have registered your chronic condition with your insurance provider, the cost of the medication will not be taken from your MSA, but from your overall limit allowed (as indicated in your policy).
10. Acute Medicine Benefit
An acute medicine benefit provides cover for all once-off prescriptions, such as an antibiotic for the flu or other types of infection. This is because when an infection clears up, you no longer require medication and, as a result, receive medical compensation.
11. Network Doctors / Hospitals / Designated Service Providers
Medical Aid is no different to any other type of insurance and, as a result, a scheme may have agreements with certain doctors, hospitals, or service providers.
A scheme may require its members to use these services if they do not wish to make co-payments at other out-of-network health providers.
If you have been admitted to a hospital for a specific procedure before, you know that, unless it is a medical emergency, you will have to get pre-authorisation from your fund. Failure to do so may result in your health provider refusing to cover the mentioned procedure.
You should obtain your pre-authorisation at least three days before admission by contacting your scheme administrator.
13. Self-Payment Gap
If you have depleted your medical savings account, you will go into what is called the ‘self-payment gap’. This means you will have to finance all day-to-day medical costs yourself.
14. Clinical Protocols
These are considered to be medically appropriate claims for certain conditions and procedures put together by teams of medical professionals. Your cover is subject to the scheme’s rules and funding guidelines.
15. Overall Annual Limit
This is pretty self-explanatory, but refers to a set amount that is covered by your chosen medical aid scheme. The overall annual limit will include a combination of in and out-of-hospital expenses and their limitations. Some schemes may not have a limit.
16. Ex-Gratia Payment
Ex-gratia is Latin for ‘out of goodwill’. This means, if your benefits for certain things have run out, you can put in a request for payment of further treatment. Your request will be carefully considered according to certain guidelines. Your medical aid scheme is not obliged to grant all ex-gratia payment requests.