Households struggle as medical aid costs outpace inflation

Households face annual pain as medical aid hikes remain well above inflation and lower benefit options offer limited relief. Those fortunate to be able to afford a medical aid each year face the same pain: how much more will I pay? Sharp medical aid hikes every year sadly is the norm, and households are struggling to find the money to keep up. In a Moneyweb story we carried yesterday, the Board of Healthcare Funders (BHF), which represents many medical schemes, has appealed to the Council for Medical Schemes for changes that would allow medical aids to spend less, which leads them to charging less. They argued “households cannot keep absorbing the rising costs of medical scheme increases, or moving to lower benefit options that cost less indefinitely” as hikes are well above consumer price inflation every year. They also ask why, seven years after a health market inquiry recognised the need for a more transparent approach to tariff determination, the necessary reform is still outstanding. BHF managing director Katlego Mothudi said: “We also need reforms that address what schemes pay for health care. One priority is allowing medical schemes to negotiate tariffs collectively with willing providers, under clear regulatory oversight and with transparent pricing. At present, providers have considerable influence over prices, leaving schemes and their members with limited bargaining power.” BHF is calling for prescribed minimum benefits to focus more on “primary health care, prevention, essential medicines and diagnostics” which, in turn, would “create a medical aid package that would be more affordable”. As Momentum Health chief marketing officer Damian McHugh says: “Reform should also encourage prevention and early intervention, rather than focusing only on treatment once someone is seriously ill.” Households are feeling the pinch with the soaring cost of living. Something has to give and it shouldn’t be your right to affordable health care. A rethink is needed.