Best and worst major medical aids in South Africa

 ·1 Nov 2020

Consulta has published its latest South African Customer Satisfaction Index (SAcsi) for the local medical aid industry, showing which of the largest medical schemes are keeping their customers happy.

The global Covid-19 pandemic which hit in 2020 thrust medical care into the spotlight for many, and showed that there is a great need for medical coverage, Consulta said.

However, while consumers recognise the need for private healthcare – given the parlous state of public health facilities – they are still at a crossroads as to whether the price paid for medical scheme membership justifies the value and quality received.

“Much of this hinges on the utilisation experience of each member,” it said.

The 2020 SAcsi for medical schemes surveyed the overall satisfaction of members of South Africa’s largest open medical scheme providers – Bestmed, Bonitas, Discovery, Medihelp, and Momentum.

The survey also included GEMS, which is the only closed medical scheme included in the survey, because of its significant membership among government employees. Consulta polled 1,826 medical scheme members across the schemes.

The trends observed in the SAcsi over the last five years points to a distinct skew in the satisfaction of members who make use of their medical scheme benefits for one-off, sizeable medical event expenses such as hospitalisation or chronic healthcare needs, versus those that primarily use the scheme benefits to fund day-to-day claims such as GP visits, optometry, and dentistry, Consulta said.

“The co-payments on day-to-day benefits represent out-of-pocket expenses that, within a pressured consumer budget, detract significantly from the utility value of medical schemes,” said Ineke Prinsloo, Head of Customer Insights at Consulta.

In light of Covid-19, Consulta said its ongoing Covid tracking studies indicated that consumers are looking towards cutting back on expenses and discretionary spending as a result of the pressure on household budgets.

“With concerns about health care right up there with the economy’s state and the ability to earn an income, consumers are reluctant to cut their medical scheme contributions,” it said.

“Combined with an expectation that there will be a substantial increase in healthcare expenses and spend on medicines, consumers’ expectations of the value of every rand spent on medical scheme contributions are increasing.”

Best medical schemes

The latest SAcsi shows that many members feel trapped and stay with their current provider not out of loyalty, but because they don’t see any viable alternative, Consulta said.

“Given that medical scheme cover can cost 20% or more of monthly disposable household income, and average hyper-inflationary annual increases of 8-10% amidst a jobs bloodbath, it is critical for medical schemes to focus on the customer experience and satisfaction of all members, but especially healthier members who claim less.

“It is vital to get benefit communications and customer experience on point,” it said.

Because Consulta conducted this year’s SAcsi for Medical Schemes after the arrival of Covid-19 and national lockdown, the trajectory has changed somewhat from last year’s survey.

“Given the public healthcare system’s disastrous state, private healthcare is viewed as crucial and something that customers do not want to live without, albeit very expensive.

“The complexity of medical scheme benefits also adds tremendously to the challenge of how medical schemes demonstrate value to a consumer who does not fully grasp the regulatory environment that schemes operate within.

“This is amplified in consumers with lower or minimal utilisation who feel aggrieved at ‘paying the same as everyone else regardless of usage,” the group said.

Similar to the trends observed in the 2019 report, no outright leader was identified in this year’s index. Bestmed (77.4), Medihelp (77.1), Discovery (76.8), and Bonitas (74.9) come in on industry par (76.1) on overall customer satisfaction scores.

Discovery, GEMS, Medihelp, and Momentum all show improved overall customer satisfaction scores compared with 2019. Discovery is the only brand that has shown small but consistent customer satisfaction scores over three years.

GEMS and Momentum are below par (both on 71.1).

Customer Loyalty

  • Bestmed has the most loyal customers at 70.6%, above industry par of 68.8%, followed by Medihelp at 70.4%.
  • Discovery (69.9%) and Bonitas (68.2%) are on par, while Gems (60%) and Momentum (59.5%) have the least loyal customers, with Momentum showing a 4% decline in customer loyalty scores from 2019.

Price changes

October traditionally is the month for schemes to announce updated rates for the new year.

For the first time, the market has not seen the perfunctory across-the-board above inflation rate increases that has been the norm.

The Council for Medical Schemes called upon schemes to cap annual increases at 3.9%, with consumers facing an unprecedented affordability challenge. The major open schemes had different approaches to heed the call, with Momentum the only one to keep to the 3.9% recommendation.

This year, there seem to be tangible financial relief for consumers and not, as has been the trend, more options for different affordability categories that have proven counterproductive on perceptions of value for money in the category from results of the index.

Perceived value is a measure of the quality relative to the price paid. The perception of value for money is a robust predictor of future usage and company growth.

Bestmed (78.0) takes the lead by a significant margin on the industry par of 72.2 and well ahead of all other schemes in terms of the value index. Medihelp also takes a leader position on Perceived Value with 74.7.

Bonitas (73.9) and Discovery (71.4) perform on par, while GEMS (69.4) and Momentum (69.7) are below par.

Momentum has remained on a three-year decline in this indicator. All other schemes have shown some improvement in 2019 scores.

Read: South Africa pushes ahead with NHI – expects next milestone in February 2021

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