Medical aid warning for consumers in South Africa

South African consumers often do not understand that medical gap insurance will not always cover every medical aid shortfall.

Speaking in the Ombudsman for Short-Term Insurance’s (OTSI’s) latest report, Zuleckha Cara, Assistant Ombudsman, said that consumers often believe that medical gap insurance will cover any shortfall covered by a comprehensive medical aid cover.

That said, one must remember that gap cover, like any other insurance policy, is subject to terms and conditions and that there are instances where the insurer will not cover the shortfall amount.

An insured submitted a claim to his medical gap cover provider for amounts owned by his medical practitioner following a cardiovascular-related procedure.

The insured said that the insurer must honour the contract as the insurer had advertised that “they will cover the shortfall for the doctor or any procedure”.

“The insurer rejected the claim on the basis that the procedure codes for which the insured was claiming
were excluded from the cover,” said Cara.

“The insurer explained that the procedure codes presented under the claim fell under Prescribed Minimum Benefits (PMBs) and, therefore, the policy excluded the procedure as the comprehensive medical aid policy is supposed to cover these costs in full.”

The insured sought relief by having the insurer pay the shortfall in medical costs, which the medical aid scheme had not paid.

During an investigation into the matter, it was said that the policy initially covered PMBS.

Nevertheless, the policy underwent a review before the claim, and the insured was explicitly alerted that the PMB-related treatment would no longer be covered.

This occurred after an amendment to the regulations of the Medical Schemes Act, requiring that all medical schemes pay the full costs of diagnoses, treatments and care in terms of a defined list of PMBs.

PMBs are defined as “a set of benefits as defined in the Medical Schemes Act 131 of 1998 with Regulations, which ensure all Scheme members have access to certain minimum health benefits, regardless of their Medical Scheme option.”

The office said the insured could not expect the insurer to provide cover beyond what the law permitted, and the complaint was not upheld.

“There are policy exclusions in terms of which the medical gap insurance will not provide cover where the comprehensive medical aid scheme does not pay in full towards a procedure or treatment or where the insured failed to follow the medical scheme’s rules,” said Cara.

“Consumers are warned to discuss their specific needs with their financial service providerstoo find what combination of medical aid and medical gap cover will best meet their needs.”

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