Depending on the medical scheme option you have chosen - discussed last week - you may, from your own pocket, have to meet certain expenses that are not covered, or are only partially covered, by your scheme. In this instalment in our series on how to manage your money, we tell you how to get the most out of your option.
Many members complain about their medical schemes because they expect their scheme to cover their medical bills in full - particularly those for major expenses. But when the bills come in, they find that, apart from their monthly contribution, they have extra costs to pay.
There may be times when a medical expense is simply not covered by the scheme's benefits, or you have run out of benefits and you have to pay it, or some of it, yourself. But often the reason you face paying out of your own pocket is because you are not well acquainted with the rules of the scheme and how to work within the rules.
Here are a few reasons why you may find a gap in your cover - and a few ways in which you can prevent or minimise those gaps.
Managing PMBs
Every medical scheme has to provide certain benefits known as the prescribed minimum benefits (PMBs). They cover all medical emergencies, about 270 listed conditions which, if left untreated, would have a major impact on the quality of your life, and 27 common chronic conditions.
To manage the costs of providing these benefits to members, schemes are allowed to name particular healthcare providers (such as doctors, pharmacies and hospitals), known as designated service providers. To enjoy the PMB cover you must use these providers (except under exceptional circumstances such as an emergency). Schemes negotiate favourable rates with these providers and in this way can manage the costs of the PMBs.
Check with your doctor whether the condition you have is a PMB. If it is, find out whether the scheme has appointed a designated provider or providers for your condition.
In this way you can ensure that you are covered in full for the treatment you receive for your condition.
Managed care protocols
In order to contain the costs of providing you with benefits, schemes may engage with doctors and decide on the most cost-effective, best-practice treatment or procedure for a particular condition and provide cover for that treatment only.
These decisions are referred to as managed care protocols. These protocols are typically written by doctors for doctors and mean little to the man in the street.
Your doctor should help you find out from the scheme what the scheme's relevant protocols are before he or she embarks on a particular treatment.
Scheme protocols are usually based on what is accepted as the best practice by the association or society representing the relevant medical discipline, and your doctor should be aware of that practice.
If your doctor suggests treatment that differs from this best practice, he or she should tell you as much, Alain Peddle, the head of research and development at Discovery Health, says.
To protect yourself, you should ask your doctor if the treatment represents the standard of care for your condition and what the doctor's experience of typical medical scheme cover for it has been.
Peddle says one of the best ways to determine whether you will have cover for the treatment is to get a "quote letter" from your doctor that outlines the treatment or procedure using the relevant medical codes, known as ICD10 codes. Then call your scheme and ask it to check if all the services listed are covered, he says.
Alternatively, he suggests, your scheme may have a tool on its website to check whether you are covered for a particular healthcare service or not.
Dr James Arens, the clinical operations director of Pro Sano Medical Scheme, says it is not unreasonable to get a second option if you are uneasy about a doctor's treatment plan, particularly for serious or expensive treatments.
Phoning your medical scheme for pre-authorisation for an in-hospital procedure or for chronic medication will also help you to establish what your benefits are and whether the scheme is likely to cover it.
Arens says you should personally make the call to your scheme to get authorisation for hospitalisation - or any other service that requires it - because you will get first-hand information on any disclaimers and exclusions that can result in an out-of-pocket payment.
Medicine lists
As part of their managed care protocols, many schemes have formularies or lists of cost-effective medicines for chronic conditions and even for other prescribed medicines.
Typically, the formulary will list cheaper generic medicines and will exclude newer, more expensive ones that have yet to be proved cost-effective for treating a particular condition.
Before you start a particular course of medication, establish whether your scheme has a formulary. If the medicine is on the scheme's formulary, you are more likely to enjoy full cover. If your doctor prescribes a medicine that is not on the formulary, check with him or her whether you can rather use one that is.
If the doctor has sound medical reasons for prescribing medication not on the formulary, or if you have tried the formulary medicine and it hasn't worked, motivation for alternative treatment should be provided to the scheme and the scheme will be obliged to consider this.
If the scheme's clinical experts and your doctor cannot agree on a suitable treatment that the scheme will cover, you can to take the matter to the Council for Medical Schemes and ask it to rule on the issue.
If you have a chronic condition you may be expected to register on your scheme's disease management programme. The scheme may have such programmes for members with Aids, asthma, cancer, diabetes, heart disease and hypertension.
These programmes are aimed at educating you about the nature of your disease and equipping you to manage it in a way that keeps you as healthy as possible and hence your claims as low as possible.
The rate at which benefits are covered
Different medical schemes and medical scheme options offer cover for healthcare providers at different rates. These rates are based on a list of guideline tariffs published by the Department of Health known as the Reference Price List (RPL).
Some scheme options will pay your medical claims at the RPL rate (100 percent), while others pay up to one-and-a-half times (150 percent), twice (200 percent) or three times (300 percent) the RPL rate or a scheme rate based on the RPL.
Many doctors and other healthcare providers charge more than the RPL rates - sometimes even more than 300 percent of RPL.
Using a doctor or provider who charges more than your scheme pays will result in your having to pay part of the bill out of your own pocket. The exception to this is in the case of an emergency procedure that is a PMB.
If you use doctors who charge rates higher than your scheme pays, especially for specialised in-hospital procedures, the bills can be high.
To avoid this, if you are able to, negotiate the bill with the doctor before he or she treats you. If he or she is not prepared to charge a lower rate, find out whether another doctor will treat you for less.
Arens says you should get into the habit of negotiating discounts with healthcare providers to get the most out of your benefits and, if you are able to, offer to pay in cash in return for a discount and then claim back from your scheme.
Genesis Medical Scheme covers its members at 300 percent of RPL. It says if its members had been on schemes that paid out at 100 percent of RPL, their claims for specialists could have been underpaid as follows:
- Only R24 495 for a birth by caesarean section that cost R32 293, leaving the member with an out-of-pocket payment of R7 798.
- Only R112 714 for treatment following a heart attack, costing R132 813, leaving the member with an out-of-pocket payment of R20 099.
- Only R101 429 of a bill of R143 288 for treating a member for head and back injuries after a motor vehicle accident. The member would have had to pay R41 859.
Provider networks
If you join an option with a network, make sure you use the network providers (hospitals, pharmacies, doctors, and so on) to avoid paying all or part of the bill yourself.
On network options schemes use the collective power of their membership numbers to negotiate tariffs with certain healthcare providers and offer a lower contribution in return for restricting you to those providers. If you use others (except in exceptional circumstances such as in an emergency), you will, however, probably be faced with a payment gap.
Benefit limits and exclusions
Some schemes make use of benefit limits to contain the cost of the benefits you enjoy. It can be difficult to avoid exceeding these limits if your medical needs are high.
However, if the benefit limit is, for example, for visits to an optometrist and glasses, you may be able to avoid exceeding the limit and having to pay out of your own pocket by shopping around for good deals on an eye test and frames.
If the benefit limit is on doctor consultations, for example, and you are likely to need many consultations, you can make the benefit last longer by finding a suitable doctor charging the lowest possible rate.
A medicine benefit limit can be maximised by using cheaper generic medicines. Your doctor or pharmacy should be able to advise you where you can make savings.
If, to contain the cost of your monthly contributions, you choose an option with a limit on benefits lower than what you - or your family - really need, make sure you set aside additional funds in some kind of savings plan. Some scheme administrators offer savings plans for medical expenses.
Watch out for exclusions your scheme may have on cover. For example, it may exclude cover for an organ transplant in a private hospital and offer cover for this only in a state facility.
If you accept such an exclusion in order to keep your contributions affordable, make sure you have the ability to move to a higher option on the same scheme should the need for such a procedure arise. Although your scheme may allow you to upgrade only at the end of year, you will then at least be able to access the appropriate cover. If you try to move to another scheme, you may face a waiting period when you are ill and need cover.
Most schemes will make ex gratia payments to deserving members, Arens says. Ask your scheme for a copy of its ex gratia policy so you know when you can ask for assistance, he says.
Co-payments and levies
Co-payments and levies can also be a source of payments you have to make out of your pocket. The only way to avoid these is to choose an option with no co-payments or levies. However, the reason you have chosen such an option may be to keep your medical scheme contributions affordable.
Schemes impose co-payments on certain procedures or levies on, for example, scripts for medication, to make you consider whether you really need the procedure or the medication.
Co-payments imposed because you did not use your scheme's designated or preferred provider can, however, be avoided.
Regulations relating to managed care protocols
Managed care protocols are usually developed by a managed care entity, which may be separate from, or housed within, the scheme's administrator.
Managed care entities have to obtain accreditation from the Council for Medical Schemes and their actions are governed by regulations under the Medical Schemes Act.
The regulations under the Act state that:
- Managed care activities must themselves be governed by a written protocol that describes the procedures used to evaluate the clinical necessity, appropriateness, efficiency and affordability of a healthcare service;
- Methods used to evaluate decisions must be transparent and based on verifiable criteria;
- Managed care decisions must be reviewed regularly to ensure they are still appropriate;
- There must be a way by which you or your dependants can appeal against a decision made by a managed care entity if you are adversely affected by its decisions;
- Qualified healthcare professionals must administer any managed care programmes and oversee funding decisions;
- If you or your healthcare provider ask for the protocols, your scheme must provide a clear and comprehensive description of any managed care programme and procedure.
- If a scheme develops a managed care protocol for a PMB, that protocol must provide for at least the treatment that is available in a state hospital.
- If your scheme option has a medical savings account, running out of funds can also result in your having to dig deeper into your pocket. Next week we look at making the most of savings accounts.