If you belong to a medical scheme, chances are you have received a letter informing you of contribution increases for 2023. If you feel the increase is too high, you have time to switch to a different scheme, but you need to ensure you are comparing apples with apples.

Earlier this year, the Council for Medical Schemes released guidelines advising medical schemes to try to keep contribution increases below inflation, with a cap of 5.7%. But over the past decade, medical scheme contribution increases have outpaced inflation by about 4%.

In an attempt to help members to address the increased cost-of-living crisis, some medical schemes with healthy reserves have opted to implement deferred increases. This means members will only see their 2023 premiums increase from April next year. Both Discovery Health and Momentum Health Solutions have announced deferred contribution increases. While Discovery is hedging its bets and will only announce the quantum of the increase towards the end of February next year, Momentum Health Solutions has announced an average contribution increase of 6.4%.

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Damian McHugh, the executive head of marketing at Momentum Health Solutions, points out that Momentum Medical Scheme has not reduced any benefits to accommodate a lower contribution increase.

Discovery Health’s chief executive, Ryan Noach, says it’s important that the contribution increase accurately reflects underlying price and utilisation changes for 2023. 

“The eventual increase will be in line with medical inflation, which is typically 3% to 4% above the consumer price increase (CPI), though members will experience a real annual increase of between CPI and CPI + 2%, considering the deferral,” he says.

Lee Callakoppen, the principal officer of Bonitas, says the scheme will defer increases until 1 April, with an effective average contribution increase of 4.8%. 

“It’s always a delicate balancing act between keeping increases as low as possible while maintaining the stability of the scheme,” says Callakoppen.  Bonitas has more than R7.4-billion in reserves and signed up more than 190,000 new members over the past three years.  

Bestmed Medical Scheme members will see an average weighted contribution increase of 8.5%, alongside an average weighted benefit limit increase of 5.7%. Leo Dlamini, the principal officer at Bestmed Medical Scheme, says changes for members in 2023 include the cover of mammograms on all options, an increase in child dependants’ age from 21 to 24, and payment of contributions for the first three children only. Bestmed has seen a 3.5% growth in principal members, bringing the total number of beneficiaries under its care to 209,000.

Medihelp Medical Aid has seen more than 5% net growth for the year to date, with 200,000 lives covered. Ettie da Silva, the principal officer at Medihelp, says that during the last quarter of 2021 and the first half of 2022, the scheme witnessed an increase in the cost of care, with utilisation normalising and returning to pre-Covid-19 trends.

“This presents a very different picture to that of the past two years, when reserve build-up brought about by lower utilisation resulted in very low contribution adjustments in the industry.

“South Africa’s annual inflation rate is also running higher than what it has been in years and healthcare inflation is sitting at 3% to 4% above inflation, with new technology, the industry’s ageing population and the increasing cost of care driving it,” she says.

Medihelp will implement a weighted average contribution increase of 7.51% for 2023 and child dependants are covered until the age of 26 on most of its plans. DM168

This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R25.