As major medical schemes announce average contribution hikes surpassing 9% for 2025, cash-strapped members are grappling with challenging choices in a healthcare landscape that is becoming increasingly unaffordable. Should they downgrade to a more economical plan, or is it time to explore other medical schemes?
Among South Africa’s five largest open medical schemes, Discovery Health Medical Scheme (DHMS) announced a weighted average increase of 9.3%, Momentum 9.4%, Bonitas 10.2%, Medihelp 10.8%, and Bestmed 12.75% for 2025.
Momentum Health Solutions underscores the importance of consumer knowledge in making informed choices about medical cover and benefits. Damian McHugh, the chief marketing officer of Momentum Health Solutions, acknowledges the financial strain these increases may impose. However, he warns that while downgrading to a lower plan might appear to be a cost-saving strategy, it often results in reduced benefits and higher out-of-pocket expenses.
McHugh further emphasises the importance of preventative care, stating: “Investing in a plan with strong preventive care benefits can lead to long-term savings. Regular check-ups, screenings, and vaccinations help detect and prevent serious health issues early, reducing the need for costly treatments down the line.”
McHugh also advises making the most of preventative care services, wellness programmes, and discounts on health-related products and services. “These can help offset the cost of higher contributions,” he adds.
Proactive planning – calling in the professionals
To help consumers manage increased contributions effectively, Momentum Health Solutions encourages proactive planning. “Reviewing your healthcare plan annually is crucial,” says McHugh. “Assess your healthcare needs and compare them with your current plan’s benefits. This ensures that you aren’t paying for services you don’t need while still receiving adequate cover.”
He encourages members to stay informed about changes in the healthcare industry and how these changes may impact their cover.
“Your health adviser will provide regular updates and resources to help you make informed decisions about your healthcare. It’s essential to discuss your health requirements with your adviser to select the best possible benefits tailored to your needs.”
Medshield medical scheme also recommends that members seek the advice and guidance of a financial adviser when understanding the benefits of their options. This includes considerations such as the Prescribed Minimum Benefits (PMBs), chronic medication, and the medicine formulary (approved drugs), as well as dental and optical benefits, and hospitalisation.
“Changing to a lower benefit option will result in lesser benefits entitlement, and there may be a significant impact on how your chronic medication will be covered as opposed to the formularies used by your previous option. It could lead to more out-of-pocket expenses due to certain medicine/s not being covered on your new option. Certain benefit limits on specific options only cover PMBs, meaning that non-PMB conditions and procedures will not be covered,” Medshield states.
Members also need to ensure that the change they make is affordable. “Make sure you are making the switch that will benefit you in the long term. If you simply want to pay less, you might compromise your cover only to realise your mistake at the claim stage. So, ensure you have enough cover and understand how the potential benefit option works.”
Network providers – pros and cons
Something else members need to consider, says Medshield, is network providers. Network options typically offer the same benefits, but within a defined network of healthcare facilities and healthcare professionals. Network options offer a discounted contribution based on the network efficiencies.
Medshield notes it is essential to consider the choice of network providers, because specific benefit options allow members to choose freely, while other options are network-restricted.
“Most people on medical aid already have their preferred doctor and hospital, and switching benefit options – especially an option with a lower premium – might mean losing access to your preferred healthcare provider,” Medshield states.
Don’t sell yourself short
Weighing in on the factors to consider when contemplating an alternative medical scheme or a change of plan to save on costs, DHMS emphasises that the most critical consideration is the medical needs of the member and their family.
“Although a plan downgrade may save the member monthly contributions, the additional out-of-pocket expenses to continue to meet the medical needs of the family must be considered as well.”
DHMS cautions that members who decide to downgrade their plan must be fully aware of the impact it will have on their future healthcare coverage. “This may include lower levels of day-to-day healthcare services, or lower levels of cover for major medical expenses like cancer and medical emergencies. Members should make alternative provision for the financial impact this may have.”
Additionally, DHMS advises that members moving to a plan with lower levels of cover for day-to-day healthcare services based on their current health must be aware of the implications for their cover for major medical expenses, including cancer.
“Although they may save in contributions, they may compromise themselves when it comes to the cover for really expensive medical events that are not really related to their current levels of health.”
DHMS also emphasises that financial advice is critical for this decision. “It may be possible to maintain the same plan choice by allowing an accredited financial planner to reconsider the cost of the member’s entire financial planning portfolio, including life and disability insurance, and not just the healthcare component of that.”
Waiting periods
Members who switch to a new scheme may face waiting periods with the new provider, determined by their previous medical scheme membership duration and their responses to underwriting questions.
The Medical Schemes Act authorises two types of waiting periods: a general waiting period of up to three months, and a condition-specific waiting period lasting up to 12 months. These waiting periods may apply if a member is transitioning from one scheme to another, has never been a medical scheme member, or has not been a scheme member for at least 90 days.
Although members can generally downgrade their plan within their current medical scheme at any time, some schemes restrict this option to November and December. Members are permitted to upgrade their plan once a year during November and December,
What to consider when changing medical schemes
The Council for Medical Schemes (CMS) offers these tips:
- Read the material schemes send on the important changes to benefit options for next year.
- If you are unsure, call the scheme to explain any changes, limits, benefits, and other relevant information.
- Elect an option according to your healthcare needs and what you can afford.
- You may make use of an agent or broker (intermediary). Remember it is not compulsory to use a broker, but if you do, ensure that he or she has been accredited by the CMS and that your selection of a scheme and benefit option is based on informed consent.
- Medical schemes may appoint preferred/network providers that have contracts with the scheme to provide services. The medical scheme’s rules will determine how preferred/network providers are funded. It is as such important that you know the rules and study the benefit guide in detail. It is also necessary to contact your medical scheme to find out who the preferred provider is before you make appointments.
- Determine how close Designated Service Providers (DSPs) are to your home and/or place of work, as well as what co-payments are applicable for the voluntary use of non-DSPs.
- No restrictions, co-payments, waiting periods, or exclusions may be applied to any person in respect of the PMBs if the services are obtained from DSPs. Where services are voluntarily obtained from a non-DSP, co-payments may apply.
- Note that pre-authorisation, formularies, and protocols may also be used by a medical scheme to ensure that healthcare is cost-effective and affordable.
