As medical schemes announce their benefit changes and premium increases for 2022, the findings of a survey suggest that a significant number of members will move to lower-cost options or change medical schemes. The survey found that overall customer satisfaction with South Africa’s largest medical schemes declined sharply this year, with some recording their lowest customer loyalty scores in six years.
The South African Customer Satisfaction Index (SA-csi) for Medical Schemes, conducted by Consulta, provides insights into the overall satisfaction of members of the country’s largest (by membership) open medical schemes: Bestmed, Bonitas, Discovery, Medihelp and Momentum Health. GEMS is the only closed scheme included in the survey.
Consulta polled 1 950 medical scheme members during the first half of 2021.
Bestmed was the leader on overall customer satisfaction.
The customer satisfaction scores of all schemes declined compared with 2020.
“With customer satisfaction levels and loyalty scores at one of their lowest points in years, and with consumer price tolerance at equally low levels, there’s likely to be significant shifts of members to lower cost-benefit plans and between medical schemes as customers try to balance value, quality, necessity and affordability,” said Ineke Prinsloo, the head of customer insights at Consulta.
According to the survey, the gap between what members expect from their medical scheme and what they perceive to receive has widened since 2019. This consistently increasing gap has finally resulted in lower customer expectations.
“Lower expectations should not be misinterpreted as a positive outcome, as a decline in this metric is typically the driver of drops in all other metrics of customer satisfaction, including overall quality (perceived by the customer), meeting their needs and reliability,” said Prinsloo.
She said the drop in expectations could be a precursor to more significant numbers of people opting out entirely or downgrading their benefits to basic core plans in the coming months, as they don’t perceive their current use to be meeting their requirements or reliable in their time of need. “There is a definite disjoin between quality and value versus price paid.”
“The latest index shows that the healthy and younger members with lower or even minimal benefit utilisation are least satisfied and loyal. Without focused intervention from medical schemes to address the drivers of customer satisfaction in this key demographic, medical schemes will soon find that the pool of funds to subsidise older, less healthy, higher utilisation members is shrinking, bringing the sustainability of the entire private healthcare funding model into question,” according to Prinsloo.
Members feel they are paying too much for a benefit that isn’t effectively tailored to their needs. “This is driven by the fact that many members do not understand the specific scope of the cover in their benefit plan, which translates into a sentiment that medical schemes are not keeping their promises,” the survey found.
Consulta said the findings made it “very clear” that providing more options for different affordability categories “has proved counterproductive on perceptions of value for money and quality, which have a direct impact on loyalty and overall satisfaction scores among medical scheme members”.
Rise in complaints
Except for Bestmed, all the schemes have consistently recorded a rise in complaints over the past five years, the survey found. Discovery, GEMS and Momentum experienced significant increases in complaint incidence during 2021.
It said this negative trend had been compounded by “highly inconsistent complaint handling”.
The 2021 complaints incidence par score for the industry was 20.8%, whereas the international best practice score was below 10%.
The most prevalent complaints related to slow pay-outs, declined benefits or total non-payment.
Key take-outs from the 2021 SA-csi for medical schemes:
Customer satisfaction – overall index
- Bestmed, 76.7; Bonitas, 73.7; Discovery, 73.7 – all above the industry par of 73.5
- Medihelp, 72.3; Momentum, 69.9; GEMS, 69.4
- The least satisfied customers remain those with low to minimal benefit utilisation and who face co-payments and out-of-pocket expenses on day-to-day primary healthcare needs and chronic medication.
- Members on network plans (71) and hospital plans (72.5) are less satisfied than those on comprehensive plans (75.5).
Customer expectations and perceived quality
- The par score for customer expectations decreased to 82.2 from 85 in 2020.
- Perceived quality declined to 79.4 from 83 in 2020 – its lowest in five years.
- Bestmed had the lowest expectation-quality gap of -0.5 compared with the par of -2.8.
- Momentum, -1.3; GEMS, -1.3; Medihelp, -1.7; Bonitas, -2.2; Discovery, -3.4
Perceived value
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,” according to the survey.
- Bestmed, 74.1; Bonitas, 71.1; Medihelp, 70.6 – all above the industry par of 70.5
- Discovery, 70.5; GEMS, 69; Momentum, 67
- All schemes declined on this score compared with 2020, with Medihelp showing the largest decline of more than four index points.
Complaint incidence and handling
- Complaint incidence: Bestmed, 11.6%; Medihelp, 14.6%; Discovery, 21%; Bonitas, 22.3%; GEMS, 25.1%; Momentum Health, 26.1%
- Complaint-handling score: Momentum Health, 53.6; Bestmed, 47.6; GEMS, 45.8; Medihelp, 45.8 (all above the industry par of 43.7); Bonitas, 42.6; Discovery, 42.3
Customer loyalty
- Bestmed, 68.9% (2020: 70.6%); Discovery, 66.4% (2020: 69.9%) – both above the industry par of 65.7%
- Medihelp, 64.8%; Bonitas, 64.3%; Momentum, 61.6%; GEMS, 61.1%
Net promoter score (NPS)
The NPS score measures the likelihood of a member recommending a brand.
- The par score of 11.8% was a significant decline from its high of 22.1% in 2020.
- Bestmed, 28.5%; and 52% of its members recommend the brand. Bestmed has the lowest number of detractors at 24%.
- Bonitas, 20.2%; and 47% of members endorse the brand.
- Medihelp, 11% (2020: 21.4%); 40% of members promote the brand, 29% are detractors.
- Discovery, 9.7% (2020: 21.4%), its lowest NPS score in the past five years; 40% of members actively promote the brand, 30% are detractors.
- Momentum, 1.2% (2020: 13.3%); 35% of members are detractors.
- GEMS, -9.2%; and 41% of members are detractors.
Treating Customers Fairly (TCF)
- Bestmed, 80.6; Bonitas, 79.3 – both above the industry par of 76.4
- Medihelp, 76.4; Discovery, 75.9; GEMS, 74; Momentum, 72.4
- The TCF scores of all medical schemes declined compared with 2020.
