Medical Schemes Amendment Bill – How it might impact premiums
Under the heading, Bill ups medical scheme costs for over-34s, Legalbrief Today recently reported as follows:
“Medical scheme premiums may increase by more than 15% for those over 34 years of age if the government pushes through with the Medical Schemes Amendment Bill, actuaries warn. According to Rapport, Insight Actuaries raises this in its representations to the Department of Health. Public comments on the Bill closed recently. Health Minister Aaron Motsoaledi announced the Bill in June, saying it intended to bring ‘immediate relief’ for the public while NHI plans were under way.”
Insight says the Bill would have the opposite effect for the majority of members as the Bill caps premiums for children at 20% of adult premiums and at 40% for ‘young adults’ aged 18 to 34. Based on Insight’s calculations, it estimates that the adult rate would have to be raised by at least 15% to put schemes in the same position.
Discovery Health also filed sceptical submissions, the report notes. Discovery’s Jonathan Broomberg says the Minister announced a scrapping of co-payments, but that this is not contained in the Bill. Instead, the Bill just abolishes co-payments on the so-called ‘comprehensive service benefits’ which is apparently a renaming of the current ‘prescribed minimum benefits’. The position on co-payments would therefore remain the same, Broomberg says.”
There is a decline in young people joining medical aid schemes. The authorities want to reverse this trend, but loading the premiums of older people whose income and earning capacity decrease after retirement is surely not the way to do it?
Click here to read the article as published on the MyBroadband website.