BizCommunity 29 Nov 2022
Medical aid versus health insurance - where can the average South African get real value for money whilst still having the medical cover they need? Many complain that medical aid cover is prohibitively expensive and that only a small percentage of employed South Africans can afford it. Statistics show that a medical scheme covers only 16.1% of South Africans.
However, the pricing is significantly influenced by the fact that medical schemes are required to provide members with prescribed minimum benefits (PMBs) that cover at least 271 conditions and 26 chronic diseases, whilst health insurers have no obligation to cover PMBs. The costs of the cover are high. But the industry has developed solutions over the years to be more inclusive. Consumers now have options and a way to determine the best value for money for the individual or family.
What makes premiums so high?
For even the most basic plan, the principal member of a medical scheme would pay around R1,500 to R2,000 per month. A single parent with a child could expect to pay at least R2,300 a month. It would require a take-home pay of at least R20,000 a month for the medical cover not to exceed 10% of the household budget. There is however some tax benefit available to members, who are allowed to claim medical tax credits on their tax returns. In the current tax year, taxpayers can claim R347 per month for the first two members and R234 for additional members. The member must submit a tax return to receive their tax credit.
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