By Liana Shaw
Amid a global pandemic, and with most countries around the world in lockdown, including South Africa, the country’s top medical aid provider, Discovery Health, appears in no rush to assist its loyal member base by way of providing any payment relief.
As the owner of a small manufacturing concern, the lockdown effectively means that no income will be coming in over the month of April, making it virtually impossible for me, (and I’m sure, many other South Africans), to meet their financial commitments.
Short of defaulting on my monthly debit order with Discovery Health, (incidentally, I have never defaulted on payment in more than 20 years since first signing up), I placed a call earlier today, only to be advised that the only ‘assistance’ Discovery is willing to provide would be in the form of any left-over medical savings from 2019! Really? Are there members on their Classic Comprehensive Package with any remaining medical savings? Most folk I know typically run out of their medical savings quota by the second or third quarter of the year. So, is there no way you can provide some payment relief I ask, even by way of slashing 30% or so off the monthly premium? The definitive answer is, no.
One could argue that this is the ideal time for a medical aid services provider to profit from the situation. After all, we know the worst is still to come. There is no cure for this virus. Sadly, many will need to be hospitalised and intubated if they are to have any hope of survival. And of course, hospitalisation, (especially should you be the unfortunate case that lands up in the Intensive Care Unit), is expensive. Given the neglected state of our public hospitals, those of us who are able to fork out for private health care, do so, but often at great financial sacrifice.
So, what happens if the debit order defaults at month end, I ask. Simple, your membership is immediately suspended. Just like that.
Which begs the question, should not a giant health care insurer like Discovery, be doing everything in its power to assist its members in exchange for their loyal support over the years?
So many companies across South Africa and beyond are coming to the party at this critical time, donating cash, food, health and safety products and so much more. Should a leading concern like Discovery Health not be doing the same?
Once this pandemic has run its course, and we can start rebuilding the economy and our businesses (should they be fortunate enough to survive the onslaught), I, for one, will be seriously re-evaluating where I invest my hard-earned money and with which service providers. For me, their response to the coronavirus, or lack thereof, will be the ultimate differentiator.
*In the interests of fair journalism, the story was sent to Adrian Gore, Group Chief Executive for Discovery for comment. We received the following:
Thank you for the opportunity to respond and provide clarity.
We are deeply sympathetic to the situation many of our clients are in.
Although the Discovery Health Medical Scheme is in a financially sound position as a result of many years of responsible management to maintain statutory solvency levels, the Scheme must prioritise the use of its reserves for additional expected claims related to COVID-19 and to ensure its future sustainability. The Scheme recognises that many of its members are facing unfortunate financial constraints and are potentially distressed as a result of the COVID-19 pandemic, the national lockdown and consequent business interruption. This could impact their ability to pay medical scheme contributions in the coming months.
In light of this, we have made it possible for members who are on health plans that have a Medical Savings Account (MSA) with a sufficient balance, to use their positive balance to pay for their total medical scheme contribution for up to three months. Members can apply to access this option if they have a positive MSA balance equivalent to at least one month’s medical scheme contribution from their MSA balance. This will provide support to over 200 000 of our members, however we are conscious that this does not provide support to every single one of our members.
Unfortunately, the Scheme is not in a position to approve all requests for contribution concessions. On a monthly basis, DHMS collects more than R6 billion in contributions. Providing support to cover the contributions of all members would deplete all R19bn of reserves in just three months, rendering the Scheme unable to pay members’ claims and sustain itself. Given the anticipated potentially large claims cost for COVID-19 related cases, there is no more important a time than now for the Scheme to remain capitalised and in a strong cash position so as to provide support to members.
Through engagement with the Council for Medical Schemes, and in line with President Ramaphosa’s call to support small businesses, DHMS has set aside R2.3 billion from its reserves in order to support contribution holidays for small and medium businesses affected by the COVID‑19 outbreak. This enables qualifying employers with between 10 and 200 employees to defer up to two months of medical scheme contributions for their employees, whilst retaining this important cover during this time. These contributions will be repaid over a period of up to 12 months after the deferment period. No interest will be charged on the contributions deferred, and the concession is effective immediately. This provides support to another 600 000 DHMS members.
I would like to mention, that following the example set by the President, the entire Board and Chief Executive of Discovery will donate a third of their salaries and fees over the next three months to efforts to fight the pandemic. This funding will be allocated to the Solidarity Fund and other COVID-19 related causes.
It is also worth noting in March, Discovery Health Medical Scheme (DHMS) launched the DHMS WHO Global Outbreak Benefit which was immediately accessible to members on all DHMS plans. This benefit provides funding in full from the Scheme’s risk pool to cover the tests and treatment for confirmed COVID-19 cases. All policyholders of Discovery’s employee-based health insurance product, Discovery Primary Care, have access to full funding for testing and treatment costs for confirmed COVID-19 cases. Additionally, any waiting periods for Discovery Gap Cover policy holders are being waived, to fund valid COVID-19 claims.
Understanding the challenging operating and financial environment in which all Discovery clients may find themselves during this time, the Group has further introduced a range of options to support vulnerable groups by offering flexibility in premium payments across its insurance products to ensure they can continue their cover at this critical time. We encourage clients who are facing financial constraints due to the containment period and business interruption to contact their financial advisers or Discovery directly to discuss their options before making any financial decisions.
Enough said. We will leave it up to the reader to draw their own conclusions.