The global healthcare landscape has experienced significant shifts over the past two years, prompting individuals to reevaluate their priorities when it comes to access to quality healthcare.
The COVID-19 pandemic brought to the forefront the critical importance of healthcare, further emphasising the need for accessible and affordable medical services. In a recent interview with Mbali Khumalo, Managing Director of Simeka Health, we explore the impact of the past two years on how individuals perceive and prioritise healthcare, the financial challenges they face, and innovative ways financial advisors can help clients prepare for healthcare expenses.
We also delve into the emerging trends and changes in the healthcare industry in response to increased focus on healthcare funding and discuss the future of healthcare funding in addressing current financial pressures.
Reevaluating Healthcare Priorities
The past two years have seen a significant shift in how individuals perceive and prioritise access to quality healthcare. The uncertainties surrounding health, particularly during the COVID-19 pandemic, underscored the necessity of healthcare for all. Many households faced economic pressures, yet statistics show that most retained their healthcare cover.
The importance of mental health support also became evident, leading to the development of virtual mental health solutions, primarily offered to employer groups. This saw an increased demand for Employee Assistance Programs, which provide mental and other support to employees. Access to mental health support, particularly during times of crisis, became a critical aspect of healthcare.
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Affordability and Balancing Act
Financial challenges have become a key concern for consumers when it comes to healthcare funding. Balancing the need for healthcare with financial constraints can be a daunting task. Healthcare expenditure competes with essential needs such as food, clothing, and shelter. While healthcare remains a high priority for young people, their spending patterns often do not align. Many argue that their chances of making claims are lower, preferring to allocate funds to other immediate needs. It is advisable to at least have accident, emergency, and catastrophic cover, with a hospital plan often providing such protection.
Neglecting primary and preventative care can lead to higher risks of catastrophic health events and chronic conditions. Late Joiner Penalties are another financial impact for individuals who delay joining healthcare schemes, sometimes reaching up to 75% of the risk contribution.
Innovative Approaches for Financial Advisors
Financial advisors play a crucial role in helping clients prepare for healthcare expenses, such as Medical Aid, Hospital Plans, and Gap Cover. Advisors should prioritize the health and well-being of their clients, emphasizing that being healthy and able to work should be a top priority. Employers also play a significant role in providing access to quality healthcare offerings, ensuring that employees have coverage without waiting periods, exclusions, or Late Joiner Penalties. Tax credits can help alleviate financial pressures through immediate relief when medical scheme contributions are deducted via payroll or during the tax return filing process.
Accredited consultants are essential for guiding members to tailor their healthcare cover to suit their needs. They can recommend a combination of products, such as Medical Aid, Hospital Plans, and Gap Cover, to find the best solution for clients. Additionally, advisors should highlight the potential hidden risks for scheme members, such as co-payments, tariff shortfalls, and benefit limits being exceeded. Gap cover can provide valuable protection at a reasonable cost in such situations.
Emerging Trends in the Healthcare Industry
The past two years have brought about several significant trends and changes in the healthcare industry:
- Relaxation of Compulsory Membership: Employers have relaxed their compulsory membership policies, allowing lower-earning employees to choose from a range of healthcare options. This approach offers more flexibility and affordability for individuals.
- Employee Assistance Programs and Primary Health Insurance: Employer Assistance Programs and primary health insurance products have gained popularity as solutions for healthcare needs. These programs provide accessible and affordable healthcare options for employees.
- Cost Containment: Both medical schemes and primary health insurance products have focused on cost containment by offering nurse visits or virtual GP (General Practitioner) consultations as primary care gatekeepers. Additionally, medical schemes have introduced more networks to control costs, with members accepting restricted choices to keep contributions affordable.
The Future of Healthcare Funding
The future of healthcare funding is expected to see the introduction of new players and innovative solutions to address current financial pressures faced by consumers. Hospital groups are offering Gap products, while pharmacy chains are providing primary care products. There is a growing trend of bundled holistic healthcare offerings from major players like Sanlam, Momentum, and Discovery, which offer comprehensive reporting and a clearer understanding of employees’ health status.
Intermediaries and financial advisors will play an increasingly key role in assisting employers in navigating the complex healthcare market. Proper, accredited advice is essential to guide employers in offering their employees the best possible solutions, including medical schemes, primary care, Employee Assistance Programs, Gap cover, and other health initiatives like preventative care and on-site clinic solutions where applicable.
The past two years have reshaped the way individuals perceive and prioritize healthcare, and the financial challenges they face have prompted the healthcare industry to adapt and innovate.
As we move forward, the healthcare funding landscape is expected to continue evolving to provide more accessible, affordable, and comprehensive solutions for consumers, with the guidance of financial advisors playing a pivotal role in helping individuals and employers make informed decisions about their healthcare coverage.