BUYING medical cover can be complex and daunting, so much so that many consumers turn to brokers to help them choose the right benefits and plan.
But how can you make sure your broker will help you choose the medical scheme that best suits your needs and give you the unbiased advice you need? Mark Arnold, principal officer of Resolution Medical Scheme, highlights some key questions to ask your broker before you sign on the dotted line.
Adviser or salesman?
A broker isn’t acting as a financial adviser if he is just selling medical cover from one medical scheme – he’s simply an insurance salesman.
Ask your broker how many members he has placed with different schemes over the past year. “If he’s only placed members with one scheme, be suspicious,” says Arnold.
“You need independent, unbiased advice.” Brokers who receive commission from a particular medical scheme may not recommend the most appropriate one for your financial and medical needs.
Do the comparisons
Your broker should have done his homework with in-depth analysis of different medical schemes before he recommends products to you.
This means not only comparing different options and benefit plans, but also conducting a thorough check of the scheme’s risk profile, membership numbers, growth and premium increases from year-to-year.
A scheme risk profile is related to the average age of its members and the size of its pensioner ratio. “You want to make sure that the scheme you are signing up to is financially stable, sustainable and has consistently affordable increases,” adds Arnold.
Health and wealth analysis
It’s a no-brainer to check that your broker has the necessary qualifications to be giving you financial advice, such as a licence from the Financial Services Board.
In addition, it is important to verify what processes he follows in recommending different schemes and products to you. Your broker should not only do a thorough financial needs analysis based on your individual circumstances, but also conduct a background health check.
“You may find that you have too much life and funeral cover, but can’t afford comprehensive medical cover,” says Arnold. “Your broker should help you balance your portfolio of cover to ensure that you are sufficiently covered for potential medical expenses.”
Understand the plan
Medical schemes each offer different options with a variety of benefits. It’s vital to determine what level of cover you need at each particular life stage.
If you are in your twenties and are fit and healthy, you’re likely to only need a hospital plan that covers catastrophic events. However, in your early thirties, you’re more likely to start a family and would need more comprehensive cover.
As you hit your forties and fifties, you’ll need a medical scheme plan that pays generously for chronic medication as this is when most lifestyle diseases start to develop. Ask you broker to explain the benefits of schemes’ different options.
If you’re new to a scheme, it is entitled to implement a waiting period where you won’t be able to make a claim, even for prescribed minimum benefits.
Ask your broker whether you will be subject to a waiting period and rather switch between plans on the same medical scheme than between medical schemes if your cover is not sufficient.
Your broker should regularly assess your healthcare needs, look ahead to the next five years and advise you on what plan you should be on.
Networks and limitations
Cheaper premiums may mean that your medical cover limits you to a particular network of hospitals and doctors called designated service providers.
Check with your broker to see which healthcare providers you can use and whether this will be convenient if you fall ill. Weigh up the cost difference of moving to a more flexible plan if you would prefer to use your preferred doctor or specialist.
Tariffs and co-payments
Very few doctors and specialists charge standard tariffs, so ask your broker whether your medical scheme will refund you at 100% or a higher percentage of the tariff or you could face steep co-payments.
You could also opt to take out gap cover to make up the difference, without incurring the higher premiums of a more comprehensive plan.
Be honest upfront
Each medical scheme will require you to fill out a medical declaration before taking out cover. “Make sure you go through this with your broker with a fine tooth comb,” says Arnold.
“Even innocent omissions can lead to dire consequences.” He says schemes use the medical questionnaire to accurately assess your risk and the scheme can terminate your contract on the basis of non-disclosure if you didn’t declare previous medical conditions.
If you need authorisation for a treatment within the first 12 months of joining a scheme, they can also approach your doctors to see what you’ve been treated for before you joined the scheme and refuse to cover treatment if you weren’t honest upfront.
Arnold says some members do omit information deliberately, but the vast majority make a genuine mistake in not disclosing. “The best advice is to not to fill out this form in a rush and make sure your broker goes through it with you so that you don’t miss anything out,” he concludes.
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