Medical aid industry in reasonable shape
CONTRARY to some perceptions, the medical aid industry is looking fairly healthy: reserves have grown by nearly 8% to R294-million and the collective membership has risen by almost 5% to over six million.
However, the industry has had to draw on its investment income to finance its collections shortfall: schemes paid out 18% more in benefits in 1996 than the year before - and received only a 14% increase in contributions.
This is according to a Representative Association of Medical Schemes (RAMS) 1995 survey of 155 schemes, released this week.
The survey shows that 6,5-million people rely on medical aid schemes to help pay toward their bills, which amounted to R14,4-billion during the year.
Their total contributions were R14,8-billion and administration costs charged by the schemes amounted to R907-million.
Government schemes are looking rather more frail. Despite showing the biggest growth in membership base - 7% - their reserves fell 26%.
The survey report attributes the decline in net assets to growth in membership in state schemes as well as the overall operating cost ratio.
The survey also shows that more people are going to private hospitals, and possibly also staying there for longer - private hospital costs rose by a third.
Fewer people went to provincial hospitals as total expenditure fell marginally.
Moreover, more people have been visiting specialists over the last five years.
Total expenditure on specialists was almost double that on general practitioners.
The greatest cost to medical aids is still medicine, which accounts for a third of their total budget.
The industry paid out only 75% of medicine claims, but reimbursed members for 94% of private clinic costs.
The survey report points out that managed health care has not proved to be a panacea to all the industry's ills. Nor has it operated in opposition to traditional medical schemes.