What contributes to it and how to manage it

It’s not even halfway through the year and your medical savings have run out, leaving you in the dreaded self-payment gap (SPG). Sound familiar?

It’s something that happens to many medical aid members, but about which many are in the dark.

“Of those members, two thirds reach their annual threshold and receive extended cover for day-to-day healthcare expenses.

What is it?

The SPG is an amount assigned to members, that they must pay in full for day-to-day expenses, once their medical savings have run out. These claims are submitted to the scheme, not for refunding, but to reduce and close the gap – after which the above-threshold benefit takes effect and the scheme again pays for day-to-day claims.

It’s applicable to schemes/plans with an above-threshold benefit (limited or unlimited) – usually top-end plans.

SPGs are mechanisms “which the scheme can use to transfer some of the ‘out of hospital expenses’ risk from the scheme to the member,” adds Jill Larkan, GTC healthcare consulting head. This allows schemes to reduce premiums and make [the plan] appear more attractive.

That the SPG’s not fixed may be a surprise.

What adds to the gap?

Some claims made from savings, may add to the SPG.

Some reasons why Discovery’s SPG increases:

  • Medical savings accounts smaller than the annual threshold;
  • Members claim for over-the-counter (OTC) medicine – including schedule 0, 1 and 2 – from savings;
  • Claims submitted from the previous year and paid from savings;
  • Claims paid over a plan’s annual benefit limits;
  • Special payment applied for from savings;
  • Procedures and medicine that don’t count toward closing the SPG paid for, e.g. certain alternative treatments such as reflexology and acupuncture.

Tips for closing the gap

SPGs are only reduced by claims members pay for that are at medical aid rates, among other things, writes Ross.

For example, if you pay a GP who charges R500 – and submit the claim to the medical scheme to reduce your SPG – if the medical aid rate for a GP consultation is R320, your SPG will only reduce by R320.

As such:

  • Evaluate your medical aid plan: what you’re covered for, at what rates, with which providers and if a specific hospital or pharmacy network much be used, says Kotze. Members really wanting to avoid any SPG, must consider a comprehensive top plan, which can be costly, adds Pascale Bargehr, Total Risk business development officer.
  • Ross concurs. Ensure you really need a plan with an above-threshold benefit. If you’ve been on a plan for two years or more and have never closed your SPG, you’re likely a little over-insured. A financial advisor can assess your needs and place you on an appropriate plan.
  • Look for schemes offering benefits paid from risk. These benefits offer more value for money and are in addition to savings and day-to-day benefits.
  • When entering an SPG, ask your scheme what counts towards closing the gap. Then manage your spending efficiently to maximise benefits, writes ThinkMoney here.
  • Always use a partner network hospital, doctor or pharmacy: you won’t be charged over the rate agreed on with the scheme. This helps avoid copayments, deductibles and additional out-of-pocket expenses, says Gerhard van Emmenis, Bonitas Medical Fund acting principal officer.
  • While using your medical savings, and when in your SPG, use service providers (GPs, dentists, etc) who charge medical aid rates. Then your SPG will be at the same amount originally indicated on the benefit schedule, says David Narun of Informed Healthcare Solutions.
  • “If [hospital] procedures attract a copayment, negotiate with the provider on alternative/more conservative treatment protocols where possible, explains Ann Streak, Alexander Forbes Health senior consultant.