Health Minister Aaron Motsoaledi issued an ultimatum in April to South African medical schemes to voluntarily adopt preventative rather than curative health policies, or be forced by government to do so.
Jan Howell, consulting actuary from Omac Actuaries & Consultants, agrees that a shift to preventative healthcare is necessary, but points out that this needs to be accompanied by incentive programmes to encourage members to make use of these benefits as well as improved communication with healthcare providers.
Howell says that, unless schemes introduce some kind of incentive for members to make use of preventative benefits, adding more preventative benefits will not necessarily result in increased savings for the schemes.
The recent Omac Actuaries & Consultants Healthcare Survey 2010 showed that the 63% of open schemes and 18% of closed schemes that already offer some form of preventative benefits do not attribute much value to the benefits because members generally do not make use of them.
“People respond to incentives. Schemes need to offer members lower premiums or increased benefits for preventative behaviour in order to see a real change.”
However, Howell says the current Medical Schemes Act does not allow medical schemes to do this.
“Therefore benefits must be offered outside of the scheme — as in the case of the Discovery Vitality programme.”
According to Howell, properly aligned incentives can be of great benefit to medical schemes in the treatment of chronically sick members.
‘It won’t happen to me’
Howell explains that a person with one chronic condition has almost four times the average expected claims per year compared with someone with no chronic condition. This is exacerbated by the fact that there is a high degree of non-compliance to treatment plans for chronic members, which results in unnecessary and expensive hospitalisation.
He gives the example of a diabetic patient whose treatment plan includes a visit to a podiatrist once a year to ensure that their feet are properly looked after.
“Failing this, the patient runs the risk of requiring amputation. Not only is this very expensive, but it also dramatically affects the patient’s quality of life. However, members are either not aware of the real risk of amputation, are too myopic in their time horizon (‘that’s too far into the future to worry about now’) or adopt an ‘it won’t happen to me’ attitude and choose not to go for their annual visit.”
He says that the only way to encourage compliance to chronic disease treatment plans is to introduce immediate penalties for non-compliance — such as higher premiums or decreased benefits. Once again, this is not allowed by current legislation.
Howell also believes that schemes need to drastically improve communication with providers and members to educate them about the benefits available, be it preventative or treatment plans.
“If a provider is made aware of the preventative or treatment plan benefits available, by recording these on their patient files, this may improve the utilisation of this benefit. This could result in earlier identification of diseases, appropriate treatment of chronic diseases and potentially reduce the cost of treating the disease,” he says.
Furthermore, if providers could share biometric information with schemes, schemes could identify their “at-risk” or ill beneficiaries earlier.
If schemes then use their disease management programmes to contact these members and educate them on their disease, while working with doctors to manage the disease, this may result in a change in members’ unhealthy behaviour. — I-Net Bridge