Medical aids are going to have to come to terms with picking up the bills for members’ HIV/Aids treatments, reports Sarah Bullen
The medical aid industry by its own admission does not have a proud record of being proactive in addressing the costs of HIV/Aids. With South Africa boasting the highest HIV infection rate in the world, its apparent nonchalance in the face of the staggering dimensions of the problem smacked of Custer’s last stand.
HIV affects the lifeblood of the medical aid industry: the young and the healthy. The people who usually don’t claim.
In reality schemes were bobbing and weaving, trying to avoid picking up the tab for what is a very costly disease. A research paper by ING Barings into the demographic impact of Aids on the economy released in December estimates the direct health-care costs of treating Aids is currently around R3-billion per annum.
When the catalyst for change came from the government in the form of the Medical Schemes Act, schemes put up a fight but eventually capitulated.
Medical schemes admit that it is incredibly difficult for them to count the costs of their Aids spending retrospectively – simply because the opaque nature in which they handled HIV-positive patients precludes any significant breakdown of costs.
Prior to the implementation of the new Medical Schemes Act, medical aids used two key mechanisms to contain the costs of treatment for HIV-positive members. The first was guarding the gates through underwriting. This mechanism would allow medical schemes to assess a patient’s risk prior to admission. They could send the patient for a medical check-up or HIV test and could refuse membership on the grounds of perceived risk, or adjust contributions according to the risk profile.
The second was draconian exclusion. If a scheme could not filter an HIV-positive patient out by its underwriting it could slap ludicrously low limits on its benefits. The result was a situation in which claims for HIV-related treatment would be fudged, making a breakdown of costs difficult.
According to calculations released by Old Mutual Healthcare this week, between 10% and 18% of the total benefits paid out to its members by a medical scheme are for HIV- treatment. It projects that number will move up to between 35% and 46% within 10 years.
It calculates that an HIV-positive member on anti-retroviral drugs draws on costs of around R17 000 a year. With members tapping into new anti-retroviral drugs that figure can rise to R50 000 per annum. Pathology work comes in at R6E000 and general practitioner or outpatient treatment at around R1E440 a year.
Medscheme’s Aid for Aids’ research shows that the scheme incurs the heaviest costs for an Aids member over a hospitalisation period. In 1997 they estimate this cost at around R70 000 a year. Old Mutual Healthcare puts the current cost of hospitalising a patient with full-blown Aids around R36E000 a year.
It has become clear to medical aids that they can minimise HIV-related costs is by keeping patients out of hospital for as long as possible though medication which can keep full-blown Aids at bay for up to 15 years.
Managed care schemes – the buzzword in the industry – are an attempt by medical aids to manage chronic care costs by directing their members as to the most appropriate treatment for their condition.
It can happen, explains Old Mutual Healthcare’s Adrian Baskir, that a GP will diagnose a patient as HIV-positive and it will be the first HIV case he has encountered.
In a managed care plan the doctor and patient can tap into a panel of experts who can advise on treatment.
“We really have no idea if this attempt to manage costs is going to work,” said Baskir. “The industry has got to plunge in head first. If schemes start going under we may have to go back to the drawing board.”
The second route medical schemes are taking to deal with the costs of Aids is the accountant’s route: tight limits on payouts, whether it be dental work or anti-retroviral drugs. Taylor puts it succinctly: “This model is simply dumb.”
The slow gestation period of the disease from an HIV-positive diagnosis to full-blown Aids, coupled with an infection rate estimated at 350 a day, makes one thing certain, that the costs have only just begun.