Why “covered” doesn’t always mean “paid in full”

Many people believe that if their medical scheme approves their treatment, all the costs will be paid. However, this is not always the case.

Medical schemes offer different plans with different benefits, rules, limits and provider networks. Even members of the same medical scheme may have different levels of cover because they belong to different plans.

This means your medical scheme may pay all, part or, in some cases, none of the healthcare cost. Understanding your cover before treatment can help you avoid unexpected costs.

"Before planned treatment, members should not be afraid to ask questions. Check what your medical scheme will pay for, whether there are any co-payments, whether authorisation is needed and whether the healthcare providers involved in your care are part of your medical scheme's network.

“It is also worth asking if there are likely to be any costs that you may need to pay yourself. Taking the time to have these conversations before treatment can help you better understand your cover, avoid unexpected costs and make informed decisions about your healthcare," says André Joseph, Funders and Health Policy Executive at Life Healthcare.

“It is also important to review your medical scheme cover from time to time. Your healthcare needs change over the years and a plan that suited your needs in the past may not be the best option today. Taking time to understand your benefits and reviewing your cover regularly can help you make more informed decisions about both your healthcare and your healthcare funding,” explains Ann Streak, Principal Healthcare Consultant at Alexforbes Health.

One hospital admission, several healthcare providers

Many people think that their hospital admission is covered as one cost. However, several different healthcare providers can be involved in their care and each may charge separately.

It is important to know that doctors and other healthcare professionals involved in providing care and treatment while you are in hospital are usually independent practitioners and not employees of the hospital. This means that your hospital stay, including nursing care, is a separate account from the accounts charged by specialists, anaesthetists, radiologists, pathologists, physiotherapists and other healthcare providers involved in your care.

Each healthcare provider may charge different fees and have different arrangements with your medical scheme.

Even if the hospital you are admitted to is part of your medical scheme’s network, other healthcare providers involved in your care may not be. This could affect how much of the cost your medical scheme will pay.

Healthcare providers may also charge fees that are higher than the amount your medical scheme covers. Before planned treatment, ask your doctor about the healthcare providers who may be involved in your care, what their fees are likely to be and whether they are part of your medical scheme’s network. You should also check with your medical aid what costs will be covered and whether any co-payments or shortfalls may apply.

“Many medical aid members are surprised to find that a medical scheme may not always pay the full account. This can happen when a healthcare provider charges more than the amount covered by the medical scheme, leaving you, as the member, to pay the difference out of your own pocket. Before planned treatment, ask your medical scheme what it will cover, whether any co-payments may apply and whether the healthcare providers involved in your care are part of its network. Taking these steps beforehand can help you avoid unexpected costs and better understand your cover,” advises Ann.

Common medical aid terms and what they mean

Hospitals and medical schemes use common healthcare funding terms. Understanding what they mean can help you better understand your cover and avoid unexpected costs.

• Medical scheme (medical aid)
  Many South Africans refer to their medical scheme as a medical aid. While both terms are commonly used, “medical scheme” is the term used in South African law. A medical scheme helps pay for your healthcare costs according to the rules and benefits of your plan.
  
  
• Pre-authorisation
  This refers to the approval from your medical scheme before certain planned treatments, procedures or hospital stays. If pre-authorisation is required and not obtained, some costs may not be covered. Emergency treatment usually does not require immediate authorisation, but your admission may need to be authorised once your condition is stable. Pre-authorisation does not guarantee that all treatment costs will be covered.
• Designated Service Provider (DSP)
  A DSP is a doctor, specialist, hospital, pharmacy or any other healthcare provider or service that your medical scheme has chosen for its members to use. Using your medical scheme’s chosen DSPs can help reduce the amount you pay from your own pocket. If you choose a provider that is not part of your medical scheme's DSP network, you may need to pay part of the cost yourself, according to your medical scheme's rules and benefits.
• Co-payment
  An amount you may need to pay upfront for some healthcare services, depending on your medical scheme’s rules and benefits. This may apply, for example, if you choose a healthcare provider that is not part of your medical scheme's DSP network.
  
  
• Tariff/rate shortfall
  The difference between what a doctor, specialist or hospital charges and the amount covered by your medical scheme. You may be responsible for paying the remaining amount.
  
  
• ICD-10 codes
  International Classification of Diseases (ICD)-10 codes are used by healthcare providers to describe your illness, condition or symptoms. These codes help your medical scheme decide which benefits apply and how claims should be covered.
  
  
• Prescribed Minimum Benefits (PMBs)
  PMBs are certain health conditions and treatments that all medical schemes must cover by law. This includes emergency medical conditions, a list of 271 defined medical conditions and 26 chronic conditions. If you have one of these conditions, your medical scheme must pay for the treatment and care you need, according to its rules. You may need to use your medical scheme's chosen doctors, hospitals or other healthcare providers to receive full cover. If you choose a provider outside this network, you may have to pay part of the cost yourself, according to your medical scheme's rules.
• Gap cover
  Gap cover helps pay for certain healthcare costs that you may have to pay yourself when your medical scheme does not cover the full amount. It works alongside your medical scheme and does not replace it. The cover you receive depends on the rules, limits and exclusions of your gap cover policy. Gap cover does not pay for treatments or procedures that are not covered by your medical scheme.

“Many members are surprised to learn that the healthcare providers involved in their care and their medical scheme each play different roles. Healthcare providers deliver your treatment while your medical scheme determines which costs are covered according to the rules and benefits of your plan.

“Medical scheme networks can vary depending on your scheme, your plan and the healthcare provider involved. This means that some healthcare providers may be part of your network while others may not. Before treatment, it is important to check which healthcare providers are covered by your medical scheme, whether any approvals are needed and whether any co-payments or shortfalls may apply. Understanding these requirements can help you avoid unexpected costs and better understand your cover,” says André.

Authorisation does not equal full cover

Many patients believe that once a hospital admission or procedure has been pre-authorised, all the related costs will be paid by their medical schemes. However, this is not always the case. Pre-authorisation simply means your medical aid has approved the admission procedure or treatment. Depending on your medical scheme benefits and rules, there may still be co-payments, benefit limits or other conditions that apply.

Before treatment, always ask your medical scheme exactly what has been approved, what costs will be covered and whether there are any costs you may need to pay yourself.

“When members are unsure about their cover, one of the most important things they can do is contact their medical aid and ask how their benefits apply to the treatment they are planning to receive. Rather than only asking whether something is covered, ask whether pre-authorisation is needed, whether there are any network requirements, if co-payments or shortfalls may apply and whether there are any exclusions, benefit limits or funding conditions applicable. Understanding these details before treatment can help avoid misunderstandings and unexpected costs later,” says André.

What to check before a planned hospital admission

If your admission or procedure is planned, it is a good idea to check how your medical scheme benefits apply before the treatment. This can help you understand any requirements, co-payments or costs you may need to pay yourself. When contacting your medical aid, you may need to provide relevant information, such as the main member’s membership number, patient ID, doctor’s name and practice number, referring GP details and the ICD-10 codes.

“Authorisation is often viewed as a simple approval process, but it is really a conversation between the healthcare provider and the medical scheme about how a patient's care will be funded. The more accurate and complete the information provided upfront, the easier it is for members to understand what has been approved, what conditions may apply and whether there are any costs they should plan for before treatment.

“It is important to note that an authorisation is not a guarantee that all healthcare costs, procedure codes or diagnosis (ICD-10) codes will be covered in full. Funding remains subject to your medical scheme benefits, rules, clinical information, applicable tariffs and any co-payments, shortfalls, limits, or exclusions that may apply,” says Ann.

Six questions to ask your medical scheme or broker before a planned hospital admission or procedure:

1. Do I need to use specific hospitals, doctors, specialists or other healthcare providers to be covered by my medical scheme?
2. Has my hospital admission or procedure been pre-authorised?
3. Are there any co-payments, exclusions, limits or costs that I may need to pay myself?
4. Will the healthcare providers involved in my care bill separately and could I be responsible for any shortfalls?
5. Will my medical scheme cover any medication that is prescribed on discharge?
6. Are all the healthcare providers involved in my treatment part of my medical scheme's network?

“A hospital admission is often just one part of your healthcare journey. Depending on your condition, you may need consultations, tests, medication, rehabilitation or follow-up care before and after your hospital stay. Understanding what your medical scheme covers at each stage of your care can help you plan ahead, avoid unexpected costs and focus on your recovery,” says André.

“One of the biggest shifts members can make is moving from asking 'Is it covered?' to asking 'How is it covered?'. The answer is often more important. Understanding how benefits apply, what funding pathway will be used and whether any conditions or requirements exist can provide a much clearer picture of what to expect than a simple yes-or-no answer,” advises Ann.

How private hospitals work with medical schemes

When you are preparing for a hospital admission, there are often several funding and administrative requirements that need to be managed. Hospitals work closely with medical schemes and healthcare providers to help coordinate these processes and support patients throughout their hospital journey. Most patients are understandably focused on their health and treatment rather than the details of their medical scheme. Hospital admissions teams, case managers and billing teams can help patients understand the information they may need, guide them through administrative requirements and assist with questions that arise before, during and after their hospital stay.

“Preparing for a hospital admission can feel overwhelming, especially when patients are focused on their health and treatment. Hospital admissions teams, case managers and billing teams can help guide patients through the process, answer questions and provide information about the administrative requirements that may apply. This support can help make the admission process smoother and less stressful for patients and their families,” explains André.

What to do if you receive an unexpected shortfall

If a hospital admission is not covered as expected, identify which healthcare provider issued it and what the outstanding amount relates to. A hospital-account query may need to be taken up with a hospital, while questions about a specialist’s fees should generally be taken up with that practice. If the shortfall relates to how your benefits were applied, your medical scheme or broker can help explain how the claim was processed and whether any plan rules, limits or exclusions were applied.

André advises that if you have questions about your hospital account, the hospital's billing team can help explain charges relating to your hospital stay and assist with any account queries.

“If your question relates to your medical scheme benefits, which costs will be covered or why you may still have money to pay, your medical aim or broker will usually be best placed to assist. If you receive an account from an independent healthcare provider, such as a specialist or anaesthetist, radiologist or pathologist, and need more information, you should contact that healthcare provider's practice directly,” he adds.

“A claim that is not paid as expected does not necessarily mean it was processed incorrectly. Sometimes the outcome is the result of benefit rules, missing claim information or funding requirements that the member was unaware of,” says Ann. 

She encourages members to ask their medical aid to explain the reason for the funding decision in plain language and to clarify what options, if any, may be available when querying a claim.

Know your cover before you need it

Understanding your medical scheme and benefits can sometimes feel overwhelming, but knowing what your plan covers can help you make more informed decisions and avoid unexpected costs. If you are planning a hospital admission or procedure, take time to check your benefits, ask questions and understand any requirements that may apply.

“One of the most valuable things patients can do is involve a trusted family member or support person in the process. They can help gather information, ask questions and keep track of important details before treatment. When people are dealing with health concerns, it can be difficult to remember everything. Having someone to support you can make the experience less stressful and help you feel more confident when making decisions about your care,” says André.

Being informed helps you make better healthcare decisions and gives you greater peace of mind when you need care most.

For admission or hospital-account queries, contact your chosen Life Healthcare hospital or visit our hospital directory to find a hospital near you. For questions about your medical scheme benefits or cover, contact your medical scheme or broker directly.

Disclaimer: Life Healthcare is a private hospital group and not a medical scheme. The information provided is intended for patient education and as a general guide to help patients better understand medical scheme cover. It is based on information published by the Council for medical schemes (CMS), the statutory regulator for overseeing private health financing through medical schemes in South Africa. The article is not intended as medical, financial or benefits advice. This article does not cover every aspect of medical scheme funding, benefits, rules exclusions, limits or healthcare funding arrangements and should not be relied on as a comprehensive explanation of medical scheme cover. As medical scheme rules and benefits differ between schemes and plans, patients should always confirm how their specific cover applies directly with their medical scheme or broker.