Health insurance versus medical aid as an employee benefit


If you are looking to hire new employees for your business then you are probably aware that the more benefits you can offer, the better your chances of acquiring skilled applicants. Benefits could be anything from having a healthy lunch served in the office to offering a subsidised gym membership or a provident fund. But the most popular corporate benefit is the offer of medical cover. And, it is popular not because companies all seem to offer this benefit but rather because employees are extremely attracted to the idea of having this particular benefit as a part of their package.

 

In South Africa, landing up in hospital is scary

 

Being ill enough for hospital or getting injured in an accident is daunting enough. You really don’t need to worry about whether you have medical cover and can afford treatment or not. So, having medical cover is important. But, the different terminology that falls under medical cover is not always clear. Most people have many questions. What is covered in a hospital plan? What if I get a hospital plan but with paid add-ons? How much money will I actually save by opting for a hospital plan over comprehensive medical aid? And, is it worth it? As a business owner looking to subsidise medical cover for their employees, you may have some of the same questions.

 

And, now there’s a new kid on the block; medical or health insurance

 

Health insurance works like insurance in general. In fact, it is regulated by the Short Term Insurance Act and not the Medical Schemes Act. Medical aids and hospital plans are however, governed by the Medical Schemes Act. This difference matters because it means that health insurance can be used for a broader set of issues that are not bound to being in hospital or seeing a doctor. For instance, health insurance can be used to cover funeral costs whereas there is no medical aid or hospital plan that will offer that type of coverage. Health insurance company products are extremely attractive as they are a more cost-effective option in comparison to comprehensive medical aids or even a hospital plan. Many of these health insurance companies offer group cover and this is most beneficial to employees as that extra cover goes a long way to staying healthy.

 

Whether your employees have their own medical aid or not, health insurance is of particular benefit to just about anyone. Health insurance company products offer usually means that waiting times for doctor’s consultations, hospital visits and access to immediate healthcare when there’s an emergency, are diminished. As far as finding a medical benefit that will suit your small business’s pocket and give your employees a sturdy medical benefit as a part of their package, health insurance is a prime option.

 

Medical aid frees you up of ever worrying about health care

 

Medical aid is comprehensive. It offers full cover of all medical care which frees you of any financial burden when it comes to health care or hospitalisation. It is a costlier option than any other type of medical cover but it will pay for just about any procedure, operation, treatment or consultation. However, “just about” is the most important part of that sentence because while medical aids are bound by law to cover all prescribed minimum benefits (PMBs) there are often cost differences involved as the medical professionals don’t always stick to the National Recommended Price List. Their private fees can be close to double what is recommended and the shortfall is for the patient’s pocket.

 

Medical aids often limit the amount of benefits that can be used on a yearly basis by its members too. However, medical aid cover gives complete peace of mind to those who can afford it. These people can afford the annual check ups and consultations which those who don’t have medical don’t go for, because it is too expensive. For example, women can go for an annual pap smear at a clinic but they cannot go for a mammogram unless they can afford to do so at a hospital. If they decide to make use of public hospitals they can wait for months for an appointment so many simply don’t go at all.

 

So as a small business owner you should look into both options extensively and see what can suit your business’s budget. No matter what you decide you don’t have to pay for the full amount. You can subsidise the monthly payment and deduct the balance from the employee’s salary. Medical cover is an excellent benefit to offer your employees and a great way to attract new talent, particularly in our country. By offering this benefit you will be assisting your employees financially and in terms of their well being. Nothing will make them happier.

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