SA's No 1 Insurance Blog

Networked hospitals are great…but don’t get caught with your pants down!

“What is a networked hospital?” you ask

Okay, so first things first; it has nothing to do with Netcare hospitals, and everything to do with medical aid schemes.
Chances are, if you’re a member of a medical aid scheme, then one of the options open to you is a network option. In fact, it might be the only option offered at your scheme.

A network doctor has an agreement with your medical scheme regarding what they will charge for each and every procedure. Of course there must be some sort of incentive for them to do this, and I’m guessing it’s about seeing more patients. Your medical scheme then offers you an incentive to make use this doctor, usually in the form of lower costs.

A network hospital works in much the same way.

Now that we’re on the same page regarding networked options; let’s look at why they make sense.

Who should choose a networked option?

The major attraction is cost.
Take for instance the Discovery Classic Saver plan versus the Classic Delta Saver plan (Delta being a network hospital option).

A single member on the Classic Saver option should pay R2, 773 a month.  This allows them the use of a private hospital of their choice anywhere in the republic.
That same member would pay R2, 214 a month on the Classic Delta Saver plan. What are we talking of here…five hundred odd Rand? The only difference between the two is the choice of hospitals.

If you don’t have any intention of going to hospital this year, it would make perfect sense to go with the more affordable Classic Delta Saver option.

But be careful…
The Classic Delta Saver plan offers slightly less in the way of day-to-day savings. That’s for things like doctor and dentist visits – R8, 316 on the Classic Saver plan versus the R6, 636 on the Classic Delta Saver plan. So don’t blow that R500 cost saving every month just in case a time comes when you need it!

The second attraction is the list of hospitals.
If you happen to live around the corner from one of these networked hospitals go for it – especially if you’ve only heard good things about it.

Who shouldn’t choose a networked option?

Let’s start off with a story…

In November last year, a client informed us that his wife was going in for an op in January. He was concerned about the fact that her surgeon only operated from the Linksfield Clinic.

Why the concern?

He intended to downgrade his medical aid plan in January to one of these networked hospital options. The problem with downgrading to a networked option is the penalty incurred when using any hospital not on the network list. In his case it was well over R7, 000.

Usually the penalty works like this – the R7, 000 needs to be paid to the hospital prior to having the procedure done.
Fortunately for him, he had gap cover in place to take care of this. And while we’re on the topic of gap cover; not all gap cover policies take care of this penalty, so choose wisely when it comes to gap cover.

Network Hospital Checklist

But here’s where his story gets interesting.

He failed to mention that his wife was going in to have wisdom teeth removed. Nothing wrong in having wisdom teeth removed, but it helps to check if there’s a co-payment involved when dentistry is done in a hospital or day clinic. The co-payment here was also somewhere in the region of R5, 000.

Suddenly he was faced with a potential R12, 000 in penalties and co-payments. Nice way to start the year rolling – save a couple of hundred Rands every month, but get nailed for R12, 000 right off the bat in January.

So the first question to ask is: “Does the possibility exist that I might need a hospital which isn’t on the network option?”

For instance, what if your treating physician doesn’t operate from this hospital? In such a case, will you decide to swap physicians or swap hospitals?

The second question to ask is: “Can I afford to take care of the penalty when using a non-networked hospital?” 

If you can’t then the options are:

  • Stay on an option allowing a wider choice of hospitals, or
  • Take out medical gap cover which takes care of this penalty. Often you can downgrade your medical aid option to a cheaper option, add on medical gap cover, still pay less, and end up enjoying better benefits than previously.

The third question to ask is: “Is this hospital conveniently located?”
While the cost might sound great, living in Umtata and having your closest network hospital in East London just doesn’t make sense.

This, of course, raises this question:

What happens in an emergency?

Rush to the nearest hospital, after all, it’s your life at stake. Forget about networked and non-networked. Let them get you to the nearest private hospital. Once stabilised, they can always transfer you to a networked hospital.

Conclusion

Networked options make absolute sense. If you’re in good health and aren’t aware of any health condition which might necessitate a stay in hospital in the coming year. Why pay more for something you probably won’t use anyway?

The difference in cost could then be put to use in purchasing medical gap cover which should take care of potential penalties. In fact, you’ll quite probably find that the gap cover improves your existing medical scheme benefit by a large margin.
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Until next time.

The InsuranceFundi Team