Make sure you understand the co-payments and self-payment gap before choosing this one!
We’ve already given you the big picture view of the Priority range in a previous article.
The biggest issues we have with the Priority series are:
- by far was the number of co-payments on this range.
- Other concerns were the self-payment gap and
- the limited above threshold benefit.
In the case of the Essential Priority plan, this gets tricky.
The Discovery Health rate
The Essential Priority plan offers 100% of the DHR for treatment by medical professionals while in hospital.
We don’t think 100% will cover you in full. (And 200% on the Classic Priority plan is not enough either).
The hospital bill itself gets paid at 100% of the DHR and hospital coverage is unlimited.
Unlimited means your in hospital costs for the year have no ceiling.
The amount going to your Medical Savings Account
15% of your contribution goes towards the medical savings account. This has two disadvantages and one advantage:
- A smaller MSA
- A bigger self-payment gap, and
- A cheaper cost than the Classic option.
Let’s start off with the cost:
- Main member – R2, 763 monthly
- Adult dependants – R2, 172 per adult
- Children – R1, 103 per child (A maximum of three children are charged for)
This gives us the following MSA for the year:
- Main member – R4, 968
- Adult dependants – R3, 900 per adult
- Children – R1, 980 per child (A maximum of three children are used in this calculation)
Word of warning:
Remember this is a line of credit. If you join halfway through the year, then you get half the amount. If you decide to leave Discovery Health halfway through the year – and in between you’ve used up all of your MSA – then you’ll have to pay back half of the MSA allocated to you.
Which brings us to the above threshold benefit
The above threshold benefit is the hurdle you need to reach before Discovery Health starts picking up the bills after having run out of MSA.
- Main member – R14, 240
- Adult dependants – R10, 670 per adult
- Children – R4, 660 per child (A maximum of three children are used in this calculation)
But here’s how the above threshold benefit on the Priority range works.
It’s limited. Once you reach this limit you will once again have to pay your own bills. So if you’re someone who digs deep into the above threshold benefit every year, this ain’t the plan for you.
Let’s take a look at the amounts available once you’re in the above threshold benefit:
- Main member – R12, 080
- Adult dependants – R8, 610 per adult
- Children – R4, 170 per child (A maximum of three children are used in this calculation)
So let’s look at how the self-payment gap works for the main member:
- Main member MSA for the year – R4, 968
- Main member above threshold benefit – R14, 240
- The difference between the two is your self-payment gap – R9, 272
- The amount available once you’re above threshold – R12, 080
Here’s how it compares to the Classic Priority:
|Classic Priority||Essential Priority||Difference|
|Main member cost||R3, 214||R2, 763||R451|
|MSA||R9, 636||R4, 968||R4, 668|
|Annual Threshold||R14, 240||R14, 240|
|Self-payment gap||R4, 604||R9, 272||R4, 668|
|Above Threshold Benefit||R12, 080||R12, 080|
With a self-payment gap that size on the Essential Priority plan, and the small difference in cost, I’m sticking to the Classic Priority option.
Your potential self-payment gap could also be much bigger:
- Schedule 0-2 (over-the-counter) medicines obtained via prescription or any means, are added to the self-payment gap even if paid from available MSA
- Schedule 3 and above medicines from the non-preferred medicine list (Brand name medicines) are only included at 75% of the DHR. The remaining 25% of the DHR is added onto your self-payment gap.
- Schedule 3 and above medicines from the preferred medicine list (Generic medicines) are paid at 100% of the DHR but be careful since the pharmacy you use might charge more than the Discovery Health Rate thereby creating a self-payment gap. Use Dischem or Clicks or the Discovery MedXpress service to minimise this.
- You overspend on spectacles and dentistry. For instance, on the Priority range your annual limit for spectacles is R4, 550 per person. You purchase a pair for R5, 000 thereby adding R450 to your self-payment gap.
Remember to keep sending your medical bills to Discovery Health while in self-payment gap – how else will they know whether the gap is closing?
Next we’re going to study the Saver range which is the last to offer you a medical savings account. From here on in, self-payment gaps and above threshold benefits fall away.
If you missed some of our previous Discovery Health 2018 articles click on the links below:
- Choosing you plan
- Is KeyCare the right match for you
- The Executive plan
- The Comprehensive series
- The Priority series
- The Classic Priority plan
InsuranceFundi has partnered with some of SA’s most reputable insurance and investment companies. We believe that everyone should have access to a wide range of comprehensive and affordable solutions. Pick the product you are interested in below, and expect a call-back from our partners.
Until next time.
The InsuranceFundi Team