Do insurers even know how to get medical information from state medical facilities?

It is a serious question: I am of the opinion that they don’t.

Fortunately, I have some experience in this regard. In December I wrote an article about trying to get medical information from the Victoria Hospital, a state hospital in Wynberg, Cape Town, in support of a member’s disability claim. It took more than 2 months, but the correct process was followed and the report was eventually sent to the insurer. It was frustrating, but I learnt a lot going through the process from beginning to end. It also put a lot of the inefficiencies experienced in the long term insurance industry into perspective for me.

“I am not sure what else to do.”

I recently received an email from a service provider trying to obtain medical information from another behemoth state hospital, this time for underwriting purposes. They described the process as “an absolute mission”, which would be the general experience if you try to get information directly from a hospital or clinic, ignoring proper procedure.

Insurers expect efficiency from state hospitals already inundated with patients seeking medical care. They are understaffed, underfunded and overcrowded, yet the doctors at these facilities do produce the medical reports required for insurance companies to either approve or decline claims. But how do you get them?

You would think there is an opportunity for the insurers to collaborate with the State so that they can receive these medical reports as quickly as possible so that their clients can be fairly and equitably assessed for the benefits they have been promised.

What do the claims stats say?

Unfortunately it doesn’t appear that claim statistics for groups are readily available. I was looking at Liberty Life’s Claim Statistics from 2017, and – bearing in mind that these are retail, not institutional, statistics – it struck me that the top 5 occupations of successful claimants were directors (13%), managers (10%), business people (8%), administrators (3%) and housewives (3%). The report goes on to say that “the diversity of occupation, from business people to housewives, shows that everyone is at risk of death, disability or critical illness.” I absolutely agree. I am also sure that it wouldn’t be unreasonable to assume that most of these claimants would have access to private medical care, either through their own or their spouse’s medical aid. While these people alone only made up 37% of all claimants, they may also be better able to afford the premiums for individual life cover (in addition to their medical aid premiums, I mean).

Public or Private healthcare?

“…71.2% of households said that they would first go to public clinics, hospitals or other public institutions”, StatsSA, 2018

Let’s consider this graph contained in the 2017 General Households Survey conducted by StatsSA (as accessed on 26 February 2019):

If the population of South Africa was an estimated 56.5 million (StatsSA, 2018, page 7), that means potentially more than 40 million people need to or do seek medical treatment from public facilities as a first port of call.

Fewer than 1 in 5 South Africans belong to a a medical aid.

Only 16.9% of the population was covered by medical aid in 2017, says StatsSA

46.65 million South Africans are not members of a medical aid, nearly 5 times more than the 9.5 million who are. Please refer to the table below, taken from page 24 of StatsSA’s 2017 General Household Survey:

Note how the percentage of the population with medical aid has been decreasing since 2013, to a point where it is just 1% more than it was 15 years before, yet insurer’s assessment procedures are designed as if their member base all have medical aid and access to a specialist .

How does this affect employees who have disability cover through their place of employment

For many employed South Africans, it is compulsory for them to join their employers risk scheme or retirement fund which has risk benefits (where this is offered), and for many employees the cost of a medical aid or private medical care is simply beyond their reach. For the vast majority of South Africans, this means that they still rely on the state for healthcare.

As long as insurers are not geared to assess a claim where the member is not receiving private medical care, the member could probably be paying for a benefit they have little hope of receiving.

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