Tips for Deciding on Your Health Plan as Healthcare Premiums Rise

It’s that time of year again when medical plan members have to decide on their health care options in their medical plans. This is also when you find out how much more your contributions to the medical plan will cost in 2025.

Medical plans, health insurance providers, and gap product companies are now announcing their contribution or premium increases and benefit changes for 2025. Therefore, it is a crucial time to review your health care options and adjust them whenever necessary.

Annele Oosthuizen, consultancy manager at Alexforbes Healthcare, says healthcare decisions are rarely simple and you may feel overwhelmed with choosing what cover you and your dependents need in the coming year.

“It is essential to understand any changes to your current plan benefits and whether they meet your future needs. However, remember that if you are happy with your current level of cover, you will not need to make any changes.”

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South Africans consider cheaper medical plans

She says that as the cost of healthcare continues to rise, many consumers may feel pressure to reduce their expenses while ensuring access to quality private healthcare. “You may consider switching to a more affordable plan, but it is crucial to consult your licensed healthcare advisor before making any changes.”

It’s important to fully understand the benefits, costs and implications because you may not have the opportunity to change your plan again until the end of 2025 to 2026. You will have to live with the choices you make now throughout 2025.

Oosthuizen says that before downgrading or upgrading your plan, you should consider the long-term effect on your health needs as well as your financial planning. “While purchasing can save you money, upgrading can provide additional benefits and peace of mind. Balance is fundamental and professional advice is essential to avoid decisions that could lead to greater future financial difficulties.”

To illustrate how your choices now can affect your health care later, Oosthuizen uses these examples.”

Example 1: Downgrade recommendation

Mpho is a young single professional who chose a comprehensive medical plan option. She does not currently have any chronic conditions and is not planning any medical procedures in the next year. She used one-third of her medical savings account for medical care. Your current contribution is R9 300 per month.

After consulting with his healthcare advisor and conducting a financial needs analysis, Mpho was downgraded to a lower plan that suited his needs. Your new healthcare contribution has changed to R4 500 per month, saving you R4 800 per month.

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Example 2: Update recommendation

John is a professional with two dependents on his medical plan. He asked a health consultant for advice because his medical savings account was depleted in the first quarter of the year due to high day-to-day expenses.

During the year, he was diagnosed with a chronic illness and is expected to undergo a surgical procedure next year. Her monthly medical expenses are R3 800 and her healthcare contribution is R6 248 for the whole family, bringing her total medical expenses, including out-of-pocket expenses, to R10 048 per month.

When consulting with his health advisor, he was advised to upgrade his chronic benefits access option, have a larger medical savings account, and reduce out-of-pocket medical expenses. Your new healthcare contribution will be R7 942, saving you R2 106 per month.

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Consider This When Reviewing Your Healthcare Plan

When evaluating changes to your medical plan or health insurance, Oosthuizen says it’s important to look beyond costs. Also consider:

• Your personal health and any pre-existing conditions;
• The health needs of your dependents;
• Your claims history and possible future medical needs;
• Changes in dependents, such as adding a newborn or removing an adult dependent;
• Your level of affordability and budgetary considerations.

“Also, don’t forget the unexpected. Access to expensive treatments could come next year, and it’s critical to ensure you’re adequately covered for out-of-pocket expenses. Your healthcare advisor can help ensure you understand your benefits and any potential deficiencies in your coverage.”

Gap insurance

Medical plan benefits should not be considered in isolation, warns Oosthuizen. “You should look at how gap coverage products can provide additional coverage for out-of-pocket expenses such as deductibles, co-pays and out-of-network fees.

“Gap coverage is particularly useful for hospital treatment, where you may face significant specialist or anesthetist shortfalls. This additional protection can ease the financial burden of unforeseen medical expenses.”

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Keep this in mind when considering changes to your medical regimen options

When considering changes to your medical plan benefit option, it is essential to evaluate several key factors:

• If you choose to downgrade, be aware of the potential impact on your health coverage, especially for future treatments.
• Seek financial advice, as healthcare benefits are a vital component of your financial portfolio and any shortfall can directly affect your financial stability.
• Review whether your current benefits provided enough coverage this year or whether you frequently ran out of money.
• Consider coverage for chronic illnesses, the impact on your chronic drug benefits, and any future planned medical procedures.
• Additionally, assess the level of out-of-pocket expenses you are comfortable with and whether you need comprehensive coverage or just a hospital plan.
• Explore whether gap coverage could enable a more affordable scheme option and assess the long-term financial implications of waiting periods, penalties for late enrollment and network restrictions.

Oosthuizen says that by carefully reviewing your health plan and considering the advice of your accredited advisor, you can make a decision that balances your health needs and financial well-being for the coming year.