Bestmed, South Africa’s fourth largest scheme held its 52nd Annual General Meeting and Conference on Friday, 3 June 2016 at the CSIR in Pretoria.
The Chairperson of the Scheme, Mr. R.F. Camphor, spoke about the economic strain that the world faced during 2015, mentioning that the local economy experienced a growth of 1.3%, which is insufficient to fund the growing needs of the country. Making reference to violent protests at academic institutions and changes in government, particularly the replacement of the minister of finance, he said that these intensified the pervasive uncertainty in the national economy.
“These uncertainties,” said Camphor, “have a huge impact on the country’s healthcare environment and on the medical scheme industry. Moreover, we experienced an escalation in the cost of services rendered in respect of Prescribed Minimum Benefits (PMBs).”
The scheme’s rules of addressing the election of trustees had to be amended to provide for a special election, where six more trustees could be elected to bring the board composition to 12. The process was finalised in May 2015, and the newly constituted Board of Trustees was announced at the 51st AGM on 26 June 2015.
Bestmed also discussed its invitation to participate in the public debate by the Competition Commission at the AGM. The public hearing, which commenced early in 2016, saw Bestmed’s CEO, Dries la Grange deliver a presentation on the matter of medical schemes’ administration services. La Grange pointed out in his presentation that medical schemes under self-administration and those with outsourced models ought to have similar benefits; the over-regulation that burdens the self-administered schemes needs to be addressed.
He also spoke about the PMBs and the impact they have on healthcare costs at the inquiry, which is an ongoing pain point in the industry. There remain issues of code manipulation, misdiagnoses and the general administration of PMBs, which is an expensive burden on members. For a self-administered scheme, clinical people need to be appointed to handle the PMB claims’ administration which adds to the costs.
More specific to Bestmed, the scheme had budgeted for a fair healthcare surplus, but recorded a deficit of R39.6 million caused by higher expenditure on claims than what had been predicted. The unusual trend observed was that of members depleting their savings accounts quicker that previous years, which resulted in them using pooled benefits much earlier, thus increasing expenditure above what had been anticipated when budgets were drawn.
Health of the Scheme
By the end 2015, Bestmed had claimed fourth spot of the open medical schemes in South Africa, with a total membership sitting at 94 266 principal members. “We remain one of the few schemes that have managed to record a positive membership growth during these tough economic times,” noted la Grange.
“What has also helped in maintaining the financial health of the scheme,” added la Grange, “is the fact that our total non-healthcare costs for 2015 remained well below the average cost within the industry. This means we can improve our ability to give our members value for money. This drive towards containing our non-healthcare costs started in 2012 when we reverted to self-administration. The average non-healthcare cost per beneficiary per month increased by just 5.8% per year, which is lower than inflation, which means that a larger portion of our members’ contributions is available to them as benefits.”
Summarising the year that was 2015, la Grange said, “This was a period of contradictions, of achievements and disappointments, of moving forward and standing still. However, at a deeper level, these are the signs of an organisation that is undergoing a transition while steadily making its way toward the attainment of a set of long-term goals.”
More about Bestmed
With over 52 years of experience under its belt and delivering healthcare benefits to more than 200 000 beneficiaries throughout South Africa, Bestmed is one of the oldest and most established medical schemes in South Africa and trusted as the scheme of choice to access quality healthcare.
Bestmed now provides medical benefits to second–generation dependants who have opted to become principal members. The company is one of the few schemes in South Africa that has succeeded in keeping its administration costs at below the industry norm contribution fee and is one of the fastest paying schemes in the industry.
Based in Pretoria, Bestmed has representation in most of the country’s provinces. The scheme has 13 benefit options that serve the total healthcare market.