Pressure is mounting on authorities to finalise the Low-Cost Benefit Option (LCBO) Framework, which – according to its proponents – will make it cheaper for millions of South Africans to access medical aid benefits.
Data compiled by US-based Statista Research Department shows that as of 2021, only 16.1% of South Africans were members of medical aid schemes. However, when comparing membership rates by population group, medical aid coverage was higher among white individuals (77.7%) and Indians/Asians (45.1%) than among coloureds (19.9%) and Black Africans (9.3%).
AfroCentric Group CEO Ahmed Banderker said LCBOs will allow younger workers, who normally have to subsidise older workers, get into the system at affordable rates they can afford.
“The starting point of a medical aid is R1 500 for a single person and this is out of reach for South Africans who are working or starting out to work in the informal sector.
“It (LCBOs) is a game changer for all of us. Every single person will be impacted by this in the country. I cannot see any downside to anybody in a market where we have 50 million people. Think about it this way, if very single medical aid member from that particular scheme bought a basket of services from us, they’d be paying R300 less a member a month. Who wouldn’t want that?” he said.
LCBOs are intended for scheme members earning R350 000 or less a year to increase the number of medical aid beneficiaries. It is often argued this is a population that will normally consult for cash, alternatively accessing public healthcare. Aimed at low-income earners, LCBOs offer membership fees of only a couple of hundred rand a month. Typically, no private hospitalisation cover is provided. Prescribed minimum benefits are also not covered.
LCBO detractors have argued that despite the good intention of this policy in trying to increase the number of medical beneficiaries and their access to private healthcare, the claim that 20 million lives of low-income households will benefit from cover is overstated.
The Council for Medical Schemes on Thursday issued a circular requesting public comments on the LCBO framework report, and risk assessment and roadmap. In 2020, it established advisory committees to develop an LCBO framework for consideration by the minister of health.
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