Your medical aid provides financial cover for medical emergencies or if you need to visit a private hospital for treatment. Gap cover steps in when your medical aid doesn’t cover all the costs.
You’re probably asking why your medical aid doesn’t cover all the costs… The reality is that hospitals and specialists can basically charge what they want, as long as ‘fair value’ is provided to customers. How much your medical aid contributes to these costs, however, is regulated. Each scheme has a reimbursement rate — the so-called Medical Scheme Rate (MSR) or ‘base rate’ — for various treatments and procedures.
Your plan might cover 1–3x the base rate, but even at 3x, the contribution might not come close to what the specialist actually charges. If you have gap cover, you’ll be covered for part or all of the difference — the gap — between what you’re charged by your doctor and what your medical aid contributes.
To give you a real world example: A private gynaecologist recently charged R33,000 for a planned C-section birth delivery, and the medical aid only contributed the base rate of R4,500 — a difference of R28 500. Yikes!
What is gap cover?
It’s an insurance product that you can only use when you’re a member of a registered medical aid scheme. It’s not a medical aid in itself and it can’t be substituted for medical aid. It’s cover that you get on top of your medical aid. A monthly premium is charged, and you can typically cover your immediate family under one policy.
Despite the name, gap cover might not cover the entire gap. Benefits typically cover 2–5x the base rate, which is calculated on top of what the medical aid pays back. So, to use the previous example: with gap cover benefit at 5x the base rate, you’d be paid back R22,500 (5 x R4,500) plus the R4,500 from your medical aid, leaving a shortfall of R6,000 that you would still need to pay out of pocket.
How does a claim work?
First, you need to claim from your medical aid. They’ll provide you with a claim statement, which will show how much you claimed, how much you were reimbursed and a reason for the shortfall (which can be an anonymous code). You need to submit this statement to your gap cover provider, along with an invoice or statement from the healthcare provider in question. They’ll assess and pay you their portion of the shortfall directly.
Do I need it?
That’s the million-rand question… Unfortunately, premium treatment is expensive — if you want access to the best doctors and specialists in a private practice, then gap cover might be the way to go.
Just make sure you understand the specifics of the cover and what the limits are. As with medical aid, you can’t sign up for gap cover today and have your baby delivered tomorrow. There’s often an exclusion period for pre-existing conditions (including pregnancy), which could prevent you from lodging a claim for as long as six months to a year.
Speak to your existing medical aid provider — many schemes offer bolt-on gap cover designed to work with your plan. Or check if gap cover is offered by your employer as part of your group arrangement. And always read the fine print!