There are different waiting periods for hospital plans and it is important to understand how this can affect your cover. In the ideal world, a person would sign up for a hospital plan, be it a medical aid or a hospital cash back plan, when they are young and healthy and do not need the cover. These financial products are a form of protection for when you need it in unforeseen circumstances, not for capitalising at the last minute when the situation is at hand. Waiting periods mean different things for different financial products but in terms of hospital plans with regards to medical and cash back cover, a waiting period means any span of time when you cannot claim but have to keep paying your premiums.
Why are waiting periods necessary?
Many consumers see waiting periods for medical aid and hospital cash back plans as an unnecessary irritation. All too often South African consumers complain about these waiting periods and cry foul without understanding why it is so essential. Waiting periods are not there to just protect the medical scheme or insurer, it is actually a means to protect the loyal existing members. Nobody likes to pay for cover they do not need and this mentality is also seen with medical aid and a cash back plan. However, once ill and facing the hospital a person quickly scrambles to find cover.
The problem though is that some people quickly sign up for cover at the very last minute, utilise it and quit thereafter. Their claims outweigh their contributions and the scheme or insurance company is out of pocket. These financial losses are passed on to the existing members who then have to pay more in terms of monthly premiums. Thsi unscrupulous behaviour on the part of some members who quickly join and resign thereafter has prompted financial services providers to put waiting periods in place. It ensures that a person who signs up for cover has to at least contribute a bare minimum before claiming.
How long is a waiting period?
The duration of a waiting period varies. We are focussing on hospital plans with regards to medical aid and cash back cover.
- There is a general 3 month waiting period for new members on a medical aid during which they cannot claim for any medical expense. This falls away if you aware changing from one medical aid to another.
- There is a 12 month waiting period on medical aid for pre-existing conditions. This means you cannot claim for any condition that you have at the time of joining the scheme. This not only refers to diseases, but pregnancy as well.
- There is a 6 to 12 month waiting period on hospital cash back plans during which you cannot claim for any payout for hospitalisation. This waiting period may fall away if you are in an accident. There is usually a 12 month wait for pregnancy-related claims.
- There is a a 2 to 3 day waiting period before you can claim for hospitalisation on a hospital cash back plan. This time span is more correctly known as a deferred period and means that you cannot get a payout if you are hospitalised for less than 2 to 3 days.
Chronic Diseases, Surgery and Pregnancy
There are certain circumstances where the waiting period becomes a major concern for consumers. It is usually relating to chronic diseases, surgery and pregnancy. The fact is that private healthcare in South Africa is expensive and without medical aid, at the very least a medical aid hospital plan, most of us would not be able to afford the level of healthcare that we want. Then there is the allure of a payout from a hospital cash back plan which puts money in your hand when you are hospitalised and can help you fund some of your medical expenses. But let’s consider the facts for a minute.
While most of these waiting periods fall away in the event of an accident, you should be responsible to sign up for cover ahead of time as you never know when you will need surgery or when a chronic disease will arise. Pregnancy can be planned but even here you should consider having the proper hospital plan in place if you are active. Even though the waiting period may now affect the upcoming claim that you may be facing, do not be discouraged from signing up for cover.
Remember you can be in this same predicament in one year’s time, if not sooner, and then regret why you had not signed up earlier and passed the waiting period.