How medical schemes work for businesses

medical schemes for businessesmedical schemes for businesses
medical schemes for businessesmedical schemes for businesses

How medical schemes work for businesses

As a business owner, you need to keep your staff in the best possible health. This is because you need them to perform at their best possible levels, increasing turn around time and profits. In order to do so, you should provide them with a group medical scheme with hospital plan prices that are affordable for both your business’ wallet and theirs. Below is some helpful information on how medical schemes work for businesses.


What is a closed medical scheme?

A closed or ‘restricted’ medical aid scheme is one that is offered on behalf of companies to their employees. They are also offered to people who are within a certain industry or trade, such as the SAPS (South African Police Service) or the mining industry.

Some companies offer to pay the full amount into the medical aid scheme while others ask their employees to contribute anywhere from 10 to 30 percent of the monthly amount. Your company medical scheme is required to cover all PMBs (Prescribed Minimum Benefits) and can use networks, designated service providers and formularies to manage costs associated with PMBs.

Can you force your employees to belong to a medical aid scheme?

The answer to this is yes… and no. If the medical aid scheme is provided for within the framework of the ‘conditions of service’, or if your employees receive a subsidy from the company.

If the medical aid scheme is not specified in your employees’ contract, you cannot force them to be part of a specific one. If your staff is on a cost-to-company package, then they are allowed to choose a scheme of their choice, but it is likely that some will opt to be part of the company or group medical scheme due to the affordability of it.


The money issue

If you are a smaller business, you may not be able to afford to pay the entire contribution without help from your employees. This means that you will have to compare hospital plans in South Africa in order to find one that suits your budget.

In order to find one that is affordable but also provides good benefits for your employees, you will need to look at independent global credit ratings, cash reserves, solvency ratios and the average age of beneficiaries. This will allow you to find one medical aid provider, easing the process of payment and cutting down on the red tape that comes with setting up a group medical scheme.


Promoting wellness works for all businesses

Promoting wellness in your company by offering a medical aid can work wonders for the morale of your staff. You will also be encouraging workplace commitment and showing your employees that you truly care about their wellbeing.

Medical cover also reduces liability on smaller businesses if employees require a loan for medical expenses that are unexpected. Your staff also have the assurance that they will be able to visit a doctor if they feel ill, allowing for better productivity across the office. If you make the joining of a company medical scheme easy, your employees will be able to join without a waiting period before they can make a claim. This benefits those who may have conditions that they need to alleviate in order to work better.


Choose an advisor

As a business owner, CEO or manager you may not have the expertise or knowledge to know which medical aid is best for your staff. A medical aid broker or advisor is the best option if you feel that you might need help to choose the best possible option for your staff.

You will need to ensure that the broker or advisor you choose is FAIS (Financial Advisory and Intermediary Services) accredited so that you can be sure they are offering sound advice. A broker is able to look at your financial situation as a business owner and offer you a list of affordable hospital plan prices or group medical schemes that are best suited to your needs. They can also offer help if you need to restructure your scheme due to hirings or firings.


Can my staff switch medical aids?

If your employees are already part of their own medical aid or hospital plan, they will still easily be able to switch to a company medical aid scheme. They can do so by giving notice to their current provider and requesting a transfer to a company medical aid.

Some businesses have a clause that employees do not have to belong to the company medical aid if they are already part of a spouse’s or partner’s medical aid scheme but if their relationship status should change, they can easily become a part of the company medical scheme. If your employees do not feel the need to become part of your company scheme, do not force them to leave the medical aid they are already with. This will lower morale across the board.

medical schemes for businesses