A quick handy guide to the differences between Medical Aid and hospital Cash Plans. This comparison is specific to the South African environment. Other countries may have different rules governing each of these products.
Hospital Cash plan
Generally cost more than R1,000 per month for adults. A family of 4 could pay about R4,000 per month.
Prices generally range from R100 to about R500 per month.
Cover usually unlimited (could be up to millions)
Limited to about R3,000 per day or a R20,000 lump sum (the figure varies from year to year in line with inflation)
Intended to cover medical expenses
Intended to cover personal expenses other than medical expenses.
Adequacy of cover
Generally adequate for most hospital stays. There may be ‘Gaps in the amount the scheme pays compared to what hospitals and doctors charge.
Cover generally not adequate for hospital expenses that are usually in excess of R3,000 per day. Adequate for covering most personal expenses.
Minimum benefits required by law
Cover for certain conditions such as diabetes, asthma, HIV, Hypertension and 21 other conditions required in full. In addition 270 other conditions have mandatory cover
No minimum cover requirements.
The differences highlighted here are a generalisation of key features. Its important to familiarise yourself with the details of whatever financial product you choose to buy. For Medical Aid this means reading the Medical Aid Scheme’s rules and for Hospital Cash plans, reading the policy documents.