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Brokers will still be relevant under NHI



An article published by Fin24 on 16 August, 2018 – NHI will ‘nationalise’ healthcare – Free Market Foundation – suggests that the recently announced Medical Schemes Amendment Bill “… proposes an end to brokers, as they hike expenses for medical aid users.”

The Financial Intermediaries Association (FIA) – which represents the interests of brokers and advisors in the financial services sector, including healthcare brokers – sees the bill differently.

“We have been through the bill and can find no reference to the removal of brokers from the healthcare system,” says FIA CEO, Lizelle van der Merwe. “Independent healthcare intermediaries are, in fact, likely to play an even greater role under the new dispensation than they currently do.”

Van der Merwe says it’s important to understand the extent of the value that brokers add in terms of advice, relationships and administrative assistance before making assumptions that they will be wiped out under the new proposed National Health Insurance legislation.

“Intermediaries are often demonised as mere cost centres in the provision of financial services to individuals and organisations,” she says, “That is until their expertise is needed.”

Navigating the current healthcare system as a consumer can be extremely confusing. Van der Merwe says a knowledgeable broker can help with specialist advice to ensure the consumer gets the best deal and the best healthcare available.

“As an example,” she says, “it is really easy for a member of the public to complete the wrong form or submit the wrong details when going in for an operation. This could have disastrous consequences. A healthcare broker knows all the common mistakes we make and is able to manage the relationship between the patient, the medical scheme and the healthcare provider in order to ensure an agreeable outcome for everyone, especially the patient.

“This won’t change under the new proposed legislation. South Africans will still need experts to advise them on the best course of action, depending on their particular circumstances. It is the consumer’s right to decide whether to use the services of an intermediary or not. The only question under the proposed legislation is how the relationships will work and which regulatory body or bodies will have oversight.”

Greg Setzkorn, who heads the FIA’s finance portfolio committee and sits on the association’s healthcare exco, says the current independent intermediary model is extremely sophisticated, well regulated, and does not add to the costs of membership in a private medical scheme.

“In fact, in the case of so-called ‘orphan policies’ – where a client deals directly with a medical scheme – the internal costs to administer those members are higher than where intermediaries are used,” he says. “Research shows that more medical scheme members make use of the services of independent healthcare intermediaries now than every before.  

“We also have solid evidence that independent healthcare intermediaries always act in the best interests of their clients (members of medical schemes). As stated before, this value is rendered without being a cost driver of private medical schemes.”

Van der Merwe says the FIA and all its members fully support a more inclusive financial services sector in South Africa, including in the sphere of healthcare.

“One of our key priorities is driving transformation and financial inclusion across all spheres of society,” she says. “There is, and will always be, a role for intermediaries in the financial services space. All South Africans should have the right to choose to engage with a broker for advice and assistance with their financial dealings – including when it comes to their health.

“We are in constant discussion with other industry bodies, government and the regulator to ensure everyone gets a fair deal.”