Health: Young and fit? Join a medical aid
You’ve just pinned down your first job and you are enjoying having the extra money in your bank account and the freedom that comes with it, but the down side is that you’re no longer on your parent’s medical aid. So why spend your hard earned cash on medical cover?
“Joining a medical scheme when you are young and healthy is a great idea because you should join before you fall ill or really need it,” says Andrew Edwards, Executive Principal Officer at Liberty Medical Scheme (LMS). “Most schemes have exclusions and waiting periods to prevent new members signing up and claiming without having contributed to the fund over time.”
You will also have to pay more on your monthly contribution if you join after the age of 35. In addition, most schemes have strict rules about claims relating to pre-existing conditions. This means that if you have a condition (including being pregnant), before you sign up, you won’t be able to claim for any costs related to the treatment of that condition for at least a year.
Edwards says choosing a benefit package that is affordable and designed for your needs at this stage in your life is very important. “As a young person, you’re more than likely healthy, so be sure to choose a package that gives you good day-to-day coverage, such as visits to the GP,” says Edwards. “You may also want to look at what preventative care benefits your scheme offers as this will help you save money in the long term by preventing illness.”
Options that encourage healthy living, such as covering a variety of screening and diagnostic tests, as well as vaccinations should be on your list of considerations.
“Many young people take their health for granted and avoid spending money on tests such as regular glucose and cholesterol screenings,” says Edwards. “But these can help pick up serious illnesses such as diabetes and heart disease at an early stage so look for a scheme that allows you to pay preventative care benefits from your major medical benefits, rather than from your medical savings account, as this means your savings will last longer.”
“Don’t assume that because you are young, you don’t need medical cover,” says Edwards. “Some illnesses can develop in your twenties and you may require medical treatment from an early age. You don’t want to be trying to join a scheme once you find out you’re sick, as then it can be too late.”
The other thing to consider is that you may be involved in a car accident. Edwards points out that emergency treatment in a private hospital can run into the hundreds of thousands of rands, excluding fees such as anaesthetists bills, rehabilitation costs and medicines. If you are in a car accident and require medical treatment, it can knock out all your savings – or worse still, even impact your family’s finances. “Check to see that there is no waiting period for accidental trauma cover,” says Edwards. “You should be able to claim for accidents from the first day of membership.”
Edwards explains that one of the major decisions young people face is whether to choose a hospital plan, which covers expenses if you are admitted to hospital, or more comprehensive cover. “As a start, you should look at getting hospital cover so should you become seriously ill or are involved in an accident, your treatment in hospital is covered, but as you get older, and the likelihood of you developing health conditions becomes higher, you should look at upgrading to more comprehensive cover,” says Edwards.
Most schemes only allow you to upgrade once a year, so although you can’t always predict when you are going to require major medical treatment, you can talk to your financial advisor and see when would be a good time to upgrade your benefit package.
