Hospital Cash Plan Myths Busted!

  • Hospital cash plans, also referred to as health cash plans have recently increased in popularity amongst South Africans as an option for supplementary hospital cover for expenses that may not fall under the medical classification.
  • However, most consumers are not yet reaping the full benefits of this cover. This is all because of a number of misconceptions about the plans on offer.
  • These cash plans were designed to help consumers cover expenses for their day-to-day living that incur during a hospital stay. At least, that is how they should work when implemented properly.

Some consumers may misuse the benefits of these plans based on information they have heard from family and friends and not based on the information contained in the policy itself. Licenced insurers follow a set of guiding principles that are generally quite similar, but the cover that they offer is not necessarily the same too.

Consumers are encouraged to consult individual policy documents to be certain of what cover with which they are provided, or alternatively speak with their insurer.

Let’s demystify some common myths regarding these health cash plans:

Myth #1: A health cash plan is an affordable medical aid policy

A medical aid policy and a health cash plan are not the same, and a cash plan is not a suitable substitute for medical aid.

The cover that each of these plans offer is not the same. A medical aid plan covers medical expenses, while the cash plan covers other, non-medical living costs that result as a result of your hospitalisation.

Myth #2: Only hospital expenses can be covered by the funds received

The cash payout received from the cash plan can be used however the consumer sees fit. It can be used for non-medical expenses such as child-minders, house-sitters or pet-sitters.

Alternatively, the cash can be used to supplement income or replace income that may have been lost during the time of hospitalisation. You can even use the funds for out-out-hospital medical expenses if you do not have full medical aid cover (i.e. a hospital-only plan).

Myth #3: The cash plan benefits are limited to only cash

Hospital cash plans may offer other benefits that are not only cash pay-outs. Some plans may offer consumers other free services such as telephonic access to 24/7 advice from a qualified nurse in the South African language of their choice.

This offers customers the benefit of peace of mind, should they have any medical queries following their hospital stay.

Myth #4: Your pay-out will be dependent on the total expenses you incur in hospital

Only consumers who are eligible for such benefit will be guaranteed a payout based on the time spent in the hospital. This pay-out is in no way linked to the expenses charged by the hospital.

Myth #5: You are required to get a medical check-up to take out cover

You are not required to have a medical assessment done when you apply to take out cover for a hospital cash plan. You do however, have to disclose any pre-existing medical conditions to the insurer when you apply. These include cancer, diabetes, heart conditions, and the like.

Once your application is successful, your insurer will advise you on how your circumstances will affect the cover you receive from the policy and whether or not you will be issued with a waiting period before the cover is active.

If you are still uncertain about any aspect of the cover, you will receive or how to make the most of the cover you get from a hospital cash plan, speak to your insurer or industry expert.

When it comes to applying for a hospital cash plan, you need to take into account your lifestyle and what type of cover is best for you. In South Africa, given the current statistics of road accidents that lead to hospitalisation, having a hospital cash plan and medical aid cover is always a good idea.

There are a wide variety of plans to choose from to suit your precise needs. Most of the well-known service providers in the country offer these hospital cash plans, so you may not even need to find a new provider.