Despite the increasing popularity of hospital cash plans (also known as health cash plans) as supplementary cover for non-medical expenses, some consumers are still not maximising this benefit due to a few misconceptions.
Lee Bromfield, CEO of FNB Life, says when used appropriately, a health cash plan can go a long way to help consumers cover daily living costs and other expenses that could be incurred while being hospitalised.
He demystifies some of the common myths about health cash plans:
1. It’s affordable medical aid cover – a health cash plan is not a substitute for a medical scheme and the cover is not the same. It provides a cash payout for non-medical expenses that are incurred from being hospitalised. As a result, you can still choose to have a medical aid plan even if you have a health cash plan.
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2. Funds can only be used for hospital expenses – consumers are free to choose how they want to use the cash. For instance, you can either use it for non – medical expenses or to supplement your income for the period that you cannot work.
3. The payout is based on total hospital expenses incurred – the total pay-out is guaranteed based on the time spent in hospital for consumers who are eligible to get a benefit. It is by no means linked to the expenses charged by the hospital.
4. The benefits of a health cash plan are limited to cash only – FNB Life adds free benefits to its health cash plans that are not limited to money. Customers have access to qualified nursing advice via a free 24/7 telephonic service in any South African language. This provides customers with peace of mind, should they be anxious about any medical query.
5. A medical check-up is required to get cover – no medical assessments are required when taking out a health cash plan. However, it is a pre-requisite to inform your insurer if you have a pre-existing medical condition, such as a heart condition, diabetes and cancer etc. Your insurer will then advise on how it impacts your policy or whether there will be a waiting period imposed.
“Although licensed insurers abide by similar guiding principles, the cover they provide is not always the same. Therefore, it is essential for consumers not to base their decisions on hearsay, but rather what is specified on their individual policy documents.
If you are unsure about the terms of your policy, seek guidance from your insurer or an expert to avoid making mistakes,” concludes Bromfield.