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Chapter 6 - Labour Law

Medical aid schemes for employees

A medical aid scheme helps members to pay for their health needs, such as nursing, surgery, dental work and hospital accommodation. It is a type of insurance scheme. For this service, members and their employers pay regular contributions to the scheme. The law says that medical aid schemes must pay for medical expenses such as hospital, doctor and dentist bills, medicines and other medical services like special dentistry and physiotherapy. Some schemes offer more than this.

Advantages and disadvantages of medical aid schemes

The advantages of a medical aid scheme are that:

• it protects employees if they suddenly have to pay large, unexpected medical costs and they don't have to delay their medical treatment because they don't have any money
  
• employees get better medical care because they are looked after by private doctors, clinics and specialists instead of overcrowded public hospitals.
  

The disadvantages of a medical aid scheme are:

• It is expensive and fees are always increasing
  
• If an employee has dependants in the rural areas it does not help to have medical aid because there are no private health care facilities
  
• There are often many hidden costs in the schemes and the scheme might only pay a small percentage of the costs and the employee has to pay the rest;
  
• Some schemes set limits for benefits, for example, a scheme could set a limit of R720 per year for medicines prescribed by a doctor for a single member. If the member needs to buy more than R720 worth of medicines in a year, she or he will have to pay for any costs of medicines above this limit.
  
• Some medical costs are completely excluded from medical aid schemes. Employees must then pay for these costs themselves even though they are paying into the medical aid fund every month.
  

The Medical Schemes Act

The Medical Schemes Act (No 131 of 1998) has made the following changes to medical aid schemes:

• there must be standard-rate fees for people to join medical aid schemes regardless of their health or age
  
• there can be no discrimination on grounds of peoples' health, for example, refusing to allow a person to join a medical aid scheme because they are HIV-positive, or because they have asthma or diabetes
  
• the definition of dependants includes spouses (husband or wife) and natural and adopted children
  

This means that people living with HIV or AIDS can no longer be turned away from medical aid schemes on grounds of their medical condition. The minimum medical benefits included for HIV-related illnesses include hospital admissions as well as necessary medical treatment. The treatment for people with AIDS-related illnesses also continues until death.

The Act also sets out a complaints procedure for people who have a complaint against a medical aid scheme.