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  • To Downgrade or not to Downgrade Your Medical Aid

To Downgrade or not to Downgrade Your Medical Aid

  • Posted by Smart Money
  • Categories Medical
  • Date Oct 17, 2018
  • Comments 0 comment

These days, it seems like all of us are talking about the high cost of living, and comparing notes on ways to save our hard-earned money.  I have personally been dealing with many clients who want to cut down on their medical aid costs, and come to me for advice. Unfortunately, the advice I can give my clients is often not what they want to hear – to downgrade your medical aid to pay less on your monthly contribution means that you will be sacrificing benefits you had on a higher plan.

In some cases, downgrading is the right choice, but you need to research the options you are looking at carefully, before making a decision. Your financial advisor is the best person to explain the difference in benefits if you are looking at ways to save money.  For example, a single person who is young and healthy, can easily downgrade to a plan that covers hospitalisation only – and cover the occasional doctor’s visit or dental check-up out of their own pocket.

But a family with small children who visit healthcare providers on a regular basis, or someone with chronic conditions, need to be on a more comprehensive plan if they don’t want to end up in a situation where their health suffers because they cannot afford to pay for a doctor’s visit out of their pocket.  The decision to try to save money on a medical aid should not be taken lightly – it could end up being the biggest mistake you make as you may be compromising you or your family’s health.

A good idea when considering downgrading is to request a claims history for at least the past three years from your medical scheme – you can then have a look at where you spent the most, and also have an idea of whether these expenses happened only occasionally, or whether it is a regular expense.

Then ask your financial advisor to take your claims history into consideration when doing a Needs Analysis for you.  In conjunction with your advisor, you can then look at different options and decide whether cost-cutting on your medical aid expenses would be viable for you, or would pose too much of a risk in the long run.

 

This article was adapted for Smart Money and was taken from: https://money101.co.za/downgrade-downgrade-medical-aid/

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