Members are often disappointed when their medical schemes do not pay for their healthcare services in full.
One of the reasons why a claim may not be paid in full is because there is a co-payment.
What is a co-payment?
A co-payment is a portion of the cost of a health service not covered by your medical scheme that you, as a member, have to pay for out of your own pocket.
It can be:
The method used to calculate the co-payment must be detailed in the scheme’s rules.
Co-payments are typically applied to:
In some cases, the co-payment may be a deductible that you cannot claim from your medical savings account.
Why do schemes impose co-payments?
Medical schemes use co-payments to manage the behaviour of members and providers to contain costs and ultimately the contributions you pay.
Co-payments aim to influence you to consider selecting certain providers or medicines in order to contain the medical scheme’s costs.
Actuaries work out the cost of contributions based on the expected costs the medical scheme will have to pay. The expected costs are based on the average use of different services, medicines and other medical devices and supplies and the expected price. If the medical scheme allows claims at any price, these costs could quickly exceed the expected costs and contribution income that the medical scheme collects to pay these costs. If the medical scheme makes a loss, it will most likely have to recover it through higher contributions the following year.
To contain costs, medical scheme trustees may impose co-payments to encourage you to use cheaper medicines or providers with whom the medical scheme has contracted. Providers who contract with a medical scheme, and agree to be part of its network agree to charge the medical scheme rates in return for the medical scheme steering members to them.
Medical schemes may also impose co-payments on certain benefits that the trustees regard as ones that are sometimes accessed unnecessarily. If you and your doctor know, for example, that a certain scan attracts a co-payment, you are only likely to have that scan if your doctor believes it is absolutely necessary.
Co-payments on expensive treatments like oncology are typically imposed once you exceed a certain annual limit. These co-payments are aimed at keeping the treatment costs within the annual limit.
When can your scheme not impose a co-payment?
You cannot be charged a co-payment for the diagnosis, treatment and care of a condition that is 
a prescribed minimum benefit (PMB) unless your scheme has named a designated service provider (DSP) that you are expected to use and you fail to use that provider. Read more: What is a prescribed minimum benefit?
Your scheme may not impose a co-payment if you fail to use the DSP because:
If you voluntarily agree to receive treatment or services from a non-DSP, be prepared for a co-payment. Some schemes impose steep co-payments on members who, for example, belong to an option with cover in a network of hospitals but then use a non-network hospital. The co-payment could be the difference in the cost of contributions for the cheaper network hospital option and the more expensive option that allows you to use any hospital.
If your doctor prescribes an alternative medicine to one on the scheme’s formulary or recommends you use the brand name medicine because the formulary or generic medicine is ineffective or unsuitable, your scheme should also waive the co-payment. However, the scheme will require a motivation from your doctor as well as evidence that you tried the formulary or generic medicine and it was not effective.
How can I avoid co-payments?
Use any DSP your scheme has named for PMBs.
If there are co-payments on medicines, use generic medicines or medicines on the formulary rather than brand-name medicines.
If your scheme option lists certain general practitioners, specialists, pharmacists, dentists or optometrists in a network, use those providers as they have contracted with the scheme to charge scheme rates.
If your scheme option lists certain hospitals you need to use, do not use any other hospitals (non-network hospitals) as doing so will likely result in a co-payment. Network hospitals are ones that have an agreement with your scheme to charge the scheme rates.
If your scheme option has a co-payment for certain scopes or scans, check with your doctor if you really need that procedure. If the doctor believes the scope or scan is necessary, the co-payment may be unavoidable unless your condition is a PMB and meets the treatment protocols for that condition.
Ensure you get pre-authorisation for any hospital admissions, including day hospitals, and any expensive procedures such as scans or scopes, and ask if you will be liable for any co-payments. Record the name of the person you spoke to and get the reference number as calls are recorded.
Take out gap cover – depending on the policy terms, gap cover may reduce your out-of-pocket exposure for certain co-payments, deductibles and any shortfalls in cover. Read more: What is gap cover?
