5 May, 2008

Have you been wondering why it is taking you so long to put up an investment plan you always wanted? It could have to do with how you cater for financial needs.

Medical cost is one of the expenses that one can plug by having an insurance cover that ensures your plan for money sapping investments.

A medical policy does not prevent one from a disease, but gives one self-assurance. Those who don’t have medical covers do so out of ignorance or because they cannot afford.

While shopping for an individual or family medical insurance, Mr Elijah Wachira the General Manager of AAR, a health management outfit, says Medical insurance plans (MIPs) needs versus available monetary resources should be assessed.

Over the years health management organisations (HMOs) and insurance companies have introduced different MIPs which cater for various classes of people. Many people have been fortunate to get health cover through schemes operated by their employers.

Medical health planners estimate that one can save up to 80 percent in expenses compared to spending from one’s pocket. This, they say, is because health management organisations are able to run their operations better and manage costs when they have a pool of people under a plan or scheme.

They say easy payment schemes are available for individuals, making medical cover more affordable. A medical cover, they add, allows one to have peace of mind with the assurance that a good percentage, if not the entire bill is paid by the insurer.

In addition, MIPs process claims faster and the premiums are low compared to claims. MIPs are fulfilling because patients can access various hospitals the HMO or insurance company is in partnership with.

It is important for one to consider that an MIP could exclude pre-existing, congenital as well as some chronic conditions. "They can, however, be included as a supplementary benefit upon payment of additional premium," he says.

AAR offers four schemes in its ambit of health products, each with monetary limits depending on preference and affordability.

The Gold Scheme has annual hospitalisation limit of up to Sh20 million offering among other things accident hospitalisation of upto Sh10 million with an illness hospitalisation of an equivalent amount.

The other covers — Silver and Bronze — come with almost similar benefits, albeit, with a lower monetary payment in case of an illness. Accident hospitalisation, for instance, entitles one to Sh8 million under Silver and Sh1 million in bronze.

A good HMO should have an expansive network. Lack of market footprint or network by a provider limits its benefits because it cannot cater for medical needs if, say, a clients travel often in the course of their work.

A preffered HMO should have a good record system for timely and efficient delivery of service as well as insurance and medical professional expertise.

Wachira notes that many prospective clients focus pretty much at the value of the premium and not on the benefits thus a good cover must have balance between benefits, limits and exclusions.

He notes that the old and slowly vanishing harambee culture is also a demerit to the take-up of MIPs. "People never prepared for medical costs because after all it was a community affair and not an affair of the individual," he adds.

Wachira says MIP providers have continued to devise products that fit the affordability of many segments of clients. HMOs as well as other medical insurance providers have adopted strategies for low premium products, monthly payment option, and premium financing through the help of banks as well as health and nutrition education to manage preventable conditions hence reducing costs of intervention.

"Today medical insurance is quite affordable because premiums are driven by benefits, limits and exclusions," Wachira says.

Source : http://www.eastandard.net/