Priciest Discovery Health plans still losing members

The six top-end medical aid plans offered by Discovery Health Medical Scheme (DHMS) continue to lose members, with a 5% decline between the end of 2020 and the end of 2021.

The number of beneficiaries on these plans – Executive, Classic Comprehensive, Essential Comprehensive, Classic Smart Comprehensive, Classic Priority, and Essential Priority – is down 6% over the same period.

Read: Covid spurs Discovery to seek low income clients

Since 2017, in other words over five years, the number of members and beneficiaries on these plans are down 24% and 28% respectively.

The rate at which members are abandoning these top-end plans has been steady since 2015, with declines of between 5% and 6%.

The impact of the Covid-19 lockdowns and the related job losses and salary cuts in 2020 meant a 10% decline in members and 12% drop in beneficiaries in that year.

These six plans had contributions in 2021 (for main members) of between R4 327 and R7 257 per month.

All plans at a glance
	2021		2020		Change in beneficiaries
	Members	Beneficiaries	Members	Beneficiaries
Executive	7 927	16 027	8 237	17 057	-6%
Classic Comprehensive	105 496	223 204	111 632	239 654	-7%
Essential Comprehensive	12 235	22 121	12 738	23 272	-5%
Classic Smart Comprehensive	454	874	467	958	-9%
Classic Priority	74 947	164 791	78 484	174 025	-5%
Essential Priority	5 075	10 129	5 203	10 653	-5%
Classic Saver	316 368	694 333	308 970	680 184	+2%
Essential Saver	154 565	330 891	141 708	302 754	+9%
Coastal Saver	169 966	380 185	172 053	386 250	-2%
Classic Core	46 937	101 414	48 210	104 414	-3%
Essential Core	50 719	111 202	49 036	107 039	+4%
Coastal Core	73 193	165 129	76 359	172 129	-4%
Classic Smart	55 372	110 256	47 602	94 353	+17%
Essential Smart	45 337	52 930	38 854	45 490	+16%
KeyCare Start	6 026	7 812	6 151	8 007	-2%
KeyCare Core	16 903	28 462	15 950	26 389	+8%
KeyCare Plus	211 492	365 033	208 859	365 712	0%
Total	1 353 012	2 784 793	1 330 513	2 758 340	1%

Source: DHMS annual report

The largest of those six higher-end plans, Classic Comprehensive (R5 954 per main member, which includes R1 488 to the medical savings account), has lost 35% of its members over the last five years. This number has accelerated from the 30/31% level in the last few years.

Two plans – Classic Smart and Essential Smart – have continued to see strong double-digit growth in members and beneficiaries.

Together, these plans are up by 16% and 17% respectively. Discovery describes the proposition of the Smart plans as “the most cost-effective in-hospital cover, essential chronic medicine cover plus limited day-to-day cover if you’re willing to use providers in a specified network”.

DHMS’s two largest plans which have over 527 000 members – Classic Saver and KeyCare Plus (which is restricted to a specific income band) – have maintained their growth trend.

Read: Discovery not the only medical scheme losing members

Shifts within the overall base of members will include new members joining DHMS, existing members upgrading or downgrading within the scheme, and members leaving the scheme altogether.

Overall, DHMS saw a 2% increase in members to 1.353 million at the end of 2021. The number of beneficiaries in the scheme was up 1% to 2.784 million.

DHMS refers to Section 33 (2) of the Medical Schemes Act and says “each benefit plan is required to be self-supporting in terms of membership and financial performance, and be financially sound”.

It notes that seven of its plans did not comply at the end of 2021:

	Net healthcare result	Net (deficit)/surplus
Executive	(R218.5 million)	(R200.5 million)
Classic Comprehensive	(R970.7 million)	(R728.1 million)
Classic Priority	(R116.6 million)	R54.3 million
Essential Comprehensive	(R30.3 million)	(R2.6 million)
Coastal Core	(R164.5 million)	R30.8 million
Coastal Saver	(R250 million)	R133.8 million
KeyCare Plus	(R910.5 million)	(R356.6 million)

DHMS says the “performance of all benefit options is monitored on a continuous basis with a view to improving their financial outcomes”.

It also notes that “when structuring benefit options, the financial sustainability of all the options and the requirements of the CMS [Council for Medical Schemes] are considered”.

“The different financial positions reflect the different disease burdens in each option, among many other factors,” it adds.

“The Scheme’s strategy on the sustainability of plans has to balance short- and long-term financial considerations, fairness to both healthy and sick members, and continued affordability of cover for members with different levels of income and healthcare needs.

“While the Scheme is committed to complying wherever possible with the applicable legislation, it also focuses intensively on the overall stability and financial position of the Scheme as a whole and not only individual benefit plans.”