Medshield AGM reveals scheme is well-positioned to care for members
Members can rest assured that the medical scheme is financially secure and able to settle their claims, says Alan Fritz, acting principal officer
At Medshield Medical Scheme’s 53rd AGM held on June 30, Alan Fritz, acting principal officer, said Medshield had to embrace the heightened responsibility to serve their members' healthcare needs during 2021. But despite the challenges, he said Medshield sustained its stable financial position and achieved an excellent solvency ratio and credit rating.
2021 notable highlights
For the 15th consecutive year, the Global Credit Ratings Agency recognised Medshield's sound financial position by awarding it with an AA rating with a stable outlook — the third-highest rating in the country.
The scheme's solvency ratio at the end of the financial year was 57.4%, which is more than twice the statutory minimum of 25% as prescribed by regulation 29 of the Medical Schemes Act 131 of 1998. This improved solvency ratio reflects the scheme's solid claims-paying ability.
Medshield's governance structures continued to function efficiently and effectively during 2021, with the board of trustees and various committees continuously monitoring and evaluating the work implemented by the scheme’s executive management team.
The scheme's membership growth suffered slightly in the harsh economic environment experienced by all South Africans.
Though it did not meet its membership growth target, Medshield said it is encouraged that the average age of new lives joining the scheme has decreased. The scheme's demographics are improving and contributing positively to its financial position.
Medshield's principal officer and executive management team will continue implementing strategic objectives for sustainable membership growth.
Medshield also became an authorised financial service provider (FSP) in May 2021, unlocking opportunities for the scheme to compete on an even playing field and to better inform its members and potential members of the scheme's benefits when compared to competitors.
In addition, with new waves of the pandemic ravaging SA in 2021, the scheme focused on protecting members through vaccinations, with 99,698 members being vaccinated at a cost of R33m. An additional R77.44m was spent on testing costs.
Medshield is for the people
Medshield’s sound financial performance is for the benefit of its members. The scheme is a not-for-profit organisation and exists purely for its members and the value it brings to them.
“The monthly contributions members pay are pooled into a trust fund used to pay for the healthcare claims of members according to the scheme rules and their particular choice of plan or benefit option. In addition, Medshield is also self-administered, so we don't pay substantial administration fees to a third party. Any surplus funds are transferred to the scheme's reserves to mitigate risk during rainy days or healthcare pandemics,” said Fritz.
Technology has a significant role in the healthcare sector ... we are constantly evolving by deploying useful digital tools and service channels via the Medshield app and websiteAlan Fritz, Medshield's acting principal officer
Amid all the challenges encountered during this period, Medshield managed to be certified as a Top Employer in 2022 by the Top Employer Institute for the second time. This recognition highlights the scheme's investment in world-class people practices — something that benefits members directly through Medshield's member-centric service model.
“Technology has a significant role in the healthcare sector, and in addition to the virtual access to doctors and various innovative tools implemented during the height of the pandemic, we are constantly evolving by deploying useful digital tools and service channels via the Medshield app and website,” said Fritz.
A continued focus on member value
“We are proud to say that we ended the 2021 year on a more financially sound footing than we started, and that we are able to continue to meet our obligations to members,” said Fritz.
“The constrained economic environment due to the impact of Covid-19 will further strain membership affordability, growth and retention into 2022. But members can rest assured that Medshield will continue to provide member value through our various benefit options, and that we are financially secure and able to settle their claims.
“The extra value and benefits offered through our wellness benefits and loyalty programme are also sure to alleviate some of the financial strain our members are now experiencing.”
This article was paid for by Medshield Medical Scheme.