affordable & practicalcourse of 2019, once certain changes have been made to the medical schemes...

INTERSYSTEMS | PROFILE INTERSYSTEMS | PROFILE

11DOH 2018

HEALTHYLIFESTYLES

AFFORDABLE &PRACTICAL

AFFORDABLEFAMILY OPTIONS

12 DOH 2018

INTERSYSTEMS | PROFILEDAY1 HEALTH | SPONSOR’S MESSAGE

T he end of 2017 ushered in

a new era for healthcare

in South Africa. The health

demarcation debate that

has persisted for almost two decades

between the long- and short-term

insurers and the Council for Medical

Schemes (CMS) came to an end.

Day1 Health was granted full

exemption to continue providing

low-cost hybrid (primary healthcare

and hospital cover) health insurance

products that it originally designed

and introduced to the market many

years ago, prior to the design of a

Low-Cost Benefit Option medical

scheme framework, which the CMS

intends on introducing during the

course of 2019, once certain changes

have been made to the Medical

Schemes Act (No. 131 of 1998), in

the build-up to National Health

Insurance (NHI).

Contrary to scepticism, Day1 Health’s

funding model has proven over the

years that it is possible to deliver

private healthcare cover, unlimited

day-to-day benefits for as little as

R8.70 per day and, for an additional

R4.00 extra per day, adequate private

hospital treatment may be included

too, inclusive of VAT and reasonable

broker commissions.

With this in mind, and with the

support of labour, which Day1

Health enjoys, it is our purpose to

persuade employers in both the

private and public sectors to fund

or, at the very least, co-fund the

minimal costs associated with our

products, as alluded to above, thereby

making healthcare a condition

of employment.

The aforementioned costs are fully

tax-deductible in terms of Section

11A of the Income Tax Act (No. 58 of

1962) and are, in any event, negligible

in comparison to the increased output

and productivity levels that would

naturally ensue as a result of

a reduction in absenteeism from

the workplace by implementing

this measure.

Furthermore, if it were mandatory

for employers to contribute to the

well-being of their staff members,

an enormous burden would be

removed from the State, in that the

State’s primary responsibility would

then only need to focus on the very

vulnerable and unemployed sectors

of society, bringing NHI within

closer reach.

Similarly, many grossly unfair labour

practices still exist in certain sectors,

such as in the municipal sector, where

vested interests ensure that only

high-income earners have access

to medical cover, which, indirectly,

has put huge pressure on our State

healthcare facilities. These practices

should now be stopped, as they are at

variance with not only Section 27 of

the Constitution, but Section 18 of the

Bill of Rights – that being, the right to

freedom of association.

From a practical perspective, South

Africa has a long way to go before

NHI may come into effect, given the

current state of our economy. We

must not, however, underestimate the

resilience and resolution of the ruling

party; with its new president-elect,

the resurgence of our economy is

still possible.

The Department of Health has

many challenges ahead but, once

all bad elements have been taken

care of, with determination and

fortitude, State hospital facilities can

be sanitised and rebuilt. When this

transpires, citizens will begin to gain

confidence in the State’s ability to

deliver quality healthcare, which is an

absolute prerequisite for its success.

With regard to corruption, a zero-

tolerance policy needs to be adopted

– as Botswana has successfully done.

Following that, confidence in the

economy will re-emerge, bringing

with it sustainable GDP growth and

paving the way for a more equitable

distribution of health provision for

the entire country, as is contemplated

with the roll-out of NHI.

CEO, Day1 Health

A NEW ERA FOR

in South Africahealthcare

Richard M Blackman

Richard M Blackman, CEO, Day1 Health


13DOH 2018

Day1 Health’s mission, as a low-cost benefit

option product provider, is closely aligned with

Section 27 of the South African Constitution,

which states that it is everyone’s fundamental

human right to be able to access

quality healthcare.

The rising sunin healthcare

DAY1 HEALTH | MAIN SPONSOR

who cannot

afford medical aid.

The country’s tax brackets are

indicative of the fact that the majority

of its citizens are relatively poor and

since the cost of medical aid increases

the higher an individual’s income,

many would rather abstain from

obtaining medical aid cover. Day1

Health’s solution, however, bucks the

medical aid trends by demystifying

the cost of delivering quality

healthcare. The company’s premiums

remain highly competitive and, in

certain instances, have not increased

in the last nine years, proving that,

in spite of the hospital claims it

TABLE 1 Summary from the Healthcare Consumer Survey 2016

REASON FOR LEAVING MEDICAL SCHEME PERCENTAGE

No longer affordable 41.0I/my partner changed jobs 11.6I/my partner became unemployed 11.2Not good value for money 5.6Was on my parents’ medical scheme but then left home 9.3

I wanted to stay but my medical scheme terminated my membership 3.0

Was a member through an employer, but contributions became unaffordable after changing employment 13.1

Have no dependants and, therefore, not concerned about healthcare needs 1.9

Was excluded from being a member due to health status 0.4

Other 3.0

T he year 2003 saw

Day1 Health (Pty) Ltd

pioneer the first hybrid

medical insurance product,

combining both primary healthcare

and hospital plan benefits, which

was made available to consumers

as a more affordable alternative to

traditional medical aid schemes.

“We, at Day1 Health, are, and have

always been, an affordable healthcare

provider from the day we started

16 years ago. Day1 Health was up

against the might of medical schemes

simply because issues always existed

around insurance-based schemes,

some of which, sadly,

historically declined both

the elderly and the sick,”

shares Richard Blackman,

CEO, Day1 Health. “Our

good reputation is, however,

the driving force behind our

business. We ensure that all of our

customers are treated fairly and I

believe this was an important factor

in Day1 Health recently being granted

full demarcation exemption status

from the Council for Medical

Schemes (CMS).”

Over the decades, access to quality

private healthcare has become

unobtainable, driven to a point where

only the privileged few can afford

conventional medical aid

cover. An estimated 8.8

million South Africans are

covered by medical aid – a

figure that has remained

static for some time

because people cannot

afford the cost associated

thereto. A huge gap exists

in the market to service the

almost 7 million employed people

13DOH 2018

Note: The 21% of survey respondents who were no longer a member of medical aid, even though they were at some point, were asked why they left. The results, as per above, reveal that 41% left their medical aid scheme because it was no longer affordable. This was followed by 13% who were members through an employer, but contributions became unaffordable after changing employment.

14 DOH 2018

INTERSYSTEMS | PROFILE

43

has had to pay,

Day1 Health still

manages to make a marginal profit.

Package offeringDay1 Health offers the following

healthcare and assistance services:

primary healthcare cover, hospital

illness cover, illness top-up cover,

maternity cover, accident/trauma

cover, dread disease cover, disability

cover, funeral cover, employee wellness

programmes, emergency medical

services and GAP cover, with unlimited

primary healthcare packages starting

from as little as R265 per month (see

Table 2). “Our mission from day one has

been to overcome the segregation that

exists between medical aids and the

everyday consumer. Medical aids are

clearly not designed for the working

class; they’re not designed for the

poor,” Blackman continues.

“Day1 Health is different. As a result of

cross subsidisation, we are able to offer

one price for all patients, regardless of

income bracket. While other companies

have copied our approach, no one

can offer what we do. Since achieving

demarcation exemption from the

CMS in November 2017, Day1 Health

is on the launch pad! The exemption

serves as a mandate from the CMS and,

indeed, the National Department of

Health, giving Day1 Health the rights to

negotiate with the likes of specialists

and other important stakeholders in

the private healthcare system. ”

The day-to-day benefits of the

plans, as outlined in Table 2, cover

prepaid preventative healthcare via

1Doctor Health (Pty) Ltd. On the Day1

Health plans, doctor consultations

are unlimited, but managed, via

the 1Doctor Health Network; acute

and chronic medication is covered

according to the 1Doctor

Health formulary; basic

dentistry treatment, such as

preventative cleaning, pain

control, fillings, extractions

and one emergency root

canal treatment, is covered as per the

1Doctor Health dentistry protocols;

basic diagnostic blood tests are

covered on referral by a 1Doctor Health

Network GP; basic radiology is covered

according to the 1Doctor Health

formulary via a 1Doctor Network GP;

and eye test and prescription glasses

are covered as per the Spec-Savers

agreed protocol range.

“During our journey, we developed

a marvellous relationship with private

practitioners nationwide, recognising

the importance of controlling our own

GP and dental network. We are happy

to report that Day1 Health has a very

stable, established network of doctors

and dentists. By employing our own

GPs, we are able to control spiralling

inflation and keep our prices to a

minimum, as far as is possible,

so that the State can focus

primarily on the very poor,

and very vulnerable, in terms of their

healthcare needs,” reiterates Blackman.

In the event that a Day1 Health patient

cannot see a Network GP, he/she is

allowed three out-of-area visits per

family per annum to an alternative

Network GP or a GP of his/her choice,

subject to Day1 Health’s terms and

conditions.

While Day1 Health’s stated hospital

benefits may not cover all 270 life-

threatening Prescribed Minimum

Benefits (PMBs) at 100% of medical aid

rates, the limits set in respect of these

hospital benefits are such that they

cover any individual for at least 70%

of all health events. Blackman states,

“In my humble opinion, it is important

to continue to cover PMBs in terms of

the MSA in order to ensure that our

doctors and specialists remain in South

Africa. It is also, however, imperative to

formulate and implement a low-cost

benefit option for those people on

marginal incomes who cannot afford

the ever-increasing costs associated

with medical aid schemes.”

Wellness programmeIn addition to its healthcare packages,

Day1 Health offers a wellness

programme, available on request to

employer groups only. A minimum of

35 members per annum are required

to activate this option. Day1 Health has

an association with Health IQ, which

performs basic wellness screening

for conditions such as diabetes,

hypertension,


21Introducing a new Primary Healthcare and Indemnity Hospital product to specifically cater for the needs of the elderly.

Successfully contracting with all Life Healthcare hospital facilities nationwide.

Negotiating discounted rates with private specialists to avoid patient co-payments.

The launching of the Day1 Health Clinic adjacent to Garden City.


Some of the Day1 Health initiatives include:

Good to know


15DOH 2018


TABLE 2 The various Day1 Health products

DESCRIPTION OF DAY1 HEALTH’S HEALTHCARE PRODUCTS

Day to Day Plan (R265 per month)

Primary healthcare benefits:• Unlimited but managed doctor visits (network GPs and out-of-area visits)• Medication (acute)• Medication (chronic)• Radiology (basic black and white X-rays)• Pathology (basic diagnostic blood tests)• Dentistry (basic)• Optometry• Specialists (R500 per annum)• Family funeral benefit (adult – R10 000; child – R5 000; R2 500 and R1 250)

Value Plus Plan (R385 per month)

Primary healthcare benefits:• As per Day to Day PlanHospitalisation benefits:• In-hospital illness (day 1 – R10 000; day 2 – R10 000; day 3 – R10 000; subsequent days –

R1 500; maximum benefit – R57 000)• Maternity cover (R20 000)• Accident/trauma benefit (R150 000 per member; R300 000 per family)• Death benefit (R10 000 per principal member)• Family funeral benefit (adult – R10 000; child – R5 000; R2 500 and R1 250)• 24-hour emergency services and hospital pre-authorisation

Platinum Plan (R645 per month)

Primary healthcare benefits:• As per Day to Day PlanHospitalisation benefits:• In-hospital illness (day 1 – R10 000; day 2 – R10 000; day 3 – R10 000; subsequent days –

R1 500; maximum benefit – R57 000)• Maternity cover (R20 000)• Accident/trauma benefit (R150 000 per member; R300 000 per family)• Dread disease (R250 000, limited to R50 000 prior to medical examination)• Accidental permanent total disability benefit (R250 000)• Death benefit (R10 000 per principal member)• Family funeral benefit (adult – R10 000; child – R5 000; R2 500 and R1 250), optional• 24-hour emergency services and hospital pre-authorisation

Executive Plan (R760 per month)

Primary healthcare benefits:• As per Day to Day Plan• Specialists (R1 000 per annum)Hospitalisation benefits:• In-hospital illness (day 1 – R10 000; day 2 – R10 000; day 3 – R10 000; subsequent days –

R2 000; maximum benefit – R66 000)• Illness top-up (2 events per annum of R25 000 per incident per family)• Maternity cover (R20 000)• Accident/trauma benefit (R250 000 per member; R500 000 per family)• Dread disease (R250 000, limited to R50 000 prior to medical examination)• Accidental permanent total disability benefit (R250 000)• Death benefit (R20 000 each for principal member and spouse)• Family funeral benefit (adult – R10 000; child – R5 000; R2 500 and R1 250), optional• 24-hour emergency services and hospital pre-authorisation

Senior Comprehensive Plan (R525 per month)

Primary healthcare benefits:• As per Day to Day Plan• No specialist benefitHospitalisation benefits:• In-hospital illness (day 1 – R10 000; day 2 – R10 000; day 3 – R10 000; subsequent days –

R1 500; maximum benefit – R57 000)• Accident/trauma benefit (R75 000 per member; R150 000 per family)• Death benefit (R5 000 each for principal member and spouse)• 24-hour emergency services and hospital pre-authorisation

15DOH 2018

16 DOH 2018


effective, low-cost benefit option,”

he adds. “Ultimately, our aim is to

alleviate pressures on State facilities. If

we have the proper funding in place,

Day1 Health can explore the option

of introducing mobile clinics into its

stable further down the line.”

The company’s main aim is

development and growth: as it grows,

Day1 Health will establish a series of

clinics in each province, employ its

own GPs, incentivise them to help

run the clinics, and have the clinics

become administration centres,

thereby adopting a decentralised

model. “Our first clinic opened in

Mayfair, Johannesburg, and will

become a healthcare centre of

excellence,” says Crisp. Situated next

to the Netcare Garden City Hospital in

the heart of Mayfair, this pioneer Day1

Health Clinic stands proudly on the

main road, allowing easy access for

Day1 Health members.

The opening of this clinic allows

Day1 Health to offer far more allied

healthcare services than traditionally

covered by the company’s Primary

Healthcare Policy, including X-rays,

ultrasounds, blood tests, in-house

optometry, dentistry, a wound care

clinic, unlimited GP visits, physiotherapy,

psychology and specialist physician

care. Additionally, the facility houses

a weight-loss clinic that is available at

significantly discounted rates to Day1

Health members who have higher than

normal BMIs.

Paul Desvaux de Marigny, CFO, Day1

Health, explains, “It is important to

note that the entire administration

platform for Day1 Health is enrolled

on Day1 Health’s system – a practice

management system that enables

seamless integration between health

management organisations, health

insurance companies and service

providers in their day-to-day efforts

to manage patients and their clinical

needs. The system keeps an electronic

record of every single consultation

with a particular healthcare

practitioner and, in so doing, enhances

the relationship between doctor

and patient.”

Day1 Health’s system is key to its

monitoring needs as it helps mitigate

risk. “If a patient goes over a certain

number of GP visits, for example, the

system will flag it. This allows us to

monitor and find out the reason for

a patient’s excess doctor visits. In the

same way, we can monitor GP statistics

and mitigate against fraud. Ultimately,

this helps us keep prices low for the

benefit of our members,” Desvaux de

Marigny continues.


Eastern Cape 69Free State 69Gauteng 297Kwazulu-Natal 177Limpopo 52Mpumalanga 60North West 54Northern Cape 21Western Cape 139Total 938

General practitioners

1DOCTOR HEALTH NETWORK

obesity, high cholesterol and

metabolic syndrome. Members

identified as suffering from one of

the abovementioned conditions

are then acutely monitored on a

real-time basis via a revolutionary

application, thus minimising the

need to go to hospital.

Health clinics“The more Day1 Health can drive

down healthcare costs – e.g. the

cost of anaesthetists, hospital

beds and so forth – the more it

can control its operating costs,

thereby enhancing the value

of its healthcare benefits

for its clients,” explains

Jason Crisp, Risk and Legal

Adviser, Day1 Health.

“This approach is crucial

in assisting the CMS in

formulating a cost-


17DOH 2018

Additionally, Crisp says that Day1

Health’s business model assists in

curbing any potential market abuse in

the healthcare insurance industry by

paying the private healthcare facilities

and other medical expenses directly

to the various service providers. This

is done via letters of authority signed

by its members, as opposed to paying

the members themselves, thereby

defraying the latter’s actual medical

expenses incurred.

National Health InsuranceDay1 Health has it pinned down when

it comes to providing low-cost medical

options for the average South African,

while mitigating risk against abuse.

And, the company is also in support

of the proposed National Health

Insurance (NHI).

NHI is government’s response to

achieving universal health coverage

for all South Africans, with specific

reference to financial health coverage.

It aims to provide equity and solidarity

through the pooling of risks and funds,

thereby creating a unified public

health fund equipped with adequate

resources to plan for, and effectively

meet, the health needs of every citizen.

“I was privy to seeing a George

Washington University debate live

on CNN in February 2017 between

senators Bernie Sanders and Ted Cruz

regarding the future of Obamacare

and whether there are any merits to

its implementation,” shares Blackman.

“I noticed similarities between the

concept of Obamacare in the USA and

the proposed NHI system for South

Africa. Even though the US is the

largest and most powerful economy


in the world, it, too, experiences

similar problems.”

The aim of NHI is not to do away with

private healthcare providers; they will

just be required to operate under a

different environment. Section 27(3) of

the Constitution will be strictly applied

under NHI, which states that nobody

may be refused emergency medical

treatment. Under NHI, for example,

private providers (e.g. private hospitals)

will not be allowed to charge patients

a co-payment after NHI has paid them,

as is currently the case. Furthermore, a

healthcare provider will not be allowed

to start treating a patient and then

send him/her away after that patient’s

medical savings have been depleted.

NHI will cover services that are

delivered on a people-centred

integrated healthcare services platform

to ensure a more responsive and

accountable health system that takes

into account socio-cultural and socio-

economic factors. This will contribute

Eastern Cape 23Free State 29Gauteng 209Kwazulu-Natal 106Limpopo 26Mpumalanga 29North West 24Northern Cape 10Western Cape 126Total 582

Dentists1DOCTOR HEALTH NETWORK

towards improved human capital,

labour productivity, economic growth,

social stability and social cohesion.

While private healthcare providers will

continue to operate, the healthcare

system under NHI will be reorganised

to strengthen primary healthcare

(PHC), including PHC re-engineering,

hospital services and emergency

medical services.

“For years, the State has been

struggling to take care of the health

needs of over 42 million South Africans,

placing strain on the public healthcare

system. It is reassuring to note,

however, that the labour market

has shown a significant interest in

the benefits that Day1 Health’s

products provide. We, at Day1

Health, hope to use this support

as a springboard to enrol as

many medically uncovered

lives as possible,” Blackman

concludes.

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