Health Insurance vs Medical Aid: What Is the Difference?

   

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Health vs medical

Medical insurance and medical aid are two terms that are often confused, and often used to describe the opposite mode of service. But, in truth, these terms are certainly not interchangeable. This is because a medical aid scheme offers some very different benefits from medical insurance.

So, when it comes down to it, what is the difference between medical aid and medical insurance? There are actually several differences. The best way to determine these differences, though, is to highlight the main points of each.

A Look at Health Insurance vs Medical Aid

1. Health Insurance

  • Health insurance schemes are regulated by the Long-Term Insurance Act
  • Health insurance is aimed at health and wellness, like medical aid, but is also in place to protect the policy-holder’s financial assets
  • It covers various disabilities and accidental injuries
  • Health insurance can be used to cover shortfalls in coverage of a regular medical aid scheme
  • In the case of accidental injury or disability, medical insurance can cover the salary of an individual who is rendered unable to work
  • It is possible to consolidate a medical insurance plan with a life insurance policy or funeral cover
  • Medical insurance pays benefits directly to the policy holder, and does so at the stated amount.


2. Medical Aid

  • Medical aid is governed by the Council for Medical Schemes
  • Medical aid ordinarily pays out directly to the beneficiary, be it a hospital or doctor, and does not pay the policy holder
  • Medical aid does not include accident or disability cover, nor does it include cover for the loss of limbs
  • Medical aid pays out according to the National Recommended Price List, which can be as little as a third of the rates charged by healthcare professionals
  • The Medical Aid Scheme is not authorised to include death cover or funeral cover
  • A medical aid is legally bound to the coverage of Prescribed Minimum Benefits
  • Medical insurance pays benefits directly to the policy holder, and does so at the stated amount.


These are the main differences between medical insurance and medical aid. In a nutshell, medical insurance is like insurance for the policy-holder’s health. Essentially, health insurance insures against the policy-holder’s risk of requiring health treatment, and covers the expenses related to this treatment.

Medical aid, on the other hand, is a form of back-up that covers medical treatment (usually in the form of hospitalisation) if it is required. An individual covered by medical aid will not incur the cost of this medical treatment.

Image credit: http://0kp.dromhgg.top/c/confused-face-person/19009196



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