The effects of HIV/AIDS on medical schemes in South Africa

With the high level of the HIV epidemic in South Africa, medical schemes continue to be at risk. Risk-management strategies need to take into account that the disease is not notifiable and that there is legislated open enrolment and community rating of contributions, as well as prescribed minimum benefits for HIV/AIDS. As a result, many schemes have introduced HIV disease management and awareness programmes that are aimed at improving the health of HIV-positive beneficiaries and preventing new infections. This paper provides an analysis of current developments in the medical-scheme industry with respect to HIV/AIDS. For a sample of the medical-scheme membership, HIV prevalence estimates are presented with the associated cost effects. This sample is however not necessarily representative of the medical-scheme population. The intention is therefore to develop a methodology for producing indicative results to inform management decisions. The opportunity to lower costs related to HIV/AIDS through proactive risk management is investigated. South African Actuarial Journal Vol. 8 2008: pp. 35-91