Cancer is one of the greatest challenges the world faces today. Discovery Health’s data shows that cancer cases increased by over 45% between 2011 and 2018, with almost 8 500 new cases in 2018 alone.
As a result, Discovery Health Medical Scheme has seen an increase of over 100% in the costs of cancer-related treatment, from R1.5bn in 2011 to over R3.5bn in 2018.
New cancer medicine, including biologics and immunotherapy, shows great potential to save or extend lives, but comes at an extremely high cost.
The increasing incidence of cancer and the rapidly rising costs of treatment pose a serious challenge for health funders worldwide. Governments and private health insurers need to give patients access to new cancer medicine, while at the same time making sure that the costs do not undermine the long-term sustainability of the system.
Challenge of funding expensive medicine
In South Africa, medical schemes must accept all applicants, regardless of their health history. Medical schemes have a strong social solidarity mandate to provide access to world-class private healthcare and to reduce the burden on the public sector, even for new members with serious health conditions.
However, 80% of healthcare costs happen in the last two years of a person’s life. If people can join medical schemes only when they are sick, they will tend not to join when they are healthy, which threatens the sustainability of medical schemes. As medical schemes operate as not-for-profit legal entities owned by their members, they cannot access external capital – claims paid out each year have to be covered in full by premiums paid in by members.
In response to this challenge, the Council for Medical Schemes has regulated a set of cancer benefits that all members have access to, giving them an appropriate and affordable level of coverage for cancer treatment. But it doesn’t cover the more expensive treatments they may need.
Cancer cover through medical scheme benefits
An alternative approach is to provide access to high-cost cancer medicine on a selected number of plans within a medical scheme, and to sustain this higher cost by charging higher premiums for these plans – a path Discovery Health Medical Scheme has chosen.
This solution provides an excellent baseline level of cover across all plans, well in excess of the minimum level prescribed by the regulations. Discovery Health Medical Scheme also offers an Innovation Cancer Benefit on its Executive and Comprehensive Plans which provides funding for a defined list of high-cost cancer medicine.
The issue of high medicine prices is of great interest to funders and governments worldwide, and it is critical that all stakeholders work with the pharmaceutical industry to make medicine more affordable and accessible for those in need.
*Dr Jonathan Broomberg, CEO Discovery Health
** Article supplied by Discovery Health
Discovery Health Medical Scheme is an independent non-profit entity governed by the Medical Schemes Act and regulated by the Council for Medical Schemes. It is administered by a separate company, Discovery Health (Pty) Ltd, an authorised financial services provider.