Renaissance strengthens position as a leading medical aid fund
In what has proven to be a difficult year for medical aid funds, Renaissance Health managed to grow its membership by 21% during 2011. Net growth in a fund’s membership is a key indicator of client approval as it reflects both the number of new members joining the fund, as well as those exiting. Member profile is equally important and the stellar growth has seen a positive shift to a younger mean age and generally healthier individuals. This contributed in no small measure to the fund’s overall positive results, despite a decline of almost 50% in the net surplus. As an indication of the fund’s financial depth, it is significant that it maintains a reserve institutional investment with Sanlam Namibia and Allan Gray Namibia which exceeded N$55 million at the end of the financial year. The conservative investment mandate protects the interest of members while ensuring capital preservation.
The Renaissance Health Medical Aid Fund is regarded by both its members auditors, actuaries and the regulator, as financially sound and one of the leaders a leader in the provision of medical aid cover. The fund enjoys a healthy solvency and reserve ratio well in excess of the minimum regulatory requirements as prescribed by NAMFISA, the Namibia Financial Institutions Supervisory Authority. This sound financial position gives members complete peace of mind that their claims will be paid fully and on time. During 2009, 2010 and 2011 more than N$31 million in reserves were added. Renaissance has to submit monthly reports to Namfisa to test and monitor compliance. The fund follows a stipulated Good Governance framework with all information readily available to all members while service providers have to subscribe to Best Business Practice through a transparent tendering process.
“Our reviews indicate that the Fund has maintained a healthy financial position over the last 6 years, with reserves of between 25% and 30% of annual contributions maintained for the last 3 years. Membership also has shown significant growth during the last 3 years” said Johan Human, an Associate Actuary with ARCH Actuarial Consulting.
The sustainability of the financial position of the Fund is protected by the use of independent appointed actuaries on an ongoing basis to review the Funds’ financial performance, service, and variables and report to Trustees.
Renaissance Health’s membership growth has been superior in comparison to the rest of the medical aid funds industry. While the rest of the market has grown marginally at about 2% in 2011, Renaissance Health has managed to grow by 21%. Renaissance Health has the best national footprint and spread of members, both in terms of demography and geography.
The performance of a medical aid can be measured by the ability to attract new clients, and keep the existing clients. However, the sustainability of every member’s benefits should be guaranteed, and a wide variety of products and options must be available at all times at competitive pricing in the market.
The ability of a medical aid administrator to keep up the service infrastructure, and supply an administration that is up to standard is just as important. That is why an annual survey is requested by the Board of Trustees by an external independent company, where a test group of up to 600 doctors, other medical aid companies and members to test the funds’ benefits and service levels.
Value for Money
Renaissance Health’s pricing model keeps up with increases in medical costs to ensure the most efficient cost/benefit structure to its members. Over the years, Renaissance Health’s pricing have been kept well below industry standard, and with a strong operational performance in 2011, there is no need to recover losses from previous years, ensuring the cost structuring for 2012 remains well within budget and still competitive at all times.
Administrative Ability and Infrastructure
As the fund’s administrator, Prosperity Health has to, on a daily basis, rub shoulders with members, employers, health professionals, and corporate clients. Therefore, Prosperity Health has created a national presence with service offices in Windhoek (head office and two branches), Lüderitz, Rosh Pinah, Oranjemund, Tsumeb, Swakopmund, Walvis Bay, Oshakati and recently Rundu.
In addition to the administrative services, Renaissance Health provides financial assistance for travel expenses incurred to obtain medical treatment which is not available at point of residence. Also, the SADC emergency benefit provides cover for emergency evacuation and repatriation in Namibia and from SADC countries back to Namibia and South Africa when it is medically appropriate. Direct admission to private hospitals in the event of a medical emergency when travelling or working outside Namibia is guaranteed. This includes assistance with the transportation of mortal remains from the place of death to the place of burial within Namibia.
The international medical emergency benefit -covers risk in case of an emergency outside of Namibia and overseas to the value of N$10 million per person.