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Latest survey shows SA medical schemes are starting to bounce back

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Customer Satisfaction and Loyalty of Medical Scheme Members beginning to bounce back after Covid

South African medical schemes are starting to bounce back when it comes to measuring the gap between what customers expect and what they perceive to receive in return for their premium and loyalty.  After losing ground during the past three tough Covid years, there’s a slight bounce back for the first time since 2019.

But medical schemes are not yet out of the woods. After last year’s dramatic drop to a six-year low the industry has some ground to recover. The good news is that there has been an increase in perceived value by members over the last 12 months.  Yet one of the emerging challenges is the need for the industry to improve the way complaints are handled. While medical schemes on the whole showed the first decrease in complaints in five years, the incidence of complaints in 2022 is high at 15% in comparison to the international best practice score which is below 10%.

These are just some of the findings in the latest South African Customer Satisfaction Index (SA-csi) for Medical Schemes 2022 conducted by Consulta, which provides scientific insights into the overall satisfaction of members of South Africa’s largest open medical scheme providers (by membership numbers) – Bestmed, Bonitas, Discovery and Medihelp. GEMS is the only closed medical scheme included in the survey. Consulta polled 3950 medical scheme members during the third and fourth quarter of 2022 and have announced that Bestmed emerges as the leader on overall customer satisfaction for the third year running, with all other schemes performing on, or below industry par in the 2022 index.

Abigail Boikhutso, Group Chief Executive at Consulta, explains: “Essentially the industry has levelled back to ground zero. During the pandemic, medical schemes were caught in the eye of the storm in a difficult and unsettled period where household incomes were impacted and job and financial security were in the balance. In line with this, consumer price tolerance was low and requirements may not have been perceived to have been met by members. It follows that a high rate of complaints would have a marked negative impact on customer satisfaction scores.  Now that we’ve come through the worst of Covid the industry has experienced a slight increase in perceived value by members.  However, the benchmark is low and this positive bounce is in reality, taking medical schemes back to where they were in 2019.

The industry is normalising

The strongest gauge in the Customer Satisfaction Index Model is “Customer Expectation”

because it measures customer anticipation of the quality of a company’s service. This includes non-experiential information like advertising and word of mouth, as well as a forecast of the company’s ability to deliver quality in the future. The 2022 study shows that the industry is normalising back to the relevant range of between 80.1 – 82.2.  Boikhutso explains that this range contrasts with the notably high 2020 industry expectation of 85.0, which could be linked to the Covid-19 pandemic as customers expected more from their medical aid schemes to assist them during that period. Only Bestmed and Discovery exceeded the industry benchmark in 2022. Moving forward, the challenge to meet expectations is further complicated for medical schemes by the difference in cost and benefits between the different options being offered on the market.

“It is encouraging to see that the Expectation-Quality Gap is closing in 2022 at 1.8 from 2.8 in 2021, and 2.0 in 2020. All medical schemes, apart from Bonitas, showed an increase in customer satisfaction scores compared with 2021,” says Boikhutso. “After reporting a six-year low in customer satisfaction and loyalty last year, these positive indicators are good for both the customers and the industry on the whole and the start of a bigger bounce back over the next 12 months.

Key take-outs from the SA-csi for Medical Schemes for 2022:

Customer Satisfaction – Overall Index

Customer Expectations and Perceived Quality

Perceived Value

Complaints Incidence and Handling

Customer Loyalty

Net Promoter Score

Treating Customers Fairly (TCF)

As a strategic tool for gauging individual firms’ competitiveness and predicting future profitability, an organisation’s customer satisfaction performance, as measured by the SA-csi methodology, provides a predictive indication of how well the firm will perform in terms of future revenue and earnings growth. Supported by both the scientific and practitioner community, the SA-csi is the first independent, comprehensive national customer satisfaction index with international comparability in South Africa. It has collected data from more than 450 000 consumers since its inception in 2012. The SA-csi forms part of a global network of research groups, quality associations, and universities that have adopted the American Customer Satisfaction Index (ACSI) methodology via its Global CSISM program.

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