Having medical aid can provide valuable access to private healthcare, but it does not always mean that every medical bill will be paid in full. Specialists and other healthcare professionals may charge more than the tariff your medical scheme agrees to reimburse, leaving you responsible for the difference.
This unpaid portion is known as a medical expense shortfall—and it can amount to thousands of rand after a hospital procedure. Gap cover is designed to help protect medical-scheme members against certain qualifying shortfalls, co-payments and unexpected in-hospital expenses.
What Is Gap Cover?
Gap cover is a separate insurance policy that works alongside your medical aid. It is intended to cover certain differences between what an eligible healthcare provider charges for treatment and what your medical scheme pays.
For example, a specialist may charge 300% of the medical-scheme tariff while your scheme option only reimburses claims at 100% of that tariff. The unpaid 200% could become your personal responsibility. Depending on the terms and limits of the gap-cover policy, some or all of this qualifying shortfall may be covered.
Gap cover may also provide benefits for defined medical-scheme co-payments on certain hospital admissions or procedures. However, the exact benefits differ between insurers and policies.
Medical Aid and Gap Cover Are Not the Same
Medical aid and gap cover serve different purposes.
A medical scheme pays qualifying healthcare expenses according to the registered scheme’s rules, benefits, tariffs, networks and limits. Medical schemes must also provide Prescribed Minimum Benefits, subject to the applicable legislation and scheme requirements.
Gap cover is an insurance policy designed to supplement medical-scheme membership. It does not provide the broad healthcare benefits of medical aid and should not be viewed as an alternative to joining a medical scheme. The Council for Medical Schemes distinguishes medical schemes from health-insurance policies, while gap-cover policies generally require the insured person to belong to a medical scheme.
In simple terms:
Medical aid pays the qualifying medical claim according to the scheme’s rules. Gap cover may help pay a qualifying shortfall left behind.
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Why Do Medical-Aid Shortfalls Occur?
Medical schemes reimburse healthcare providers according to defined tariffs. However, private specialists are not necessarily required to charge the same tariff.
A surgeon, anaesthetist or other medical practitioner may charge a multiple of the medical-scheme tariff. When the practitioner’s fee exceeds the amount paid by the scheme, the member may receive an account for the outstanding balance.
Shortfalls may also arise because of:
- Co-payments imposed by a medical scheme
- Deductibles for certain procedures
- Use of providers outside the scheme’s network
- Treatment that is excluded from the member’s plan
- Benefit limits that have been reached
- Failure to obtain the required pre-authorisation
- Claims that do not meet the insurer’s policy conditions
Not every unpaid medical bill qualifies for gap-cover reimbursement. The reason for the medical scheme’s non-payment is therefore important.
How Gap Cover Works
Suppose a medical specialist charges R30,000 for an eligible hospital procedure, but your medical scheme reimburses only R12,000.
This leaves a shortfall of R18,000.
After the medical scheme processes the claim, you may submit the relevant statements and supporting documents to your gap-cover insurer. The insurer will assess whether the event qualifies under the policy. Where approved, the benefit will be paid according to the policy’s tariff percentage, exclusions, annual limits and other conditions.
Gap cover does not automatically settle every difference between a provider’s account and a medical scheme’s payment. The claim must fall within the policy’s insured benefits.
What Can Gap Cover Include?
Benefits vary between providers, but a gap-cover policy may include some of the following:
Specialist Tariff Shortfalls
This benefit may cover qualifying differences between the medical-scheme tariff and the fee charged by a specialist for in-hospital treatment.
Some products advertise cover of several times the medical-scheme tariff, but a higher percentage does not necessarily mean that every claim will be paid in full. Policy definitions and monetary limits still apply. Hippo notes that certain products may provide cover of up to 500% above the applicable medical-aid rate.
Medical-Scheme Co-Payments
Medical schemes may require members to pay a fixed amount for certain hospital admissions, scans or procedures.
Some gap-cover policies reimburse defined co-payments, provided the procedure and circumstances meet the policy’s conditions. Voluntary use of a non-network hospital or provider may not necessarily qualify.
Cancer-Related Shortfalls
Certain products provide additional benefits for qualifying oncology shortfalls or medical-scheme co-payments.
Cancer benefits often have specific definitions, limits and waiting periods. Members should not assume that all cancer treatment or medication will be covered.
Casualty or Emergency Benefits
Some gap-cover policies include benefits for qualifying emergency or casualty-room treatment.
This benefit may be subject to limits and may apply only after an accident or under defined emergency circumstances.
Internal Prostheses
Certain policies may contribute towards qualifying shortfalls for internal prostheses used during surgery, such as joint replacements, cardiac devices or other approved medical devices.
The policy may restrict the types of prostheses covered and impose sub-limits.
Accidental Death or Disability Benefits
Some gap-cover products offer additional lump-sum benefits following accidental death or permanent disability. These are supplementary insurance benefits and are not the primary purpose of gap cover.
What Gap Cover May Not Pay
Understanding exclusions is just as important as understanding benefits.
Depending on the policy, gap cover may not cover:
- Routine GP visits outside hospital
- Ordinary dental or optometry expenses
- Day-to-day medication
- Treatment excluded by the medical scheme
- Procedures not authorised by the medical scheme
- Voluntary use of non-network providers
- Cosmetic or elective procedures
- Claims arising during a waiting period
- Pre-existing conditions during an applicable exclusion period
- Amounts exceeding annual or benefit-specific limits
- Expenses that do not result from an eligible medical-scheme shortfall
A rejected medical-aid claim does not automatically become a valid gap-cover claim. If the medical scheme pays nothing because the procedure is excluded or the member failed to follow its rules, the gap insurer may also reject the claim.
Waiting Periods and Pre-Existing Conditions
Gap-cover insurers may impose general waiting periods, condition-specific waiting periods or exclusions for pre-existing medical conditions.
Hippo states that waiting-period provisions differ between insurers and notes that pre-existing conditions may be excluded for 12 months after a policy begins. The actual terms depend on the selected policy and insurer.
This means gap cover should ideally be considered before a planned procedure or serious diagnosis arises. Applying after treatment has already been recommended may result in the condition being excluded.
Always disclose health information accurately and read the policy schedule before accepting cover.
Who Can Apply for Gap Cover?
Gap cover is generally available to people who already belong to a registered medical scheme. Some products cover an individual, while others allow a principal member and qualifying family members to be insured under one policy.
The definition of a family and the maximum number of insured dependants may differ between insurers. Some policies require every person covered by the gap policy to be registered as a dependant on a medical scheme.
Gap cover is therefore generally unsuitable for someone who does not have medical aid.
Is Gap Cover Worth Having?
Gap cover may be valuable where a household would struggle to fund a large unexpected medical shortfall from savings.
Consider the following example:
A family has medical aid and an emergency fund of R40,000. After an unexpected hospital admission, the family receives specialist shortfall accounts totalling R35,000. Paying these bills personally would consume most of the household’s emergency savings.
A suitable gap-cover policy could reduce this financial disruption if the expenses qualify under the policy.
From a financial-planning perspective, gap cover can help protect:
- Emergency savings
- Monthly cash flow
- Investments intended for long-term goals
- Retirement contributions
- Access to credit
- The family’s ability to manage other financial responsibilities
However, value depends on the policy’s premium, benefits, exclusions and suitability for your medical-scheme option.
Gap Cover and Prescribed Minimum Benefits
Prescribed Minimum Benefits are minimum healthcare benefits that registered medical schemes must provide for defined emergencies, medical conditions and chronic diseases.
Where PMB rules apply, the medical scheme may be required to fund qualifying treatment in full if the member follows the scheme’s protocols and uses its designated service providers.
A member who voluntarily chooses a non-designated provider may still face a co-payment, depending on the circumstances and scheme rules. Gap cover should not be used as a reason to ignore medical-scheme networks, authorisation procedures or PMB processes.
Before submitting a gap-cover claim, establish whether the underlying account should first be reconsidered by the medical scheme as a possible PMB claim.
How to Choose Gap Cover
Do not compare policies using the advertised tariff percentage alone. A policy offering a high percentage may still contain restrictive limits or exclusions.
Compare the following:
Cover Percentage
Check the maximum multiple of the medical-scheme tariff covered and determine whether your medical aid already provides 100%, 200% or another reimbursement level.
Co-Payment Benefits
Identify which medical-scheme co-payments qualify and which are specifically excluded.
Annual Limits
Gap-cover benefits are normally subject to annual limits. Hippo notes that limits vary between insurers, making it important to compare the monetary protection rather than only the headline percentage.
Sub-Limits
A policy may have separate limits for oncology, scans, casualty visits, internal prostheses or other benefits.
Waiting Periods
Confirm the general and condition-specific waiting periods before cancelling or replacing an existing policy.
Age Restrictions
Some insurers apply entry-age limits or higher premiums for older members.
Family Definition
Check whether one premium covers the entire family and whether adult dependants, students or extended family members qualify.
Claims Process
Establish which documents are required, how long you have to submit a claim and whether benefits are paid to the policyholder or healthcare provider.
Exclusions
Read the full exclusion list. This is where you will find the circumstances in which a seemingly valid shortfall may not be paid.
Questions to Ask Before Buying Gap Cover
Before selecting a policy, ask:
- Must every insured person belong to the same medical scheme?
- What percentage of the medical-scheme tariff does the policy cover?
- Which co-payments are included?
- What are the annual and benefit-specific limits?
- Are oncology and internal-prosthesis shortfalls covered?
- What waiting periods apply?
- How are pre-existing conditions treated?
- Are non-network penalties excluded?
- What documents will be required when claiming?
- Does the cover remain suitable if I change my medical-aid option?
Comparing Gap-Cover Quotes
Hippo provides a comparison process through which consumers can enter their information, receive quotations from participating insurers and compare available plans before selecting a provider. Hippo describes its service as free to use and says its insurer partners are licensed insurers and financial-services providers.
A comparison platform can make the initial research easier, but the lowest premium should not be the only deciding factor. The policy must be assessed against your medical-aid option, family composition, healthcare risks and ability to absorb uncovered expenses.
Final Thoughts
Medical aid remains the foundation of private healthcare funding, but it may not settle every specialist account in full. Gap cover can provide an additional layer of financial protection by helping with certain qualifying medical-scheme shortfalls and co-payments.
The right policy should complement your specific medical-aid plan rather than duplicate benefits or create a false impression that every medical expense is covered.
Before choosing gap cover, compare the tariff percentage, annual limit, co-payment benefits, waiting periods, exclusions and claims process. Most importantly, continue following your medical scheme’s network, authorisation and treatment requirements.
Healthcare planning is not only about getting treatment when you need it. It is also about ensuring that an unexpected hospital event does not undo years of responsible financial planning.
Disclaimer: This article provides general educational information and does not constitute personalised financial, medical, insurance or medical-scheme advice. Benefits, premiums, limits, waiting periods and policy conditions differ between providers and may change. Review the latest policy wording and consult an appropriately authorised financial adviser before making a decision.
