Medical aid claims in a recession

A tough economic climate can directly affect our health, reducing well-being and raising the demands on businesses and our healthcare system. RISKAFRICA takes an in-depth look how this affects medical aids and what they are doing to help mitigate the risks of an ailing nation.

Past research has suggested that when times are hard, human health tends to improve as people are pushed away from indulgences like fast foods, drinking and smoking in order to cut back on expenditure. A case in point would be the Great Depression of 1929 – 1933, where despite unemployment in America rising to almost 25 per cent, life expectancy rose and deaths from heart disease, flu, cancer and car crashes fell. Fast-forward eight decades and circumstances are completely the opposite, with more recent international research focusing on the public health effect of economic crises and alternative policy responses in Europe suggesting that for every 1 per cent increase in the unemployment rate, there is a 0.78 per cent increase in the rate of suicide, especially for those under the age of 65.

There is also an alarming association between major depression and an economic crisis, prevalent in the majority of European countries grappling with an economic downturn. Since 2011, it was 2.6 times more likely for Greeks to undergo major depression, for example, compared to in 2008, when the most severe debt crises in Greece’s history since began.

Mental health remains a critical concern as research shows it also tends to increase within tough economic times. The Insight Research Group reported that 77 per cent of general practitioners in the UK feel there has been an increase in new cases of mental health conditions in the last four years directly linked to the economic climate.

South Africa’s rising unemployment rates and constant flirtations with recession brings with its fair share of health scares as well. “Economic troubles often lead to stress and anxiety, which can have a destructive effect on health and heart health in particular,” says Dr Bobby Ramasia from Bonitas. The medical aid has noted a significant increase in serious ailments in South Africa, worsened by financial stress, such as high blood pressure, diabetes, asthma, cancer, eating disorders and gastrointestinal problems such as stomach ulcers, insomnia, psoriasis and substance abuse.

“Short-term stress-related spikes in your blood pressure, added up over time, may put you at risk of developing long-term high blood pressure, which increases your risk of developing heart conditions,” explains Ramasia. Aside from the heart, an increasing prevalence of chronic diseases is also a major cause for concern, with Ramasia explaining that they have seen an increase of 19.6 per cent in hypertension cases, 7.64 per cent for diabetes, 7 per cent for asthma and 6.7 per cent for depression among their member base since 2014.

“A high percentage of members are also registered for co-morbid conditions, which is when one or more additional diseases co-occur with a primary condition, particularly hypertension, diabetes and ischaemic heart conditions,” continues Ramasia.    

Yet, although the pressure on medical aids substantially increases during an economic downturn, this is by no means an entirely new pressure. A downward slump in the economy simply exacerbates existing issues that have been affecting a nation. Claims statistics from Liberty Medical Scheme, for example, show that, regardless of the economic status, men are significantly more at risk for heart-related conditions than women. 

Another perfect example is the ‘sitting is the new smoking’ slogan, which was coined by Dr James Levine, director of the Mayo Clinic-Arizona State University Obesity Solutions Initiative. Levine has been studying the adverse effects of the increasingly sedentary lifestyles of people, especially in developing countries like America, and the phrase came about because, according to him, sitting is more dangerous than smoking, kills more people than HIV and is more treacherous than parachuting.


Other researchers have found and continue to find evidence that prolonged sitting increases the risk of developing several serious illnesses like various types of cancer, heart disease and type 2 diabetes; meaning that the majority of us are probably sitting ourselves to death already. Additional stress, be it the loss of a job or concern about the financial status of the country, simply causes these symptoms to worsen or develop into more serious ailments.

The ‘sitting is the new smoking’ phrase is just one of the reasons why medical aids are actively trying to mitigate health risks of their members. Just fewer than eight million South Africans belong to a medical aid scheme, the majority of which actively encourage their members to be fit, healthy and active through incentivised programmes. Discovery is a market leader when it comes to motivating and rewarding their members to stay healthy through their Vitality loyalty programme, while Bestmed Medical Scheme has championed the Just Rewards programme and Bonitas has recently introduced their wellness extender benefits in a bid to curtail the prevalence of chronic conditions and help keep members healthier.

Whilst initiatives that encourage an active labour market, which keep and reintegrate workers in jobs, provide for a stronger currency and create better fiscal confidences could mitigate some adverse health effects of economic downturns, it is important to remember that financial woes tend not to be limited to unemployment; and being employed can still have as detrimental an effect as being unemployed. “Research shows that job security is not necessarily a good thing as it can still result in a massive amount of financial uncertainty,” explains Chris Luyt, executive of marketing and sales at Bestmed. “This, in turn, can have a direct impact on the health of individuals; those who are in particularly high-end positions may not face the imminent risk of being fired or retrenched,  however, there is still financial uncertainty and this can cause mental, emotional and physical stresses. Often this uncertainty is associated with people borrowing more money to lead a certain type of lifestyle, for example, and this can be linked to financial stresses. It is, therefore, imperative that medical aids contribute substantially to discipline spending, especially in the household budget, to ensure that everyone benefits.”

Luyt reiterates the need for a proactive approach from both medical aids and members by explaining that “more than half of deaths are related to non-communicable diseases, which are chronic diseases that can be reversed or decreased with a change of lifestyle, an increase in exercise and lowering  stress levels. These positive changes can have a direct impact not only on the health of individuals but also to businesses, and shows that medical aids can play a significant role to increase the business’s bottom line.”