Initial cancer claim volumes have spiked 631% over the past two years, analysis shows

15 May 2023

The figure is a damning confirmation of the warnings issued by healthcare providers and medical schemes that the reluctance to go to hospitals and doctors during the Covid-19 pandemic would result in more cancer diagnoses in the years ahead.

An analysis undertaken by Sirago Underwriting Managers over the past two years shows that the initial cancer diagnosis claims volume increased by 631% in 2021/22, compared with the two years before — 2019 and 2020. Cancer co-payment benefits were up by 201% over the same period and the total volume of cancer claims increased by 281%.

These figures are a damning confirmation of the warnings issued by healthcare providers and medical schemes that the reluctance to go to hospitals and doctors during the Covid-19 pandemic would result in more cancer diagnoses in the years ahead.

Just last week, Liberty confirmed that cancer was the leading cause of medical claims for both males and females over the past year. When breaking down cancer as the primary cause of claims, breast cancer accounted for 49% of cancer-related claims for women, highlighting the need for regular preventative check-ups such as pap smears and mammograms, and the need for women to have adequate cover, specifically for the diagnosis of a critical illness. In men, prostate cancer accounted for 31.5% of all approved cancer claims.

As part of the benefits package on certain options, Sirago’s “Initial Cancer Diagnosis” benefit provides a lump sum payment upon the initial diagnosis of malignant cancer. This is intended to be used to fund the costs of diagnostic investigations such as PET scans, MRIs, biopsies and blood tests, on which medical schemes may impose co-payments or sub-limits, as well as immediate access to medication requirements while members are still registering their treatment plans with their medical schemes.

Cancer co-pay claims volumes increased by 201%. Sirago’s co-pay benefit is applied once the medical scheme cancer benefit sub-limit has been reached and a co-payment is required. This gap cover benefit incorporates co-payments for ongoing cancer-related treatments and biological drugs until the next full treatment cycle is reinstated by the medical scheme.

Martin Rimmer, the chief executive of Sirago, says the sharp increase in cancer-related gap claims is profoundly concerning on two fronts.

“First, this shows just how massively prevalent cancer is in our society and lifestyles, especially when you consider that the dramatic increase of 601% relates only to first-time diagnosis of malignant cancer in the last two years,” he says.

Anecdotally, Sirago points to the aftermath of the impact that Covid-19 had on preventative healthcare when the early diagnoses of chronic diseases like cancer simply collapsed. Preventative, annual health checks by South Africans took a long time to recover and are still not at pre-pandemic levels as expected.

Rimmer adds that affordability and the commensurate buy-down in medical scheme benefits by consumers play a big role in this move away from preventative health checks.

“The cancer co-payment claims relate specifically to the shortfalls that medical scheme members face for in-hospital cancer treatment once their limits are reached on their medical scheme options for the applicable cycle and that they would need to fund out of their own pockets if they did not have gap cover in place as a supplementary cover to their medical scheme benefit,” he says.

Wellth Fund

At least one medical scheme has taken the issue seriously. The country’s largest medical scheme, Discovery Health, has stepped up with a Wellth Fund to drive preventative health screenings among its members.

At the launch in January this year, chief executive Dr Ryan Noach confirmed that screening rates among members were worryingly below pre-pandemic rates. General health checks were down by 50%, mammograms by 15%, pap smears by 12 % and prostate cancer screening checks by 10%.

“The time has come to focus our attention on reversing this trend,” he said. “When it comes to diseases such as cancer or any form of chronic illness, early detection is fundamental to limiting serious complications and reducing costs in the long term. Our data confirms that on average, a person diagnosed at the age of 40 with an early-stage breast cancer has a three times higher likelihood of surviving for five years post-diagnosis.”

The Wellth Fund gives all Discovery Health Medical scheme members once-off access to as much as R10,000 per family for an expanded range of screening and preventative healthcare to be used over the next two years. Noach says this is the best possible use of the scheme’s excess solvency reserves, noting that the decision is economically astute, since an improvement in members’ health means a long-term and lasting reduction in claims, with a ninefold return on investment for funding the screening and preventive healthcare offered through the fund.

Affordability challenges

Rimmer adds that the trend is worrying because many cancer diagnoses are likely to be at much later stages of detection, which has a profound impact on patients in terms of the success and cost of their treatment.

The sharp increase in co-payment claims is also firmly rooted in the affordability challenges that South Africans face in the current economic climate.

“Many consumers have been forced to buy down on their medical scheme benefits to ‘core plans’, which in turn means access to potentially lower benefits and exposure to possibly more self-funding of their healthcare treatment to come from their own pockets,” explains Rimmer.

“A late diagnosis could ultimately mean more complex health interventions with more invasive, aggressive, costly, and lengthy treatment and recovery time. We’re seeing evidence of this with a sharp uptick in ‘mega’ gap claims related to cancer — these are internally classified as claims of R50,000 and above for shortfalls or co-payments not paid by medical schemes,” he says.

Although medical schemes do cover the cost of Prescribed Minimum Benefits (PMBs) and cancer treatments at cost, this does not mean that all diagnosed cancers are automatically a PMB benefit.

Rimmer says each scheme has its own rules and protocols for diagnosing and managing PMBs and if the cancer detected does not form part of the PMB basket, members will most certainly be exposed to out-of-pocket expenses during their treatment.

Some medical schemes might also only fund certain treatments, like biologicals, partially, if at all.

“Many core plans also do not fund any of the diagnostic tests such as MRI and PET scans,” Rimmer warns. An MRI scan at a hospital in South Africa costs about R3,000, while a CT scan will cost between R1,500 and R2,200. DM/BM

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