It's the perfect time to reflect on one of the most crucial aspects of financial wellbeing that women often overlook – healthcare financial planning. While healthcare planning is important for everyone, women face unique challenges and circumstances that make strategic health financing not just beneficial, but essential.
The Gender Gap in Healthcare Financial Planning
“Women, generally, navigate a complex landscape when it comes to healthcare and finances. Statistics reveal a stark reality: women typically live longer than men but often earn less throughout their careers. This combination creates a perfect storm of financial vulnerability, particularly during retirement years when healthcare needs typically increase, while earning capacity is potentially compromised. The longer life expectancy that women enjoy also comes with increased financial demands. More years of life often translate to more years of potential healthcare expenses, making the need for comprehensive healthcare financial planning even more critical.
Unfortunately, in South Africa, the alternatives to private healthcare are not an option. When you factor in that women are also more likely to take career breaks or forego career advancement due to caregiving responsibilities – whether for raising children or ageing parents – the income gaps become even more pronounced,” explains Martin Rimmer, CEO of Sirago Underwriting Managers, a gap cover provider underwritten by GENRIC Insurance.
Understanding the Unique Health Risks
Women face specific health risks that require targeted financial preparation. Breast, ovarian, and cervical cancers disproportionately affect women, and these conditions can result in significant medical expenses and potential loss of income, as a result of long layoffs during treatment. Additionally, women are more susceptible to certain chronic conditions, including autoimmune diseases, musculoskeletal conditions and cardiovascular disease – all of which come with significant treatment costs. These health realities underscore the importance of having the right healthcare coverage that addresses women's specific needs.
Building Your Healthcare Financial Foundation
#1: Medical Scheme Coverage: Your Primary Defence
Given South Africa's challenging and deteriorating public healthcare landscape and the high costs of private medical care, medical scheme coverage isn't optional – it's non-negotiable. However, choosing the right medical scheme requires careful consideration of your specific circumstances. “Working with an accredited healthcare broker who can analyse your current healthcare expenditure, family medical history, and any pre-existing conditions can go a far way to ensuring the correct balance in making a personal choice. Remember, the cheapest option is hardly ever the most cost-effective or benefit-specific, if it leaves you exposed to significant out-of-pocket expenses or exclusions when you need care most,” says Rimmer.
#2: Gap Cover: Protecting Against the Unexpected
Gap cover serves as your financial safety net, covering the shortfall between what medical schemes pay and what specialists actually charge, primarily for in-hospital events. This difference can be substantial – specialists and hospital charges can be up to 500% more than what medical scheme benefits pay. “If your medical scheme pays 200% of tariff but your specialist charges 500%, you're personally liable for that 300% difference. Sirago’s recent gap claims data shows average “large gap claims” now sits between R40,000 and R60,000 – amounts that could seriously impact your cashflow and financial stability without proper gap cover protection,” explains Rimmer.
#3: Comprehensive Crisis Planning
A serious health diagnosis can impact more than just your physical wellbeing – it can devastate your financial situation and lifestyle. Cancer treatment, for example, might prevent you from working for months, eliminating your income precisely when medical expenses are highest. For stay-at-home mothers, the financial impact extends beyond lost income. The caregiving responsibilities you handle – from childcare to eldercare – carry significant financial value. If you become unable to fulfil these roles, the cost of replacement care and support can be substantial. Explore insurance solutions including income protection insurance, disability and critical illness insurance which can provide financial breathing room when you need to focus on recovery rather than financial survival.
#4: Prevention, Prevention, Prevention
Regular Preventative Care is a drum that simply cannot be beaten loudly enough and medical schemes often make these benefits available to members! Commit to annual preventative health screenings because early detection of potential health issues can dramatically reduce both the health and financial consequences of serious conditions. Ensure your healthcare plan covers essential preventive care including mammograms, pap smears, bone density tests and cardiovascular screenings. Again, this is where your healthcare advisor can play an instrumental role in helping you manage your healthcare strategy.
#5: Reproductive and Maternity Planning
If you're planning to expand your family, prioritise comprehensive maternity and reproductive health coverage. Childbirth costs can be substantial, and complications can multiply expenses exponentially. Look for coverage that includes comprehensive prenatal care, delivery and hospitalisation, and postnatal care for both mother and baby. Medical scheme maternity programmes, when adhered to, can really help you manage your health and additional finances during these periods.
#6: Lifestyle as Financial Strategy
Small, consistent lifestyle changes can yield significant health and financial returns. Maintain a balanced, nutritious diet, exercise regularly, even if just for a few minutes daily; limit alcohol consumption; eliminate smoking/vaping; prioritise stress management and mental wellbeing and get adequate sleep. These preventive measures can help avoid costly chronic conditions down the line and reduce your long-term healthcare expenses.
#7: Maximise Available Resources
If you have access to group employee benefits, leverage them. Group plans typically offer better rates due to collective buying power. However, ensure your individual and employer-provided benefits work together cohesively without unnecessary gaps or duplications.
#8: Professional Advice
The complexity of healthcare financial planning makes professional guidance invaluable. A qualified healthcare advisor can help you to assess your current healthcare coverage gaps, understand potential out-of-pocket costs, plan for self-funding shortfalls, balance affordability with comprehensive coverage and navigate the often complex interplay between different insurance products.
“Make healthcare financial planning your priority. The unique challenges women face – from income disparities to specific health risks to longer life expectancy – require strategic, thoughtful planning. Don't let financial constraints force you into choosing between immediate needs and future health security. With proper planning, professional guidance, and the right insurance portfolio, you can build a robust financial foundation that supports both your current wellbeing and long-term health security.
Healthcare financial planning isn't just about managing expenses when you're sick – it's about creating the financial freedom to prioritise your health and wellbeing throughout your life,” concludes Rimmer.
Book that consultation with a qualified, professional healthcare and financial advisor to develop a plan that meets your specific needs and budget – and revisit it every year or sooner if circumstances demand it. Your future self will thank you.