Exchange rate crisis hits medical aid companies -Newsday Zimbabwe

ZIMBABWE’s exchange rate crisis, characterized by discrepancies between formal and shadow markets, has hit the country’s medical aid companies, leading to large deficits at the point of care, an official said.

Speaking to NewsDay yesterday, the chief executive of the Association of Healthcare Funders of Zimbabwe (AHFoZ), Shylet Sanyanga, said members’ contributions come from salaries which are assessed differently by service providers. This leaves policyholders at a disadvantage.

Sanyanga said their upcoming stakeholder conference from September 14-17 at the Elephant Hills Hotel in Victoria Falls should address this growing challenge.

“The medical aid contributions come from the wages, the employers’ organizations have not adjusted the wages according to the parallel rate. This means that if medical aid societies try to adjust dues according to the parallel rate, dues-paying members or employer organizations will not be able to afford such frequent adjustments in order to match the parallel rate,” Sanyanga said.

“It would imply that a number of members would prefer to opt out of medical aid. Even employers’ organizations might withdraw their employees from medical aid because it would become unaffordable; this is the dilemma in which we found ourselves.

To pay fees that match what service providers charge, medical aid societies are forced to increase their contributions from members whose salaries are in Zimbabwean dollars and pegged to the official exchange rate, but the service are pursuing the parallel market rate.

” It’s a vicious circle. It is difficult for mutuals to catch up, even if we were to charge the fees that mutuals apply when they reimburse providers, it is practically impossible because of this gap which means that salaries are not adjusted according to of the parallel rate,” Sanyanga added.

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