The medical aid fund industry reported a net surplus in 2017 and remained well capitalised, the 2017 Namibia Financial Institutions Supervisory Authority (Namfisa) annual report has revealed.
The industry’s reserves level exceeded the minimum prudential reserves level requirement of 25 percent, and thus deemed to be financially sound.
The industry reported an operational surplus (the result after deducting healthcare and non-healthcare costs from net contributions before investment and other income) of N$95.4 million for 2017, a desirable turnaround from the N$5.5 million deficit in 2016.
The number of beneficiaries increased by 2.6 percent to 195,419 as at 31 December 2017.
“The growth rate has stabilised as it hovered at approximately 3 percent per year from 2013 through 2017, indicating that the Namibian medical aid funds market had somewhat matured.
“The marginal growth in open funds is expected in a mature industry where there are relatively fewer innovative, affordable products available to the uncovered, usually low income population, currently without medical aid cover.”
The number of dependents increased by 5.4 percent to 106,165 and principal members increased by 3 percent to 89,254 during the 2017 financial year.
Namfisa said gross contributions received increased by 14.1 percent to N$3.8 billion for the 2017 financial year.
“Contributions were thus sufficient to settle healthcare expenditure, with excess funds available to cover non-healthcare expenses and contribute to building reserves,” Namfisa added.
The industry’s average contribution increase matched the average inflation of 6.2 percent for 2017.
In terms of claims, hospital claims were the highest at N$1.2 billion, followed by pharmacy (medicine) at N$512 million, and specialist claims paid which amounted to N$377 million.
Total industry assets increased by 22.3 percent to N$1.8 billion. The growth in total assets was attributable to capitalised investment gains and to the reinvestment of a portion of the net surplus of N$223.7 million in 2017.
The industry reported total liabilities of N$412 million.