Momentum Health is one of the largest medical aid providers in South Africa, covering more than 100, 000 families and supplying group medical coverage to over 2 ,600 companies. A key factor in Momentum’s success is HealthReturns – a programme that provides monetary rewards for members who look after their health.

The main focus of the HealthReturns programme is to encourage employees to comply with their treatment plans and to be physically active. Physical activity is measured through gym visits, fitness assessments, or by wearing a pedometer (step counter). Based on this, members are allocated one of five HealthReturns reward levels for any particular month. Members can then double these rewards by banking them into a savings account used for healthcare expenses not covered by the medical aid, such as co-payments or cosmetic  surgeries.

The programme recently won scientific credibility through a study showing very successful results. The study focused on just over 70,000 individuals. Some were placed in a test group if they participated in physical activity for at least three months in 2011 (not necessarily consecutive months). The remainder were placed in a control group. After-risk adjustment, the claims experience for the two groups was compared for the following year (2012). The test group exceeded expectations by showing a 26% reduction in claims ratios compared to the control group. Further analysis of the data by claims categories (doctors, hospitals, allied professionals, etc.), showed that this reduction ranged between 20% and 35%.

Comparing chronic claims experience between the two groups revealed that the incidence of chronic claims was 30% lower for the test group, with a 15% lower rate for developing new chronic conditions. In essence, for every ten chronic disease sufferers in the control group, there were only seven in the test group. Finally, chronic claims experience proved to be 23% cheaper in the test group. This is attributed to these healthier members needing lower dosages for their conditions and being better able to respond to lower-cost generic medication.

One could argue that there was a selection effect, in that healthier members, who are generally more active, would end up in the test group and be the major driver of these findings. To test this, a second analysis was done focusing purely on chronic members, again split between a test and a control group. The results were equally impressive: the claims ratio reduction was now 27% (compared to 26% in the first study). It is interesting to note that in this limited sample at least, physical activity had an ever bigger impact on the health of sicker members.

These results illustrate the success of rewarding wellness activities when managing health. Every cent saved is for the medical aid members’ benefit, due to the non-profit structure of private medical aids in South Africa (a regulatory stipulation). The wellness revolution is merely in its infancy, however Momentum is very excited about its future, not only for health insurance, but also for other areas of business.

Momentum is a financial services provider in South Africa offering life and health insurance, institutional and individual investment solutions, pension fund administration, and motor and household insurance.