Many employers include medical aid cover as part of your remuneration package for a job position but it is important to understand what is meant by company medical aid. It is not mandatory for South African employers to provide medical aid for their workers but given the high cost of medical aid membership, many companies include it as an additional perk.
You have the right to refuse membership if you so wish but this does not mean that you will get extra money as part of the employers subsidy for the monthly premiums. However, if you truly value the health and welfare of yourself and your family, you will take the opportunity to join a medical aid be it through your company or on your own. It is a matter of affordability though but the medical aid benefits for the year in the end often outweigh the costs.
For Company Employees Only
In the true sense of the term, a company medical aid is a restricted scheme and eligibility for membership is only open to workers of the company in question. However, not every South African company can offer a restricted medical aid cover for its employees only. For example, SAB Medical Aid for SAB employees or Sasolmed for Sasol employees. Sometimes many companies in the same industry band together to offer their employees membership to an industry exclusive medical aid. For example Motohealth for workers in the motor industry or Fish Med for the fishing industry worker.
Medical Aid Subsidy by the Employer
At other times, your employer may allow you to join an open medical aid and pay a portion of your monthly contributions. This subsidy may be restricted to only certain open medical aids or your employer may be flexible and allow you to join any scheme of your choice. The subsidy is also given to company medical aids where membership is only open to workers of that employer or workers in a specific industry.
The subsidy can vary and its entirely your employer’s prerogative as to how much they will pay as part of the subsidy. Some employers will pay only 30%, others will cover half the monthly contributions (50%) while a few very generous companies pay as much as two-third (66%) of the worker’s monthly contributions. Remember that you are still liable for paying the remainder of the monthly premium out of your own pocket.
Medical Aid as Part of Cost to Company (CTC)
Sometimes the medical aid subsidy is part of the cost to company (CTC) amount offered in your salary package. This means that your employer will only pay contributions for your medical aid that does not exceed the CTC figure agreed upon when you accepted the job. No extra money will be paid by the employer and ultimately this affects your take home salary (net salary).
There may be some tax benefit to you and ultimately you are having the protection of medical aid cover so it is not a loss as such. However, it is important to remember that when you see a job offer where medical aid is part of the CTC amount then you cannot expect the employer to fork out any more money on a subsidy for a company medical aid.