| Mon 6 Aug 2001, 0:00 | | African Life Acquires 100% Of Ingwe Hpo |
|
African Life, the listed financial services group, has bought out the
minorities in Ingwe Health Plan Organisation, with effect from 1 August
2001.
Jeremy Rowse, chief executive of African Life, says, "Given that our primary
revenue streams come from individual financial services, healthcare and our
international operations, acquiring 100% of Ingwe makes business sense. The
acquisition is a strong vote of confidence in Ingwe's future and reflects
the considerable progress Ingwe has made in two years in establishing itself
as one of the leading managed healthcare service providers in the emerging
market."
Rowse points out that key management remains in place and appropriately
incentivised, and that the Ingwe brand will be retained. He says the
acquisition gives Ingwe further access to the significant resources of
African Life. "Ingwe can now make more efficient use of African Life's
proven networks and distribution channels. The synergies we anticipated are
already emerging. In addition to the largely untapped South African market,
Ingwe can now also look to replicate its proven model in other African
regions where our company has already established operations."
Ingwe HPO is the acknowledged market leader in fourth-generation capitation
products. It offers a full range of affordable healthcare products and
services to the emerging market. Its flagship product, Ingwe Health Plan
pioneered managed capitation plans in South Africa and costs from just R250
per month. Capitation plans involve the scheme paying a monthly fee upfront
to the medial practitioner (instead of a fee per consultation) for tending
to any of the scheme's members. This approach offers affordable benefits for
members with considerably reduced administration costs for the medical aid
administrator.
Dr Peter Botha, managing director of Ingwe HPO, says the transaction is a
decisive step towards meeting ambitious targets. "We are confident of
attaining our goal of aggressive member base growth this financial year, and
of doubling that growth in three years."
Dr Botha says that Ingwe's success in a very competitive market rests on its
in-depth understanding of the needs of the emerging market. "This has
enabled us to design products that are comprehensive but affordable. Most
importantly, the product design is linked to managed care processes that
control utilisation in healthcare delivery systems. Ingwe is currently the
only medical scheme with the ability to manage more than one capitated
network of primary care providers."
"Against a background of spiralling medical inflation - and predictions that
medical aid contributions will swallow 30% of salary by 2009 - Ingwe has
prioritised sustainable value for money. For the average family, Ingwe costs
about a quarter of the price of traditional medical aid cover. For this
contribution, members receive comprehensive primary healthcare, R500 000 in
hospital cover and six specialist visits a year."
Ingwe has successfully grown its principal membership base over the last two
years by using a bottom-up approach to sell to employees of large employer
groups. Dr Botha says, "This approach complements the drive by trade unions
to enhance social benefits for their members. In many cases, employers
subsidise 50% of the contribution, so employees end up paying even less per
month for essential affordable care."
Dr Botha says that, with the support of African Life, Ingwe is planning for
strong, sustainable, growth.
Ends
For further information, contact:
Dr Peter Botha 011-315-3852 083-326-9564
Jeremy Rowse 011-359-7701 083-272-8375
Andre van Heerden 011-359-7703 083-611-1306
