Gloom despite job growth is kicking off ‘vibecession’
says high inflation will hit incoming orders
demandhas
BMW is the first carmaker “to signal cautionon thedemand” Bernstein analystDaniel Roeska said ana note. This implies weakening sentiment today, even as productionramps up across the sector. Theshares slumpedasmuch as6.2% inFrankfurt, themost since March 10.
SAVINGS
The carmaker is also stepping up preparationsfor apotentialgas shortage in Europe.BMW runs 37gas-powered facilitiesthat generate heat and electricity at its factoriesin Germanyand Austria andis consideringturning to local utilities instead. “Shifting energy generation in that magnitude is not trivial and willbe veryexpensive, Zipse said. Healso joinedwarningsby plastics maker Covestro about the effectof atotal gassupply shutdownon thebroadersupplier network. It s not ourdirect suppliers, butthesuppliers ofoursuppliers, those whoseproduction is dependent onprocess gas who are at risk, Zipse said. For them, production will come to a standstill pretty soon if natural gas is completely cut off. /Bloomberg
Scheme committed to quality health care
initiatives, with a particular focus on hospital negotiations, resulted in a savings of R198m,” says Woodhouse. In 2021, Bonitas was selected as the preferred amalgamation partner for Nedbank Medical Aid Scheme (NMAS) a restricted membership medical scheme for Nedbank and Old Mutual employees with 26,283 principal members. The amalgamation, a highlight for the fund, contributed R613m to reserves following the transfer on January 1 2022, says Woodhouse.
continued to impact the health care industry in 2021 and we had to be agile in our response to the dynamic changes within our operating landscape. We had the advantage of learnings from the previous year to guide us when facing difficult decisions, together with our organisational culture and management style that had evolved over the past two years. Despite these challenges, Woodhouse says the fund s strategic focus on connecting with customers ensured it retained members. We had an exceptional start to 2021 when 28,500 new members joined in January. Importantly, 60% of new members were younger than 35, he says.
Bonitas reported an average return of 16.2% CPI +11.5% on its investment portfolio, well above the target of 8.1% (CPI +3.5%). There was significant impact on savings following the collective hospital tariff negotiations in 2020.
Bonitas proactive approach to realigning managed care
Given the significant buildup of reserves in 2020 and the challenging economic circumstances facing its members, Bonitas set historically low premium increases in 2021 without jeopardising the sustainability of the fund. We implemented a competitive weighted average contribution increase of only 1.3% higher than CPI. Under normal circumstances, these are set at a minimum of CPI +3 5% he says. Its medium-term objective is to sustain solvency levels above 30% and to use its bolstered reserves to benefit members, Woodhouse says. As suggested by the Council for Medical Schemes it reinvested R600m of its reserves to reduce the contributions increases for 2022. Hospital costs dominated claims in 2021, reaching R6.45bn, up 9.52% compared to 2020. This, says Woodhouse, is in line with the moratorium on
elective surgeries being lifted. Hospital negotiations, including day hospitals and home-based care, resulted in a saving of R9.5m. Active disease risk management interventions, which focuses on outcomesbased frameworks to improve clinical outcomes, reduce admissions and readmissions and improve medicine adherence, resulted in savings of more than R14m. We expect the pandemic challenges to remain, whether in new waves or new variants. Although the potential impact is unsure, we remain committed to promoting vaccination as an effective countermeasure, says Woodhouse. The fund is confident that it will continue
