• 18 Dec 2014

    SpesNews Vol 112


    The BHF tendered a document to the Competition Commissioner detailing areas it identified as being restrictive in terms of access to healthcare and inefficient processes within the healthcare system. Its submission centers around a comprehensive review of current legislation and the belief that the healthcare market is unlike any other market due to the following reasons:

    • Asymmetry of Information
    • Provider-induced demand
    • Unique pricing mechanism

    The BHF is of firm belief that the regulation of prices in addition to other regulatory controls should play an integral part in the protection of patients as well as the affordability of services and products. It further called for measures to counter private hospital consolidation and prices specialists can charge for their services.

    Other areas of concerns raised by the document were the unbundling of codes (to extract greater reimbursement for services rendered) by the specialists in addition to a request for amendments to the Medical Schemes Act. This is requested in a bid to control the ability of the Council for Medical Schemes (CMS) and the Registrar to prevent their attempts to regulate by Circular.

    Hospital Cash Plans (HCPs) were also mentioned as these were seen as products that in some cases operated in competition with medical scheme products but enjoyed an unfair playing field advantage. It highlights the belief that the industry literature indicates a higher probability of hospital admissions as well as a longer hospital length of stay when compared to the treatment of similar conditions under normal medical scheme benefits.

    The BHF believes that the National Health Act and Section 27 of the SA Constitution empower the Minister of Health sufficiently with the ability to affect the requested changes.


    In an unrelated article on the same subject, it appears as if the Department of Health is considering amending the controversial regulation 8 that compels medical schemes to reimburse healthcare providers for the services they render in full (or at cost). These services are specifically centered on the treatment for the PMB conditions. The main gripe medical schemes have against the regulation is that reimbursement is mandated in full, regardless of what the healthcare professional charges.

    Some of the schemes are of opinion that the regulation be set aside on the grounds that it:

    • is ultra vires (beyond the law)
    • extends beyond what is contemplated by the law
    • is irrational
    • is unconstitutional

    The problem regarding the payment of accounts for services delivered in the management of PMB conditions, basically boils down to the following:

    • There are no guideline tariffs for medical services after the nullification of the Reference Price List in 2010
    • In some instances, evidence was found that opportunistic billing occurs (schemes are charged more for the management of PMB conditions)
    • The Department is of opinion that co-payments in the event of the treatment for PMB conditions, should not be allowed

    Should the Department decide to go ahead with the amendment of regulation 8, a draft will be published for comment probably after February 2015. The public will have to be allowed to comment prior to any amendment to the regulation is undertaken.

    SpesNet advises practices to make a concerted effort to assess and comment on the draft as and when it becomes available.


    Looking back at a very eventful and exciting year it once again became extremely apparent that time waits for no one. Practices are once again faced with the prospect of preparing for 2015 in a pro-active and decisive way. After reviewing the queries forwarded through to SpesNet in the beginning of 2014, SpesNet would like to recommend the following:

     1. Please read the various payment arrangements you have signed throughout the year again. Pay specific attention to the detail regarding tariff increases and patient base.

     2. Ensure that the benefit option that made a significant impact when your practice entered into a payment arrangement still remains beneficial to the practice. Sometimes a benefit is scrapped or merged into another option – this could have a massive impact on the income of a practice.

     3. Ensure that you understand the actions that is required (if any) should you decide that the practice will continue with a payment arrangement. Do you inform the scheme that you continue, resign a document or is it an automatic renewal with you accepting the tariff increases from the scheme by default?

     4. Pay specific attention to % changes in reimbursement, patient base and the reasons for initially entering into a payment arrangement (or not). Do this still count and/or are they still applicable?

     5. Review your practice billing policy. The assistance of a good accountant could make the world of a difference in the long run. Here SpesNet would like to reiterate that the billing policy should and must always be consistent. Inconsistent billing policies have the habit of biting us in the future. Especially with the Competition Commission Enquiry under way, this becomes a vital factor to employ correctly.

     6. Confirm with the vendor of your practice management system and/or claims submission system that the systems will be geared in the beginning of 2015 to operate with the minimal of hassles, especially with regard to medical scheme member validation and benefit option tariff.


    Amidst the turmoil of the festive season, the shopping and to-do lists, SpesNet would like to wish all our practices a blessed, safe Christmas and a sensational 2015.We trust that around this time of year, your relationships with your loved ones are rekindled anew and that new horizons beckon filled with opportunity and success. Have an abundant Christmas.

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