• 18 Sep 2015

    SpesNews Volume 121

    PMB AT COST AT 2006 RPL + annual CPIX

    This serves as a friendly reminder that comment(s) on the proposed amendments to the regulations to the Medical Schemes Act 131 should be posted within 3 months to

    The Director-General: Health

    Private Bag X828



    The particular Government Gazette applicable is 38990, 14 July 2015(http://www.gov.za/sites/www.gov.za/files/38990_gon603.pdf)

    Both regulation 5 (discharge summary) and regulation 8 (PMBs at cost) are addressed and could mean the additional generation of a comprehensive discharge summary from all the service providers or significant co-payments from patients as some schemes will most likely peg scheme benefits around the 2006 RPL + annual CPIX mark.


    Private healthcare is “wasteful”

    It is almost as common as the corruption permeating the deeper echelons of almost every level of society, but more people are becoming verbose about the unsustainable level of expenditure in the private healthcare environment. Almost all of them conveniently omit the tools the Medical Schemes Act 131 of 1998 and regulations (in their current format) bestow in the hands of the administrator and scheme to manage these costs. One example that was referenced was that Pneumonia costs a certain scheme in excess of R500 million annually, but for the same population an annual flu injection would have brought that figure down significantly – we are talking about a 50% reduction in admissions for members over the age of 65. 50% is R250 million if I could be allowed to put that into perspective. Talk about lack of risk management.

    While some people are moaning about the costs of the specialists (whether direct or indirect costs are referenced), everyone is virtually quiet about the non-healthcare expenditure in some schemes.

    This brings me to the next point: Why are managed care interventions not implemented across the board for all the schemes? Would not implementing the managed care interventions not constitute breach of the King Corporate Governance Principles?

    It really becomes a sad day when we blame the persons responsible for actually saving human life for the costs associated with saving the life or treating a disease. Healthcare professionals are presented with limited options if they wanted to curb costs while simultaneously avoid costly medico-legal mishaps from occurring. These include that they:

    1. Do not treat the patient

    2. Use suboptimal treatment

    3. Avoid technology where possible

    1. Assess the viability of running their own procedure rooms

    1. Consider a global fee type of arrangement to curb costs

      While all of the above remains viable, considerable risks accompany them and unfortunately the specialist would be the sole responsible party should complications be encountered.

    Two factors contributing to huge confusion around medical scheme health, are the current levels of medical aid reserves and the annual medical scheme principal officer reimbursement. Some of these figures have been published recently and appears to be significantly out of sync in a world characterized by purportedly unsustainable private healthcare and severe benefit limitations. Identifying and focussing on specialists as the main driver of healthcare cost in a chain of events where other deficits obviously exists certainly would be presumptuous. Being subjected to an inordinate amount of legislation as litigation against specialists are actively being promoted, amidst strict ethical and corporate governance, where lives literally are at stake, takes a special person to stomach.


    In a welcome outcome, Dr Johan Oelofse (SpesNet) lodged a Medical Schemes Act (131 of 1998) section 48 complaint against Genesis Medical Scheme regarding their refusal to reimburse for biological molecules in the management of a patient with Crohn’s Disease. In a process that was initiated in 2014 and eventually culminating in the appraised verdict, Genesis was instructed by the Council for Medical Schemes to reimburse for the initiation of biological molecules in the treatment of this condition. The argument that the scheme brought forward was that the Medical Schemes Act obligates the scheme to reimburse for PMB’s, aligned with the DTP’s and therapeutic algorithms published by the Minister in the Government Gazette. The biological molecules have not been included on the algorithm for the particular disease. This argument can very easily be countered in that the biological molecules were only registered after 2003 whereas the treatment algorithm was published in 2003. A battalion of other arguments were also submitted by the scheme, but these were adequately addressed in the various responses and communications.

    This victory is hugely lauded, but the whole saga once again placed the spotlight on the regular infringement of consumer rights in the world of private healthcare.


    The annual CMS report (2014/2015) can be obtained from: http://www.medicalschemes.com/files/Annual%20Reports/AR2014_2015.pdf

    Page 147 of the report should be especially interesting since it highlights the fact that the % total healthcare benefits paid to consulting specialists is reflected as exactly the same as that of General Practitioners (2013- 7.0% and 2014- 6.6%). The figure for surgical specialists has been given as even lower (2013 – 5.0% and 2014 – 5.2%). These figures are lower than that of the hospitals, medicines and allied and supplementary health services. Feel free to read this report as it contains numerous other areas of concern.


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