In response to the serious allegations against medical schemes made by SAMA in their recent press release, the Board of Healthcare Funders responds as follows:
In the interest of the consumer, it is of utmost importance that there is mutual trust between funders and healthcare providers. BHF is therefore concerned that there appears to be a lack of communication and understanding between the two parties, leading to the allegations made by SAMA.
The operations of medical schemes are very strictly controlled by the Council for Medical Schemes. Medical schemes are essentially ‘stokvels’ where member premiums are collected and then paid out to those who need it. According to the Medical Schemes Act, medical schemes must be governed by a board of Trustees, elected by the membership and are not permitted to make a profit. Trustee remuneration is usually disclosed to members of the scheme at the AGM where members have an opportunity to voice their opinions and make the changes they require.
Non-healthcare costs and the profits made by medical scheme administrators are tightly controlled by the CMS and are reported on in the CMS Annual Report.
Unlike most other essential services, such as water and electricity which are subject to regulated tariffs, there are no regulated tariffs or price lists of charges for private healthcare professionals and facilities. This has lead, in some cases, to opportunistic charges by health professionals as there are no restrictions on the fees that health service providers can charge. This causes medical scheme premiums to rise and sometimes results in medical schemes having to apply co-payments for their members in order to protect the remaining members from unnecessary increases.
Like water and electricity, healthcare is not a commodity and is not discretionary. Therefore, the lack of a tariff is unfair to members since consumers are often ill and vulnerable at the point of service and not in a position to negotiate with the healthcare provider. The information asymmetry that exists within the healthcare environment and the shortage of specialists also contribute to escalation of costs in the environment.
On the issue of the public sector doctors performing limited work in the private sector: Those providers who fall into the category of ‘Remunerated Work outside the Public Service’ (RWOPs) are required to obtain formal agreement from the Department of Health before they are permitted to work in the private sector. Medical schemes would be acting unlawfully should they reimburse for the services of a public sector provider who does not have the necessary agreements in place.
The BHF would like to invite representatives of SAMA to engage on the issues which it raises in its press statement.