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SUB CATEGORIES General  |  HIV |  Medical Schemes | 

Who manages?

14 May 2004 Angelo Coppola

This is the second part of a two part series on the main issues raised by the annual report from the Registrar for Medical Schemes.

Andre Meyer, the CEO of Medscheme, answers the third question, raised by the Registrar of Medical Schem

Who manages these costs?

Meyer says it is the trustees of each medical scheme who determine what their non-healthcare costs will be. 

Competition in the administration market allows them to determine the value proposition of each of these services.  If the trustees do not like their offering, they can (and do) change administrators, managed care organizations, marketing channel, etc.

It is a fact of life that administrators and other non-healthcare cost organizations work for profit.  However, so does every GP, dentist, hospital or pharmaceutical manufacturer. 

In fact, it is only the medical scheme itself which does not pay profits to shareholders, under the law.

It is widely agreed that unnecessary costs in healthcare should be minimized, and certainly all costs (including administration) deserve close scrutiny to ensure that member’s interests are protected.

However, if an investment in administration or “management” can result in improvements in the quality of healthcare, or curtailment of wastage and abuse, them additional expenditure can be justified.

Key to success in this area would be a better alignment of the interests of the various stakeholders towards the benefit of the patient and consumer.

Quick Polls

QUESTION

There are countless articles written about South Africa’s poor retirement outcomes. Which of the following would you single out as the biggest contributor to local savers not accumulating enough to buy an adequate and sustainable pension?

ANSWER

Lack of personal accountability
Poor participation in formal retirement funds
Reluctance to seek financial advice early on
SA’s high unemployment rate
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