The medical scheme regulator says it has submitted its long-awaited report on cheap, pared down medical scheme options to health minister Joe Phaala.
The Council for Medical Schemes (CMS) has since 2015 been overseeing the development of a low-cost benefit option (LCBO) framework that will allow schemes to offer cheap primary healthcare cover. This requires exempting schemes from Medical Schemes Act requirements that they must provide cover for a much broader range of services, known as prescribed minimum benefits.
The report may have far-reaching implications for the medical schemes sector as millions of people who cannot afford medical scheme membership could benefit from LCBO products, reducing out-of-pocket spending on healthcare and alleviating the load on the state.
Medical scheme membership has hovered around the 9-million mark for more than a decade, covering an ever-shrinking proportion of SA’s growing population and leaving a steadily increasing majority to depend on under-resourced state hospitals and clinics. The poor state of public healthcare has been described in harrowing detail in several high-profile investigations by the health ombud, and in a report released earlier this week by the FF+ catalogueing horrific patient experiences at dozens of public hospitals.
Stats SA’s 2021 General Household Survey found 28% of the population turned first to a private healthcare provider when they needed care, indicating that millions of people who do not have medical scheme cover are paying out of pocket for visits to GPs, dentists and hospitals.
The CMS briefed the minister on Wednesday, and handed over its report, which it said contained “various options and recommendations for the minister to consider”. The CMS declined to release the document, saying it was the minister’s prerogative to do so. The minister’s spokesperson Doctor Twala said the minister needed time to read the report and consider its recommendations, and would then release it
The Board of Healthcare Funders (BHF) said the minister was required to provide it with the report in line with a recent high court settlement in which he agreed to give the organisation all its documents on LCBOs. The BHF is an industry association for medical schemes and administrators and has been an outspoken critic of the pace at which the CMS has developed the legislative framework for LCBOs. In July it obtained a high court order compelling the minister and CMS to provide it with all their records on LCBOs: the minister agreed to do so, but CMS is challenging the ruling.
BHF head of research Charlton Murove said the potential market for LCBO products ranged from 6-million to 15-million people.
He questioned the CMS’s decision to place the ball in the health minister’s court, saying the regulator had the authority to grant exemptions to the Medical Schemes Act and allow schemes to offer LCBO products right away.
Wits governance professor Alex van den Heever said the health department’s involvement was required only if a wider policy framework was considered, that could not be implemented by way of exemption.
“This looks like prevarication. LCBOs can be approved on a case by case basis where they serve the goals of the Medical Schemes Act. However, the CMS is not an independent regulator and therefore has little interest in attempting to achieve the goals of the act,” he said.
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