Proposed amendments to the Medical Schemes Act released by Health Minister Aaron Motsoaledi will entail a big shake-up in benefits and contribution rates but are aimed at ensuring medical schemes remain affordable and viable until National Health Insurance is in place.
The minister also released the National Health Insurance Bill this week, giving the broad framework but no details of how NHI will be funded or the benefits it will provide.
Motsoaledi said that NHI would do away with the need for government to subsidise contributions to schemes for its own employees.
Private-sector companies could decide for themselves how to proceed.
Industry sources say the changes to schemes are likely to be implemented in phases and the impact for members and employers who subsidise contributions will depend on each scheme's benefits and reserves, and on members' incomes.
The Medical Schemes Amendment Bill proposes that medical schemes:
• Be obliged to pay claims in full with no co-payments;
• Charge wealthier members more in contributions to subsidise the contributions of lower earners; and
• Extend the prescribed minimum benefits to include primary and preventative healthcare.
— Motsoaledi said that NHI would do away with the need for government to subsidise its employee contributions
The minister says members currently fork out R29-billion in co-payments partly subsidised by the government through tax rebates.
Medical schemes, however, have complained that they are at the mercy of providers who overservice and increase their tariffs when they know schemes are obliged to pay as in the case of prescribed minimum benefits.
The tariffs doctors, hospitals and other providers charge was referred to the Competition Commission's Health Market Inquiry, which is due to release its findings next week, but Motsoaledi said he feared it may be interdicted from doing so by affected stakeholders. Asked how schemes could be expected to cover whatever providers charge without co-payments, the minister said tariffs "will have to be uniform".
Charlton Murove, head of research at the Board of Healthcare Funders, says schemes need more details on how the scrapping of co-payments would be implemented.
The Council for Medical Schemes is conducting a review of the prescribed minimum benefits that is likely to take another two years. But expanded benefits are likely to add to the costs borne by schemes.
Motsoaledi suggests schemes set aside less in reserves to ameliorate the financial impact. They are now required to set aside 25% of contributions, but on average schemes have 33% of contributions or R60-billion in reserve.
The minister says this is an "unnecessary accumulation" at the expense of patients.
The council is revising the reserve requirements to align them with the risks that schemes face, with bigger schemes and those with younger, healthier members generally being regarded as lower-risk. Motsoaledi said the council would be encouraged to introduce the new requirements as soon as possible.
Morove said setting reserve requirements according to risk should make schemes more affordable, but in some cases schemes might need to raise reserves of more than 25% of contributions.
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