Curiouser and curiouser the private healthcare funding wonderland grows. This week, the Council for Medical Schemes withdrew its package of benefit requirements for the low-cost options that medical schemes will be allowed to offer from next year.
In September, the council set up a minimum package for schemes that wanted to apply for an exemption from the Medical Schemes Act to offer such an option.
The intention is that these options will serve people earning less than the tax threshold (about R6 140 a month) by offering them medical scheme cover for primary healthcare benefits in the private sector. These benefits would include consultations with a general practitioner, acute medicines and optometry and dentistry, but would exclude costly private hospital cover. In particular, the exemption from the Medical Schemes Act would exempt schemes from providing the prescribed minimum benefits (PMBs) on these options.
However, the benefit package was criticised by the South African Medical Association (Sama), the professional body for medical practitioners, which said that by excluding the benefits for HIV and heart conditions, the package would “cream-skim healthy lives”.
Sama says “cream-skimming” occurs when a health care package is aimed at attracting those who need health care less and will cost the scheme less than regular members.
“South Africans are more likely to die from these conditions than some of the conditions covered in the package. Those who suffer from these conditions are also less likely to purchase the package,” Sama says.
Despite the fact that the proposals were published for comment in May, the association criticised the council for failing to consult with the public.
Sama said some of the treatments proposed in the package are “a waste of money”, because they will not improve health outcomes for members of the options and that consistent treatment of a condition with a single practitioner was, at best, non-existent.
The package was inconsistent with current clinical practices and national policies, Sama said, adding that the council was seeking to increase the overall number of medical scheme beneficiaries by recruiting those who are eligible for free health care in the public sector, instead of implementing compulsory enrolment and risk equalisation, while awaiting the implementation of National Health Insurance (NHI).
According to Elsabe Conradie, the manager of stakeholder relations at the Council for Medical Schemes, it decided after the criticisms from Sama that the proposed package required further analysis and the benefit package is therefore withdrawn until further notice.
The council says in a statement that a revised package will be published in due course after consultation with all relevant stakeholders.
Conradie says the council has already received some data it is analysing and hopes to put a new proposal before its board (confusingly also called the council) at the end of the month.
The low-cost benefit option has also been criticised by Cosatu, which says the package is inadequate and was being introduced “to bolster a devouring financial black hole of the greedy private medical schemes industry”. Cosatu says NHI is the only viable policy to ensure that the working class is protected from a financialised health sector.
The problem is, we don’t even have a white paper on NHI yet, and, even if we did, we know it is still years away.
We also know that the National Treasury is working with the Department of Health to release any day now the latest regulations under the Insurance Acts to demarcate the business of a medical scheme from that of health insurance policies.
Previous drafts of the demarcation regulations reveal that the plan is to close down so-called “combination policies” currently used by thousands of low-income earners. These policies provide thousands of people with primary healthcare cover at private doctors, which means they avoid losing a day of work to go to a government clinic, and often provide cover for emergency transport to get them to hospital, which can be life-saving. And it is this vacuum that the low-cost benefit option was apparently intended to fill.
There was previously a plan to introduce social health insurance (compulsory medical scheme membership for all who could afford it) as a first step to NHI.
There were also proposals almost a decade ago to introduce low-income medical schemes and income cross-subsidies.
Then there was a court ruling that upheld the right of short-term insurers to offer health insurance products. This resulted in the mushrooming of the so-called combination policies to fill a big consumer need.
Now, many years later, there is still no NHI and still a need for affordable healthcare for low earners that the state healthcare system can’t seem to provide.
Some seemingly hastily drawn up proposals to provide a solution for the users of the combination products are now under attack.
At the very heart of it all is the lack of a plan. The criticism that schemes are regulatory orphans has been levelled before, but the latest developments also reveal a sorry lack of planning to meet the needs of low earners who are currently not members of schemes – even if it is just an interim measure until we have NHI.