Mr E lives in South Africa, a country in which everyone has a constitutionally entrenched right to have access to healthcare services. He and 17% of the population access this right through the private healthcare sector by paying monthly contributions to a medical aid scheme.
To ensure that the users of the private healthcare system are protected in the healthcare market, the Medical Schemes Act provides for prescribed minimum benefits (PMBs), which detail the treatment every medical scheme is required to pay in full, regardless of the member’s plan.
This means that, when unanticipated serious illnesses occur, members do not have to pay for the diagnosis or treatment of PMBs from their pockets or their medical savings accounts, which are meant to cover day-to-day healthcare expenses.
The minimum benefits prescribed include 270 conditions and 25 chronic illnesses such as HIV, tuberculosis, pregnancy, heart conditions and emergency medical treatment.
But the protection provided by the minimum benefits has often evaded people like Mr E.
Also, like many South Africans, he is HIV positive. He has been on antiretroviral treatment since the early 2000s. As better drugs became available, his drug regime changed several times and he developed a painful side effect – antiretroviral-related lipodystrophy – which causes fatty growths to develop on the back and neck.
It caused Mr E severe pain and frequent fainting but, despite several motivations from his doctor, his medical aid claimed it was cosmetic surgery and refused to pay for it.
Distraught, Mr E paid for the surgery out from his savings, even though he could ill afford it.
Then he approached the public interest organisation Section27 and it helped him to recover his money from the scheme because the procedure should have been classified as a PMB and paid in full by the scheme.
Financial hardship, debt and despairMany other people have experienced financial hardship, debt and despair, or have even gone without the healthcare they need, because their schemes do not pay their claims despite being under a clear legal and constitutional obligation to do so. A medical scheme that does not cover the full cost for PMB conditions is in contravention of the law.
Despite the clear requirement for medical schemes to pay in full for PMBs, schemes routinely ignore it. In 2009, the Council for Medical Schemes, an independent statutory body established to regulate medical schemes, issued a circular stating that noncompliance “appears to be an industry-wide practice rather than being restricted to a few medical schemes or administrators”.
Last year, 2?411 of the 2?717 complaints to the council were about PMBs.
Those, like Mr E, whose claims are unlawfully refused by medical schemes, must make difficult choices in order to access the healthcare they need and believed they had protected themselves against.
In 2010, the Board of Healthcare Funders, representing some schemes in South Africa, launched a legal attack on PMBs, suing the council and minister of health.
The board argued that, contrary to the council and the minister’s interpretation of the prescribed benefit regulations, the requirement that medical schemes pay in full merely requires payment on a scale or tariff determined by the scheme.
This often falls short of the actual cost of the service charged to the patient by the healthcare provider.
The respondents, some doctors among them, argued that the law was unambiguous.
Such claims should be covered in full by the schemes in terms of the invoice issued by the healthcare provider.
The court dismissed the case on technical grounds and did not decide on the correct interpretation.
Corruption in the systemThe main argument against PMBs and the guarantee of payment in full is the so-called “blank cheque” syndrome. In other words, providers of health services are said to charge excessively for PMB conditions and in effect cross-subsidise their practices because of the assurance that prescribed benefits will be paid in full by the medical scheme.
There is anecdotal evidence to support this and the framework certainly lends itself to this kind of behaviour, but the answer is not to reduce coverage for PMBs because that harms patients.
Schemes must manage the risk and negotiate prices with service providers instead of passing risk on to members. Mr E and others should not become collateral damage in a financial battle between healthcare providers and medical schemes.
All doctors, whether working in the public or private sector, are one of the primary ways in which we obtain healthcare services.
To protect the right to access healthcare services, the Health Professions Act states that overcharging is unprofessional conduct, which can lead to disciplinary procedures and penalties for health professionals.
The boards of the Health Professions Council of South Africa, which govern various medical disciplines, must “assist in the promotion of the health of the population of the republic” and “protect the public”, and are responsible for setting fee norms or “ethical tariffs”.
The ethical tariffs are used to determine whether a patient has been overcharged and, if so, to ensure the patient is reimbursed by the service provider.
This is another important legislative step taken by the state to ensure that patients are charged reasonable fees in order to protect their rights.
Worryingly, the council has failed to fulfil its mandate to publish ethical tariffs since 2006. In 2013, the council embarked on a public process to establish ethical tariffs.
After extensive consultations with interested parties, a reasonable proposal was published for further comment.
But the council has suddenly and inexplicably stalled its own processes, which raises important questions about whether the council as a whole is sufficiently independent to carry out its obligations diligently, without undue delay and without fear or favour, as is required by section 237 of the Constitution.
Inquiry These issues validate the need for the market inquiry of the private healthcare sector recently launched by the Competition Commission.
The inquiry’s terms of reference describe private healthcare costs as being “at levels only a minority of South Africans can afford”.
Various explanations for the “cost, price and expenditure increases in the private healthcare sector” will be examined in the context of the right to access healthcare services.
An assessment of regulatory gaps and existing regulations should form part of this investigation.
On completion of the inquiry, the commission may recommend new or amended legislation, regulations and/or policies and may also make recommendations to regulatory authorities such as the Council for Medical Schemes and the health professions council.
These examples show that, despite constitutional rights and the state’s efforts to fulfil its duties to regulate the private healthcare market, to many patients like Mr E, these protections remain illusory.
The inquiry would do well to keep in mind the constitutional obligations of state entities, the existing regulatory bodies and the participants in the private healthcare sector themselves.
But to understand the sector properly, the inquiry must place the experiences of patients and the apparent inability of weak regulatory structures to protect them at the centre of its investigation. It owes Mr E no less.
Umunyana Rugege works as an attorney at Section27. This article is the third in a series of opinion pieces Bhekisisa is running on how to curb private healthcare costs. Bhekisisa does not necessarily endorse the views represented
Prescribed Minimum BenefitsPrescribed Minimum Benefits (PMB) is a set of defined benefits to ensure that all medical scheme members have access to certain minimum health services, regardless of the benefit option they have selected. The aim is to provide people with continuous care to improve their health and well-being and to make healthcare more affordable.
PMBs are a feature of the Medical Schemes Act, in terms of which medical schemes have to cover the costs related to the diagnosis, treatment and care of:
• Any emergency medical condition (the sudden and, at the time, unexpected onset of a health condition that requires immediate medical treatment and/or an operation);
• A limited set of 270 medical conditions (defined in the Diagnosis Treatment Pairs);
• And- 25 chronic conditions (defined in the Chronic Disease List).
When deciding whether a condition is a PMB, the doctor should only look at the symptoms and not at any other factors, such as how the injury or condition was contracted. This approach is called diagnosis-based. Once the diagnosis has been made, the appropriate treatment and care is decided upon as well as where the patient should receive the treatment (at a hospital, as an outpatient or at a doctor’s rooms). – Source: Council for Medical Schemes www.medicalschemes.com
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