Medical aid regulator told to explain

• Board of Healthcare Funders wants reason for blocking low-cost schemes

The Council for Medical Schemes has 10 working days to provide the Board of Healthcare Funders (BHF) with the entire record that explains why it decided to block the introduction of low-cost medical aids. The BHF, an industry body representing most medical aids in SA, won an interim battle in the North Gauteng High Court on Monday. It is part of a bigger case arguing that the regulator’s decision to block low-income earners from accessing a medical aid is irrational.

The Council for Medical Schemes (CMS) has 10 working days to provide the Board of Healthcare Funders (BHF) with an entire record that explains why it decided to block the introduction of low-cost medical aids.

The BHF, an industry body representing most medical aids in SA, Namibia, Zimbabwe, Botswana and Lesotho, won an interim battle in the North Gauteng High Court on Monday. It is part of a bigger case arguing that the medical aid regulator’s decision to block low-income earners from accessing a medical aid is irrational.

Were low-cost medical aids to be permitted, it would allow lower-income earners access to some private care, such as general practitioner visits and acute medication.

As medical aids have to provide legislated prescribed minimum benefits, their monthly premiums are not cheaper than R1,000. However, it has been more than seven years since the council began to develop a legal framework to enable medical schemes to offer low-cost benefit options (LCBOs) that would be exempt from providing the full, costly suite of benefits stipulated by the Medical Schemes Act.

But the CMS still has not decided how to do this and yet has allowed a select group of health insurers to continue selling primary healthcare cover products that effectively do the same thing with less supervision and lower customer protection.

This led a frustrated BHF to ask the court in August to declare the CMS’s failure to develop and implement an LCBO framework to be irrational, unreasonable and unlawful in terms of the Promotion of Administrative Justice Act and the constitution.

The constitution says that administrative action must be lawful, reasonable and procedurally fair.

The medical aid industry has been stagnant with 8-million main members for years, as the economy is not growing. The BHF aims to find a way to increase the number of members making medical aids more sustainable.

It wants a record of how decisions against low-cost options were made, to supplement its legal argument. While the CMS provided 800 pages of publicly available documents, it is not satisfied, said Charlton Murove, head of research at BHF. From these documents BHF lawyers identified 36 that are likely to exist, based on references to meetings or studies.

Murove said meeting minutes that describe how decisions were taken should exist. “If you are running government and making serious policy decisions, how are you supposed to do that? Aren’t you supposed to record meeting minutes?”

The BHF believes the regulator is blocking low-cost medical aids to make National Health Insurance (NHI) more palatable, Murove said. If medical aids can grow, they can become more affordable for everyone and more sustainable, he said.

“If medical schemes continue being unsustainable, it makes it easier to have an NHI. That is our postulation. But we will look at the record and confirm this.”

The CMS argued the list of 36 documents required is a “horrendous shopping list”. But the court ruled that the fact that the documents “seem to be voluminous and quite extensive is of no concern … the documents are properly identified and described”.

The court agreed with a previous Constitutional Court judgment that “every scrap of paper that can throw light on the state decision-making process is relevant and needs to be produced”.

Murove said low-income consumers would benefit from lower-cost medical aids instead of the current healthcare insurance policies offered.

“Insurance companies, by their very nature, are not designed to offer healthcare benefits. Current policyholders… are losing out.”

The CMS was not immediately able to comment.