The Department of Health and the Council for Medical Schemes (CMS) have embarked on a major review of the minimum benefits that all medical schemes must provide. The review is expected to result in new regulations on these benefits being drafted between October and March next year.
This is according to a strategy document released by the medical schemes regulator that outlines the timeline for the review, the problems that need to be tackled, an outline of the benefit package to be considered, and a programme for how the regulator and the department plan to tackle this crucial but tricky project.
The document discloses that the Department of Health rejected the council’s recommendations for changes to the prescribed minimum benefits (PMBs) – which were based on a previous review – because the PMBs are still too focused on in-hospital benefits and do not prioritise the country’s health needs.
The PMBs were introduced in 1999, when the Medical Schemes Act was promulgated. The aim of the PMBs is to prevent you from being denied medical scheme cover when you are faced with a serious illness, and to encourage greater efficiency in the allocation of private and public healthcare resources. A list of medical conditions, covering in the main catastrophic and chronic conditions, was drawn up, and schemes are required to cover the costs related to the diagnosis, treatment and care of these conditions.
The PMBs are supposed to be reviewed every two years, but this has not happened, which has resulted in a number of problems.
Rising costs
One of the biggest problems is that the PMBs are very expensive and have contributed to medical scheme contributions becoming unaffordable for many people.
The cost of the PMBs increased by 13.4 percent between 2014 and 2015, from R556 per beneficiary per month (pbpm) to R608 pbpm, the CMS says.
The cost of the PMBs is affected by a number of factors, including that medical scheme membership is not compulsory for all employed South Africans, the council says.
There has been much debate over the benefits included in and excluded from the PMBs. In particular, many primary healthcare benefits, such as visits to a general practitioner, are excluded, although they could help medical scheme members avoid more expensive higher levels of care.
Another very contentious issue, which has resulted in some legal challenges against the regulator and the Department of Health, is that the PMB regulations require schemes to pay healthcare providers “at cost” for the treatment, diagnosis and care of a PMB condition, regardless of what the provider charges.
Schemes can, however, appoint a designated healthcare provider and insist you use that provider to be covered in full for the diagnosis, treatment and care of a PMB.
The CMS notes that court challenges have arisen over what it describes as “a poor definition” of “at cost” in the PMB regulations. This has resulted in some healthcare providers treating the PMBs as a “blank cheque” and charging excessively high fees to treat PMB conditions.
There have also been cases of what is known as diagnosis creep, or the upcoding of diagnoses, in order to access PMBs.
Other problems
Other problems the council has identified in a document on the PMB review are:
• There are inconsistencies and flaws in the current regulations;
• There have been changes in the cost-effectiveness of health technologies or interventions; and
• The way in which the PMBs are defined makes it difficult for you, as a medical scheme member, to know before you are treated whether or not certain conditions will be covered.
In addition, the council says the PMBs do not adequately protect you if your medical scheme structures its benefits so that they favour young and healthy members.
The council has started collecting information on the quality of care for the current PMB package and has found that it is poor in a number of conditions.
Stakeholders, including scheme members, have until January 27 to comment on the PMB review. Email pmbreview@medicalschemes.com