Your basic right to minimum medical benefits

by WeCare Marketing
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Private health care users have long complained that medical aid companies are refusing to pay for their prescribed minimum benefits, which all schemes must cover. The Health Market Inquiry said the system must be bolstered to ensure patients receive their basic rights.

Diagnosed with extensively drug-resistant tuberculosis (XDR-TB) in 2011, Andaleeb Rinquest was bedridden for a year and lost half her body weight. Her doctor put her on Linezolid, a powerful antibiotic. The drug saved her life, but she went broke trying to pay for it after her medical aid provider Discovery Health refused to pay for it.

Another patient, only described as Mr E, developed antiretroviral-related lypodystrophy as a side effect of his HIV medication. It causes fatty growths on the back and neck and serious health problems. Despite his doctor’s recommendation, Mr E’s medical aid provider Bonitas Medical Fund refused to pay for surgery, forcing him to pay from his own savings.

The Competition Commission’s provisional report into the private health care market, released on Thursday, focused on cost and competition in the sector, but also included important recommendations to enforce patient rights.

Rinquest and Mr E’s costs should have been covered by Discovery and Bonitas as they fell under the prescribed minimum benefits (PMBs) all medical schemes are required to cover. According to law, every medical scheme must fully pay services associated with conditions on the PMB list, as long as patients go to designated service providers. The costs cannot be drawn from members’ savings accounts.

Both Rinquest and Mr E, whose stories were submitted to the inquiry by Section27, managed to recover their costs after the NGO intervened, but others may not be as lucky.

The PMB list includes 270 acute conditions and 25 chronic conditions. The inquiry found the Department of Health hadn’t regularly reviewed the list as required by law. There is no system to ensure medical schemes pay the costs from their risk pools (companies pool members’ contributions to pay for health care expenses) rather than members’ savings accounts.

Section27 deputy director Umunyana Rugege welcomed the release of the inquiry’s long-delayed provisional report on Friday.

“Patient rights continued to be a focus of the inquiry. We welcome the protections of these rights as patients navigate the private health system as well as the strengthening of the regulators,” she said.

“The high price of health care must be addressed as a priority and we’ll be exploring the Health Market Inquiry’s proposals on tariff setting and the reframing of prescribed minimum benefits to achieve greater access to a comprehensive package of services.”

The inquiry analysed data from medical schemes and found that they mostly complied with regulations related to in-hospital PMB claims. Only 0.37% of such payments came from members’ savings accounts with 3% going unpaid.

Out-of-hospital claims are more concerning. Schemes are increasingly following the regulations, but in 2014, 9% of PMB claims were paid from savings accounts and 5% went unpaid.

“The complexity of the PMB system creates a non-trivial enforcement problem,” read the report.

The inquiry made a number of recommendations to ensure that medical scheme members understand and can access PMBs. To simplify schemes on offer, it said companies should all offer a base package including PMBs, which must be expanded to include primary and preventative care.

It also said the PMB package should be reviewed at least every three years and scheme members should be given information to help them understand what they’re entitled to and when additional costs can occur.

That would include a checklist of all prescribable medicines for each PMB; a list of designated service providers where members can seek treatment; and when a member seeks treatment, explicit advice on whether a service provider or treatment has further cost implications and what alternatives are available.

The report spent considerable time on the claim that obligatory PMB payments have led to the ever-rising costs of private health care.“The (Health Market Inquiry) was unable to find support for the assertion that PMBs are a primary driver of cost escalation in private health care,” it concluded.

“Even though PMBs are not a primary driver of expenditure escalation, they are an increasing component of medical scheme expenditure over the analysed period,” it continued. The report made a number of recommendations to decrease the cost of schemes covering PMBs, largely linked to reforms in arbitrary pricing models and “supply-induced demand”.

Stakeholders have until September to comment on the provisional report and Discovery Health has already hit back at the suggestion that as the country’s dominant health care funder it is profiting from a distorted and uncompetitive market.

Discovery Health CEO Jonathan Broomberg told Business Daythe company’s increased profits were due “to a number of business factors, including continuous innovation and greater operational efficiency driven by management excellence and by large investments in advanced systems and customer service technologies”.

The report revealed how the markets in medical aids and health care facilities are dominated by only a few large players. This has put bigger companies on the back foot, and they arelikely to send lengthy suggestions for changes to the report before its final release in November.

Carl Grillenberger, CEO of Advanced Health, which is a smaller, day-hospital operator, was excited about the proposal of promoting competition by placing a moratorium on giving new facility licences to the three largest hospital providers.

“Provincial departments have set a pattern of granting licences to acute facilities which automatically limits the success of applications submitted by others, such as day hospitals, which offer innovative, cost-effective alternatives,” he said.

Grillenberger said the recommendations “show that South Africa has the potential to provide a fairer, more accessible private health care offering to consumers, and we look forward to seeing a greater acceptance of day hospitals as part of the solution”.


Article by: Greg Nicolson

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