Proposed Changes to PMBs

Medical Schemes ActProposed changes to the South African Medical Schemes Act may affect how medical aid schemes in the country cover the costs of prescribed minimum benefit (PMB) conditions. These proposals have sparked fierce debate.

Open-ended PMB funding model: unsustainable?

Historically, medical aid schemes have been legally obliged to cover the costs, in full, of the diagnosis, treatment and care of almost 300 medical conditions. This applies regardless of the type of plan a beneficiary has subscribed to, or what the attending practitioner charges.

Medical aid schemes have long criticised the open-ended funding model. They claim it has placed an unreasonable burden on their financial resources, in turn resulting in soaring annual increases to monthly contributions for scheme members.

Draft amendments

In an effort to appease critics, the Minister of Health, Aaron Motsoaledi, recently published a draft amendment to Regulation 8 of the Medical Aid Act. It states that all registered healthcare providers must adhere to a regulated PMB tariff.

In addition, schemes must ensure that beneficiaries receive the requisite treatment and care for PMB conditions, without co-payments or benefit limits being imposed.

The proposed changes will effectively cap the rates that healthcare practitioners are entitled to charge for the diagnosis, treatment and care of PMBs.

Also, the minister’s proposals in relation to Regulation 5 of the Act require that medical professionals and hospitals prepare and submit discharge summaries to schemes as pre-cursors to payment.

Arguments from healthcare practitioners

Some healthcare providers are arguing that capping their rates equates to unprecedented and unconstitutional interference by the government.

It's also argued that the new requirement for discharge summaries may place a significant administrative burden on healthcare providers, as well as resulting in potentially long delays in the payment of benefits.

Victory or more pain for consumers?

Scheme administrators have hailed the minister's intervention as a victory for both the medical aid industry and the beneficiaries it serves.

Healthcare practitioners, on the other hand, have raised the red flag, stating that the widening gap between what schemes are allowed to pay and the actual rates practitioners currently charge will have to be picked up by the hard-pressed consumer.

With the principal players – medical aid schemes and medical professionals – some way off from reaching a consensus, and legal interpretation differing markedly according to which group is represented, it will be interesting to see whether the proposed amendments are legally adopted. Watch this space!