Ann Eveleth: IN THE ACT
The public health system must have heaved a sigh of relief when the Cape High Court turned down a challenge to Minister of Health Nkosazana Zuma’s Medical Schemes Bill. Cleared of the legal hurdle created by Business South Africa’s attempt to shift the debate into the National Economic Development and Labour Council, the Bill must now be debated by Parliament’s portfolio committee on health before it is presented to the National Assembly.
The Bill aims to reduce the burden of health costs borne by public hospitals by requiring medical aid schemes to take on more members. Many schemes have been criticised for denying access to those most vulnerable to high health costs, such as the elderly and those suffering from chronic illnesses.
The new Bill promises to prevent schemes from “cherry-picking” – profiting off the money contributed by healthy members, but remaining wary of taking on members considered to be high-risk. The Bill will prevent medical schemes from charging higher contribution rates on the basis of age, gender, past or present state of health, or the amount of claims submitted by a member.
It will also prevent schemes from excluding the dependents of members and stop schemes sending contributors into the public system after their benefits have run out.
The Bill’s initiation has been marked by a flurry of court actions on behalf of health insurance companies, talk in Zuma’s department of a “conspiracy” against health transformation and threatened protest action by the Bill’s proponents in the tripartite alliance. But the controversy has obscured a curious shift in the private sector. The vast majority of medical schemes – the 70% that work differently from health insurers – have given their support to the Bill.
Their support contrasts claims by medical insurance companies that the provisions might lead to the demise of the sector and pave the way for Zuma to introduce a national health care system. The key to this difference may lie in the Bill’s efforts to draw a clear line between medical schemes that cross-subsidise the health costs of the sick and elderly through the contributions of the young and healthy and those that bank on the continued good health of their members.
The health care sector is a multibillion-rand industry and is marked by fly-by-night schemes. The Bill offers new protections to consumers, including a requirement that schemes register with the council and their administrators are accredited. It also seeks to put an end to undesirable business practices.
The Bill will empower the council to enforce strict financial controls to ensure that a scheme is financially viable, and that it uses members’ money for the purposes for which contributions are intended. This will reduce the risk of schemes going belly-up and leaving hordes of stranded contributors to fend for themselves.
ENDS