The woes of Renaissance Health Medical Scheme continue as the joint liquidators of the scheme have instituted action against the former board of trustees, principal officer, administrator and curator for the recovery of R88-million. This includes a claim of R8-million against the court-appointed curator who ran the scheme before it was declared insolvent.
The scheme was placed under curatorship on May 20 2008 and the curator sought to protect members’ interests and stabilise the scheme’s finances. At the time, Renaissance was late with its financial reports and its solvency ratio had declined. Medical schemes are required to maintain a 25% solvency ratio in order to have sufficient funds to meet any liabilities.
Former administrators Property Health Managers submitted management accounts containing inaccurate information concerning the financial position of the scheme, resulting in the regulator of the industry Council for Medical Schemes (CMS) being misinformed as to the true financial position of the scheme as at December 2007.
According to Aleksandra Serwa, communications manager and spokesperson for the CMS, the management accounts submitted to the CMS reflected a claims outstanding provision of R27 350 804 and a consolidated solvency of -7,5% but the correct management accounts reflected a claims outstanding provision of R55 878 907 and a consolidated solvency of -22,5%.
The scheme was liquidated on October 17 2008, and as at July 31 2008 it had a total of 5 825 principal members and 12 212 beneficiaries. These beneficiaries were transferred to Medihelp on October 1 2008.
According to the liquidators, the trustees failed to keep the scheme financially sound — the value of its assets did not exceed the value of its liabilities, meaning that it did not have sufficient assets.
The respondents are denying the allegations and opposing the application.
The CMS regulates the medical schemes industry in South Africa. If you wish to lodge a complaint against your medical scheme, contact the CMS complaints adjudication team on [email protected] or call a consultant on 0861 123 CMS (267). CMS lawyers investigate and resolve thousands of complaints every year.
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