Health insurance plan controversy

All hell has broken loose among medical schemes because their representative organisation, the Board of Healthcare Funders (BHF), is allegedly involved in the process of developing a national health insurance plan.

According to experts, such a plan could mean the end of medical schemes as they are now and hold serious implications for their members.

Role players in the industry are furious, as they have heard that the BHF has granted permission for its staff members to assist with formulating the plan.

This unhappiness could result in the organisation being torn apart because most of the largest medical schemes have already withdrawn from the BHF.

A meeting is to be held shortly to establish an alternative organisation. It is believed that more than half of South Africa's medical schemes and administrators will join the new organisation.

In a confidential document distributed among schemes it is alleged that the membership fees paid to the BHF by the medical schemes is not being used in the interest of members but rather for developing a political party's policy.

The storm erupted when schemes heard that the ANC task group for national health insurance (NHI) has requested that Dr Debbie Pearmain, the BHF's legal officer and also member of the BHF executive committee, assist with the formulation of the plan.

Ms Heidi Kruger, spokesperson of the BHF, says Pearmain has only been asked to advise on the legal aspects of the proposed plan. Pearmain is an expert in the field of healthcare legislation and the BHF board has granted permission for her to assist.

The department of health is planning a national health system that will provide cover for basic medical services to all and which will be financed by a monthly amount that all employed persons will have to pay.

This health insurance levy will not only result in the taxpayers' burden being much heavier, but could also diminish the role of medical schemes considerably.

What this means for medical schemes
Schemes are concerned that the proposed national system will restrict the activities of medical schemes to such an extent that they will not be able to provide cover for any services that fall within the NHI framework. Schemes might therefore be restricted only to the provision of top-up cover, which would pose a threat to their survival.

It also means that most people would be dependent on a government institution for their medical cover.

In a confidential document in Sake-Rapport's possession, a number of medical scheme grievances regarding the BHF's role in the establishment of the NHI are set out. It is stated inter alia that the BHF is not looking after the schemes' interests in the formulation of the NHI and that recent documents of the ANC task group make no mention of medical schemes.

Medical schemes uncertain of their role
The BHF's preliminary discussion document on the NHI apparently does not even include medical schemes' concerns about the role they will play in the new dispensation.

“The BHF is asking medical schemes to support the NHI process by providing analyses, business models and processes for the administration of healthcare finances, but does not clarify the models that will be discussed and the role the private sector will play," says the document.

The BHF, on the other hand, says it has increased its internal research capacity to such an extent that it is now in a good position to analyse and influence legislation.

(Letitia Watson, Sake Rapport, March 2009)