medical service providers in South Africa are charging more for services that
are on the list of prescribed minimum benefits (PMBs).
the unequivocal finding of Christoff Raath, an actuary and CEO of the Health
Monitor Company, who analysed data from a range of healthcare providers. He was
speaking at the 14th annual conference of the Board of Healthcare Funders
Southern Africa (BHF), that took place this week at the CTICC in Cape Town.
looked at charges billed to medical schemes by general surgeons between January
2010 and July 2013 and found that "the spend per life per month on non-PMB
services were almost linear", remaining constant in nominal terms throughout
this period. Conversely, the costs for
services which fell under PMBs increased at an alarming rate over the same
further showed that four of the ten largest anaesthetist practices in South
Africa are explicitly charging more for their services when surgery happens to
be classified as a PMB.
increase in fees by specialists in the face of PMBs may be undesirable, but it
is perfectly rational, given the incentives inherent in the system,” he said.
“If you know that you will be guaranteed payment, no matter how much you
charge, wouldn’t you charge more?”
to Raath, PMB’s are “absolutely necessary” but he takes issue with the
draconian way in which they are applied, as well as the lack of consultation
about which medications and services should fall under this description.
“We don’t need
a draft amendment bill to address PMBs,” he pointed out. “These are
regulations. The last time we saw a consultative process on this issue was in
2009 with the PMB Code of Conduct. There hasn’t been any progress since then.”
presentation, Raath also turned his attention to the financial results of
medical schemes since 2004.
investments are not taken into account, the schemes posted a loss every year
from 2005 to 2011, with a R1-billion surplus being recorded last year. Closer
analysis showed that the bulk of the surplus was made by mainly two restricted
schemes: GEMS and Polmed.
for a medical scheme to be able to offer a low cost option to its clients, it
needs to have a high proportion of young and healthy members within such an
option. “Without the young and healthy
members, we are seeing the demise of the low cost option,” Raath said.
shows, however, that most medical schemes are effectively funded by the
“worried healthy” or “worried wealthy” who are prepared to pay generously for
their health security – perhaps because these consumers are not fully aware of
their PMB and option selection entitlements.