July 3, 2010
By Laura du Preez
The Council for Medical Schemes Appeal Committee will be asked to reconsider the obligation on medical schemes to pay claims related to the prescribed minimum benefits (PMBs) in full regardless of the rate charged by a healthcare provider.
The issue affects your right to enjoy full cover from your medical scheme for essential health care and the cost to your scheme of providing that right.
Schemes fear that the obligation to pay PMB claims regardless of the rate charged could increase the cost of claims, which will ultimately affect the contributions you pay to your scheme.
The matter came to a head with two Council for Medical Schemes Appeal Board rulings late in 2008. The rulings held that schemes may not pay PMB claims at the rate at which a scheme reimburses claims but must pay these claims at the rate charged by your doctor, hospital or any other healthcare provider.
Now Fedhealth hopes to convince the medical schemes regulator to adopt a different view by appealing to its Appeal Committee against a ruling made by the office of the Registrar of Medical Schemes last month.
In terms of the registrar's ruling, Fedhealth was ordered to pay about R2 700 for PMB claims to two doctors who charged more than the rate at which the scheme reimburses claims.
The surgeon and the anaes-thetist treated a Fedhealth member who had serious injuries after almost dying in motor vehicle accident and who was in intensive care for five weeks.
Katy Caldis, Fedhealth's chief executive officer, says Fedhealth has paid about R650 000 of the member's medical bills to date, but the two doctors charged at a rate that was above 300 percent of the guideline Reference Price List (RPL) tariffs.
The maximum rate at which the option to which the member belongs pays for claims is 300 percent. Most schemes base their rates on the RPL, and 300 percent is one of the highest rates that schemes pay.
However, doctors and other healthcare providers are increasingly charging above the rates typically paid by medical schemes, because they believe the RPL rates, published by the Department of Health, do not reflect the costs of running their practices. The RPL is being challenged in a High Court case in which judgment is awaited.
The registrar's ruling against Fedhealth is based on a regulation issued under the Medical Schemes Act, regulation eight, that states that medical schemes must pay claims for PMBs in full and without charging members any co-payments.
There are different interpretations of what "pay in full" means, but since late 2008 the Council for Medical Schemes has followed the interpretation of the Appeal Board in cases against Samwu-med, a restricted scheme for municipal workers, and the Government Employees Medical Scheme. The Appeal Board is a statutory body to which appeals against the council's Appeal Committee rulings are referred.
Legal opinion
Caldis says Fedhealth believes the Appeal Board's interpretation of regulation eight is incorrect.
She says Fedhealth and its administrator, Medscheme, and a number of other medical schemes in February this year obtained a legal opinion from senior counsel "which indicated that 'payment in full' as referred to in regulation eight ... means that PMBs should be paid at full costs but subject to the scheme's tariffs in terms of the scheme rules and not simply the full invoice price".
The legal opinion the medical schemes and Medscheme obtained indicates that the way in which the Appeal Board and, as a result, the Council for Medical Schemes have interpreted or are interpreting regulation eight to mean that schemes must pay the full costs of a PMB in line with the invoice price is beyond the powers of a scheme as provided in terms of the Medical Schemes Act, Caldis says.
She says the senior counsel told the schemes that if they followed the Appeal Board's interpretation, they would be acting illegally, because they would be forced to pay claims outside of their registered rules.
Caldis says Medscheme, Fedhealth and a number of other medical schemes met with the Council for Medical Schemes to convey the schemes' view on the matter based on the legal opinion they had obtained.
The Board of Healthcare Funders, which represents medical schemes, met with Dr Aaron Motsoaledi, the Minister of Health, and the council on the matter in February this year.
Caldis says at that meeting the minister recommended that the words "pay in full" in regulation eight must be revised to limit any unintended consequences.
She says Motsoaledi further stated that there must be a moratorium on all action against schemes by the council until the issue has been resolved.
However, at a PMB workshop it hosted earlier this year, the Council for Medical Schemes said that in its view the law as it stands must be followed until it is amended by Parliament.
'PMBs cause schemes endless problems'
The PMB regulations were poorly drafted and the meaning of these regulations causes medical schemes endless problems, a trustee of a smaller scheme who does not want his scheme to be named says. The trustee cited some examples of the problems his scheme is facing:
A member who was dying of cancer and who was in a coma was sent for a diagnostic scan for oncology treatment a few hours before he died.
The member had been treated by another oncology practice for three months, during which time he had various scans, for which the scheme paid. These doctors had sent the patient home because they could do nothing more for him. The new doctor refused to review the patient's case notes on file and wanted to start the diagnostic procedures all over again.
The office of the Registrar of Medical Schemes ruled that boots worn by a child before a surgical procedure for a clubbed foot should be paid for as a PMB. The boots were classed as a necessary external appliance, and the scheme fears it may be open to abuse if other practitioners are similarly able to class anything from crutches to computerised wheelchairs as a necessary external appliance.
A member involved in a motor vehicle accident incurred medical bills of R1 420 426. The scheme paid R1 247 612 - claims for the balance of R172 814 were submitted as PMBs. These claims relate to out-of-hospital expenses such as acupuncture, wheelchairs and pharmacist accounts, and one claim is for headphones used while in hospital.
The trustee says the registrar's office has taken the view that any account after the accident should be covered in full. The scheme believes that at some point ongoing medical accounts can no longer directly relate to the accident. The scheme believes it cannot be expected to pay for every future medical account as a PMB.
The scheme is paying excessive rates for stents (usually inserted to relieve obstructed blood vessels), because their cost can be claimed as a PMB. The scheme has managed to negotiate a discount on only one stent, because stent manufacturers have told the scheme they will only negotiate with doctors. The scheme is questioning why it has to pay inflated prices for stents rather than the actual cost to the supplier.
An anaesthetist is regularly charging a higher rate for his PMB services than he does for his non-PMB services. The medical scheme believes this is blatant abuse of the system.
Controversial regulation 'is on task team's agenda'
The medical schemes industry task team set up to address the implementation of the PMBs is "back on track" and will consider a controversial regulation that forces schemes to pay PMB claims regardless of the cost.
Medical scheme representatives were unhappy about the exclusion of regulation eight (issued under the Medical Schemes Act) from the task team's agenda and questioned their continued role in the task team.
But Boshoff Steenekamp, the Council for Medical Schemes's strategic projects specialist, told Personal Finance that all the medical scheme, healthcare provider and consumer group representatives who were elected to the task team have agreed to continue the team's work.
The team aims to develop a code of conduct on PMBs that is binding on all healthcare providers and schemes by the end of this month.
Steenekamp says the task team will consider the problems that schemes are having with implementing regulation eight, but the issue of the rate that providers can charge for the PMBs is "more difficult to deal with, as we cannot set tariffs in this forum".
However, Rajesh Patel, the head of the benefit and risk department at the Board of Healthcare Funders who is also a member of the PMB task team, says his understanding is that regulation eight is firmly on the task team's agenda.
He says it was agreed at the task team's most recent meeting that while the team cannot change the law, there is no reason the team cannot consider a proposed redraft of the regulation, which can be sent to the Minister of Health.
PMB task team member Neil Nair confirmed that he is continuing as a member of the team despite a previous request to give the task team's scheme representatives time to consult about the exclusion of regulation eight from the agenda.
Nair is the principal officer of Samwumed, a low-cost restricted scheme for municipal workers. He believes that compelling schemes to pay PMB claims at whatever rate a healthcare provider charges will make Samwumed unaffordable for its members.
Rates: what you should know
If a healthcare practitioner plans to charge you more than the rate at which your medical scheme will reimburse you, the practitioner should ask you to agree to the higher tariff in writing.
A recent article in the Council for Medical Schemes's publication CMS News says this is the principle that has been adopted by the Health Professions Council of South Africa (HPCSA), which is the body that regulates medical practitioners.
According to the article, if you are charged a rate higher than that at which your scheme will pay and you do not consent to the higher charge, the practitioner will be regarded as overcharging.
The CMS News article further states that if you do not belong to a medical scheme, the medical practitioner must charge you the guideline Reference Price List (RPL) tariff unless you give the practitioner written and informed consent to charge you more.
The article says if you are a medical scheme member, the practitioner should show you the scheme rate, the difference between that rate and what he or she will charge, and the amount you may have to pay in addition to what your scheme will pay.
If you are uninsured, the practitioner should show you the RPL rate and the difference between that rate and what he or she will charge, the article says.
The HPCSA says if a practitioner does charge you more than the relevant rate without obtaining your informed consent, you can complain to the HPCSA.
Complaints must be sent in writing to "The registrar: HPCSA". You can download a complaint form from the HPCSA's website, www.hpcsa.co.za. You can fax your complaint to 012 328 5120/ 012 328 4895, email it to legalmed@hpcsa.co.za or post it to PO Box 205, Pretoria 0001.
  
 
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