Medical schemes bill awaits inquiry outcome

The health department is waiting for the Competition Commission to complete its healthmarket inquiry before it finalises the Medical Schemes Amendment Bill, says a senior official

This means the department has effectively decoupled the bill’s legislative passage from the National Health Insurance (NHI) Bill, which was presented to the cabinet in early December.

Both bills were released for public comment on June 21, with interested parties given three months to make submissions.

Health minister Aaron Motsoaledi said then the two bills went hand in hand, but some industry players questioned the wisdom of introducing medicalschemes reforms before the inquiry was complete.

THE HEALTH DEPARTMENT HAS EFFECTIVELY DECOUPLED THE AMENDMENT BILL FROM THE NHI BILL

The inquiry, which got under way in 2014, is investigating the dynamics of the private healthcare market and trying to establish whether there are barriers to effective competition. It originally planned to publish its final report and recommendations by November 2015, but it has been repeatedly delayed and its deadline for publishing its final report is now March 29 2019.

It has examined the medicalschemes industry and its relationship with consumers and service providers closely. Its provisional report, published on July 5, includes several recommendations that directly affect the sector. These include standardising benefits across all schemes and implementing a risk-adjustment mechanism to remove the advantage enjoyed by schemes with younger and healthier members, as well as the introduction of a supply side regulator to oversee tariffs.

The health department’s deputy director-general for NHI Anban Pillay said the minister had been advised that the inquiry’s final recommendations could be incorporated into the Medical Schemes Amendment Bill without it needing to be released again for public comment, because the inquiry had included its own public participation process.

Once approved by the cabinet, the bill would be submitted to parliament, and there would be further opportunity for public participation, he said.

In the NHI bill, a continued role for medical schemes was envisaged, he said, without giving details. “The [NHI] white paper makes it very clear you can’t rush this. It must be phased in properly,” he said.

The draft Medical Schemes Amendment Bill has proposals to improve governance, tighten broker fees and expand mandatory benefits to include more primary healthcare benefits.