Medical aid costs: Can prescribed minimum benefit reform bring relief?

You can also listen to this podcast on iono.fm here.

JIMMY MOYAHA: About two weeks ago we took a look at the conversation around whether or not having more individuals join medical schemes could potentially bring down the cost of medical schemes.

Listen/read: Can mandatory medical scheme membership fix affordability?

This time around we are going to take a look at another aspect critical to medical schemes, and that is the benefits that you get from a medical scheme.

This is because the Council for Medical Schemes [CMS] has decided to review the prescribed minimum benefits [PMBs] for medical aids in South Africa in an effort to identify what should be classified as prescribed minimum benefits, and how these should benefit medical scheme members.

We are going to look more closely at this with public health specialist at the Council for Medical Schemes, Dr Samantha Iyaloo. She joins us on the line to see what we make of this. Dr Iyaloo, lovely having you on the show, thanks so much for taking the time.

Let’s start with what brought about the need to review the prescribed minimum benefits. Where did this come from, from a council perspective?

ADVERTISEMENT

CONTINUE READING BELOW

SAMANTHA IYALOO: Good evening, Jimmy, and good evening to your listeners. And thank you for having me on your show.

Essentially the Medical Schemes Act, which is the governing legislation that gives rise to the Council for Medical Schemes and its mandate as the regulator of the medical schemes industry, states that the prescribed minimum benefits should be reviewed every two years – although there has been progress and work on reviewing the current conditions under the PMBs, the prescribed minimum benefits, in terms of advancements in health technologies such as the incorporation of newer medications, newer treatments.

And although we have had many reviews where conditions were added to the PMBs, such as the chronic disease lists – HIV was added a long while ago and more recently Covid-19 was added – a full review of the PMBs has not been accomplished.

It is the Minister of Health who ultimately approves the PMB review recommendations, while the National Department of Health and the Council for Medical Schemes, the CMS, leads the activities under the PMB review. It is a very multi-stakeholder and complex process.

Previously, a review of the prescribed minimum benefits was accomplished and submitted to the minister, but he did not endorse the reviewed package owing to its hospital-centric nature.

So that is the problem that we have with the PMBs – that they are very hospital-centric.

So although the minister did not approve that, he had advised the CMS to work on a primary healthcare package of services that could be included as part of the prescribed minimum benefits.

So that’s essentially the work that the CMS has been undertaking and progressing in this regard.

JIMMY MOYAHA: Dr Iyaloo, if we think about the amendments or proposals around prescribed minimum benefits, does it not then put us in a potential conversation of worrying about whether or not increasing prescribed minimum benefits would increase the minimum cost of coverage?

How do we balance having the right kind of coverage in place with the cost side of it because, as it stands, medical schemes have grown in terms of becoming more and more unaffordable for many South Africans? And that’s why we have conversations like the NHI [National Health Insurance] coming up.

SAMANTHA IYALOO: Certainly that is the case. What we realise is that an ideal package doesn’t only have primary healthcare and it doesn’t only contain what the PMBs have been so good at – just a hospital-centric package.

ADVERTISEMENT:

CONTINUE READING BELOW

Having an ideal package needs to include both primary healthcare and coverage for common prescribed minimum benefit conditions – especially those where catastrophic health expenditure can arise.

That’s why we need to ensure that the costs of the revised PMBs are kept down, and at the same time increase coverage of medical scheme members. So we want more members on medical schemes.

We also want to decrease the costs of out-of-pocket payments for members – all while addressing the health needs of medical scheme members.

So, while a new health package of services that includes primary healthcare is important, other innovative and alternative considerations such as value-based healthcare and alternative reimbursement models other than the traditional fee-for-service models should be considered.

So while the CMS oversees and regulates the environment within the scope of the Medical Schemes Act, it is still up to medical schemes to ensure administrative efficiencies that promote value for the members.

JIMMY MOYAHA: Dr Iyaloo, let’s take a closer look at the National Health Insurance aspect of this conversation. The prescribed minimum benefits are very much like what is being proposed from a National Health Insurance perspective, in terms of having basic coverage for every South African. In reviewing these prescribed minimum benefits for medical schemes as they stand, does that then bring us in closer alignment with national health coverage?

Is that perhaps a different conversation that needs to be had with medical schemes around coming up with a package that has the prescribed minimum benefits which then become the affordable package that we translate into the NHI?

How do we start to merge these two worlds that we’ve perhaps been struggling to merge up to this point?

SAMANTHA IYALOO: Yes, that’s a very good question, and we do believe that these reforms that we are putting forward will help ease the pressures on member households in terms of lowering healthcare contributions and decreasing out-of-pocket payments.

ADVERTISEMENT:

CONTINUE READING BELOW

But we must remember that these reforms will form a stepping stone to increasing coverage and decreasing costs.

But it will ultimately be superseded by the planned roll-out of the National Health Insurance in its aim for progressive realisation of universal health coverage, where medical schemes are only envisioned to offer complementary services.

But until such time, we at the CMS are committed to working very hard to help improve these pressures and to keeping the beneficiaries at the centre of decision-making – all while ensuring the sustainability of the medical schemes industry.

Indeed, there has to be alignment between the public and private sectors with the planned rollout of the NHI, seeing that it is the Minister of Health who’s ultimately responsible for approving the recommendations that come from the CMS.

The National Department of Health also has a key role to play in helping the CMS lead with these activities. So there has to be alignment – and it is a stepping stone.

JIMMY MOYAHA: We need to ensure that we have a collective conversation around medical aid, medical schemes’ coverage, and do our very best to achieve universal healthcare coverage for all South Africans.

Whether that’s reviewing minimum prescribed benefits or coming up with an alternative implementation strategy for the National Health Insurance policy, we need to figure it out and we need to do it together.

We’ll leave the conversation on that note. Public health specialist at the Council for Medical Schemes, Dr Samantha Iyaloo, joined us to take a look at the council’s decision to review prescribed minimum benefits for medical schemes and the impact that could have.

#Medical #aid #costs #prescribed #minimum #benefit #reform #bring #relief