NATIONAL ASSEMBLY
FOR WRITTEN REPLY
QUESTION NO. 2139
DATE OF PUBLICATION IN INTERNAL QUESTION PAPER: 06 NOVEMBER 2009
(INTERNAL QUESTION PAPER NO. 27)
Ms E More (DA) to ask the Minister of Health:
(1) Whether any studies have been conducted into the effects of the
Medical Schemes Act, Act 131 of 1998, with regard to (a) community
rating and (b) prescribed minimum benefits (PMB) deterring young
healthy and lower income persons from obtaining private medical cover;
if not, why not; if so, what were the findings;
(2) whether his department is looking into allowing medical aid schemes
being able to offer lower income persons the options of choosing lower
costing medical aid packages through reduced PMB; if not, why not; if
so, what are the relevant details?
NW2821E
REPLY:
(1) The Medical Schemes Act, 131 of 1998 was implemented primarily to
ensure that all individuals who are willing and able to afford private
health insurance cover are accorded adequate opportunity to do so.
This is precisely why the Act is based on the principles of open
enrolment, community rating and the entitlement of prescribed minimum
benefits (PMB). Open enrolment ensures that all individuals are
treated equally when it comes to enrolling onto any given scheme and
that their historical and current health profile has no bearing on
whether they are allowed to join a scheme of their choice or not. To
further emphasise this principle, community rating ensures that no
person is levied premiums that are higher than the scheme average
merely because they have a worse off health profile than other medical
scheme members. Without these measures, access to medical schemes
would not be available to older and sicker members of society.
While there have been challenges in the overall implementation of the
Act, it is because of the enshrined principles that it is not expected
that the introduction of the Act would in any way adversely impact on
the ability of lower income persons from obtaining private medical
cover. Medical schemes submit detailed monthly returns on their
membershipâs age and risk status to the Council for Medical Schemes.
Analysis of this data has shown that there is no evidence of younger
and healthier people dropping out. On the contrary, in December 2007,
a total of 4,054,065 medical scheme beneficiaries were in low risk
options, while in December 2008 there were 4,686,527 beneficiaries in
low risk options. This constitutes 16% growth in low risk option
membership while the overall growth in numbers was 6%.
(2) Recently there has been an upsurge in the number of medical schemes
requesting to be granted exemptions from the prescribed minimum
provisions of the Medical Schemes Act so that they can offer low
income options to their members.
The position of the Department of Health has always been that since
there exists no regulatory framework wherein such exemption could be
granted and more importantly that the PMBs are designed in a manner
that aims to ensure that all medical scheme members are entitled to a
common set of healthcare benefits irrespective of their benefit option
and their income-earning status, it is impossible to grant such
exemptions. It is also not acceptable for Government to assume a
policy position that offers a lesser set of healthcare entitlements to
one group of individuals over another purely because of their income
status or for affordability reasons.
Furthermore, international and local health economics literature
clearly indicates that lower income persons are more likely to face
higher disease burdens and thus have more need for healthcare than
their better-off counterparts. Therefore, it does not make policy or
economic sense for Government to grant exemptions to medical schemes
so that they are able to offer lower income persons the options of
choosing lower costing medical aid packages through reduced PMB
benefits.
END.