BHF is the representative organisation for the majority of medical schemes throughout South Africa, Namibia, Zimbabwe, Botswana as well as Lesotho. As the industry representative body, the organisation relies on the membership of all medical schemes to ensure that it is able to lobby government and other organisations effectively and to influence policy where necessary on behalf of the entire industry. Read more..

Specialists ‘behind rising health costs’ 17/03/15

MEDICAL specialists seem to be the cowboys of medical expenses industry - charging high fees and making expensive referrals - making them of particular interest to Health Minister, Dr Aaron Motsoaledi. He states in the Department of Health’s (DoH)
submission to the Health Inquiry that “profit-maximising specialists and hospitals are able to exert their dominance through price increases and price discrimination with relative impunity, and currently have no need to compete on either price or quality in
order to attract patients”. Specialists and private hospitals are viewed as the drivers of price changes as they direct patients to hospitals where treatment is provided. Prof Alex van den Heever, Chair of Social Security at the University of the Witwatersrand, in his Review of Competition in the South African Health System said
specialists are, therefore, the main drivers of demand for all expensive services, including hospital, medicine, devices and diagnostic services. Total, monthly healthcare benefits increased by 42 percent from R623 in 2000 to R882 in 2011. Price hikes are

largely driven by the increase in benefits paid for private hospitals (an increase of around 82 percent since 2000) and medical specialists (an increase of around 74 percent since 2000). But submissions from the role-players differ markedly on the reasons for
the expenditure. The South African Medical Association (Sama) denies specialists are driving costs. Hospitals, allied health professionals and non-healthcare costs consume together 54 percent of medical scheme funds. When radiology and pathology costs are removed, specialists represent 12.7 percent of medical scheme expenditure and consume R12.2 billion in 2011, which is close to the R12.1 billion spent on nonhealthcare expenses by medical schemes. Sama argues that specialists have only gained
10 percent market share from 18.3 percent to 20.3 percent from 1997 to 2013 (including radiology and pathology costs) thereby disproving these allegations. The Board of Healthcare Funders said specialists are charging up to 300 percent more than
medical aid schemes limits, but the South African Private Practitioners’ Forum said over 80 percent of specialists charge no more than 120 percent of scheme rates. Specialists
blame inappropriate pricing guidelines that are not cost-based. The Health Professions Council of South Africa (HPCSA) provides guideline tariffs after a court ruling took this authority from the DoH. Hospitals compete in a variety of ways to attract doctors to
establish practices at their facilities. The DoH said a closer look should be taken at what it calls “perverse provider incentives associated with reimbursement structures”. Life
Healthcare (LHC), Mediclinic and Netcare have shareholding relationships with doctors, controlled by the HPCSA. LHC said the HPCSA initially imposed a cap on doctor shareholding but later removed the cap as it found that the shareholding did not
function as a perverse incentive.

Threat to medical aid basics - 17/03/15

Katharine Child: The Times, 17 March 2015
THE Health Department is considering changing legislation that requires medical aid societies to pay for the treatment of certain medical conditions in full - irrespective of how much the service provider charges. A leading health economist, Wits professor Alex
van den Heever, said that if the government does change the law it will be abdicating its responsibility to protect medical aid members and will be “protecting big business at the expense of the vulnerable and sick”. The regulation the Health Department is
considering changing became law in 2004 and was intended to ensure that medical aid members got basic medical cover. It states that the schemes must reimburse members in full for the costs of all emergency medical treatments, and for treatment of 26
chronic diseases and 270 conditions. This clause, the subject of two court cases, protects consumers such as diabetics who previously often exhausted cover for monthly
medication halfway through a year. Van den Heever said the law had forced schemes to pay for chronic medicines and so they had negotiated with pharmaceutical companies to drop drug prices. The proposed change in the law, Van den Heever said, would
remove the incentive for schemes to negotiate with suppliers of medical services for better prices. It would also mean patients might be left responsible for large copayments
for emergency treatment. The Board of Healthcare Funders, representing medical aid schemes, has lobbied government to review the law. The board argues that medical aid members cannot have benefits paid for in full - regardless of the cost - if
there are no tariffs limiting what doctors can charge.


Medical council to decide official’s fate

Medical council to decide official’s fate THE Council for Medical Schemes (CMS) revealed that the independent forensic audit
into its suspended registrar, Monwabisi Gantsho, has been finalised, and he is to face an internal disciplinary hearing. It will determine whether he is fit to continue in his role as
head of the CMS. The CMS said certain aspects of the probe, which could not be concluded during the independent forensic investigation, still require further investigation. Dr Gantsho was suspended last April by Health Minister Aaron Motsoaledi
pending the outcome of a forensic probe into claims he asked for a R3m kickback from former Medshield curator Themba Langa.


BHF Trustee Training: 2015:

This focused, comprehensive, one-day course provides in-depth information on the key areas relating to good governance of medical schemes. Highly relevant to trustees and those working within the private funding sector.

The topics are presented by industry experts and all delegates receive a CD with resource manual containing relevant information as well as a bound copy of the Medical Schemes Act and Regulations.

We will be posting the dates of the 2015 Training sessions soon

Please contact zolam@bhfglobal.com for information regarding future Trustee Training sessions, as well as customized sessions.



BHF responds to ‘Medical aid battle’ reported in The Times: 6 March 2015

Press Release:

According to an article published in The Times today (6 March 2014), medical scheme members could find their cover reduced if a legal battle to have the prescribed minimum benefits (PMBs) capped is successful. The article states that the South African Municipal Workers' Union Medical Aid (SAMWUMED) and Genesis Medical Scheme have taken Minister of Health, Aaron Motsoaledi, to court to have the regulation requiring cover of prescribed minimum benefits - irrespective of the cost - struck down.
However, SAMWUMED has taken issue with the article. “No journalist from the publication called us to validate any facts,” said principal officer, Neil Nair. “We would appreciate a correction to the article. SAMWUMED has decided to withdraw from the High Court application in the matter of having Regulation 8 set aside. The main reason for this decision was to allow the Minister an opportunity to amend Regulation 8. To this end a Task Team has been established by the national Department of Health – of which SAMWUMED is a participant. Further to this, we expect a more expeditious resolution to the problems brought about by the current interpretation of Regulation 8. SAMWUMED is also encouraged that the Board of Healthcare Funders (BHF) is actively engaging with the Department on this matter. This decision shall be reviewed by the SAMWUMED board based on developments.”
The Department of Health is currently reviewing proposed amendments to Regulation 8, which requires all PMB-related benefits to be paid in full by medical schemes, regardless of what the provider chooses to charge. “We hope to reach a solution that will be fair to patients, providers and funders,” said deputy director-general of health, Dr Anban Pillay.
The article quotes Christoff Raath, joint CEO of Insight Actuaries whose analysis is cited in the court papers, as saying that some specialists charge significantly more for PMB procedures than for illnesses not covered by the minimum benefits. Raath said that it was not illegal for doctors to charge what they wished. However, the law that their costs will be covered in full removes the incentive for doctors to enter into price negotiations with medical schemes - and negotiations on price are needed to keep costs down.
That providers can charge whatever they choose for PMB-related conditions (diagnosis, investigation, treatment and hospitalisation) is a serious issue for the BHF, which represents some medical schemes including SAMWUMED. The article states that the BHF ‘tried to get the benefits struck down in 2011 but was disqualified on a technicality’, which is a gross misrepresentation of what in fact took place. Managing Director Dr Humphrey Zokufa has expressed his grave concerns at the article’s unfortunate handling of an important and sensitive issue. “The narrative is distorted and has needlessly whipped up much negative emotion by suggesting that we are attempting to disadvantage the consumer, when we are actually working to their benefit,” he said.
The BHF is wholly supportive of the principles underlying the PMBs. “The problem lies with the implementation of the law,” said Zokufa, “which has had unintended consequences. If schemes are compelled to pay in full, regardless of what providers charge, that would constitute irresponsible and wasteful utilisation of members’ premiums. That there is no regulation or guidance currently applicable to what providers can charge makes the schemes vulnerable to abuse. The outcome has been a vicious circle of escalating premiums and reduced benefits that disadvantage the consumer.”
“Our court action in 2011 was therefore undertaken with a view to getting an independent, neutral legal opinion on the interpretation of Regulation 8’s ‘pay in full’ clause, as opposed to that of the Council for Medical Schemes, which we feel is erroneous. A scenario that gives providers a blank cheque is untenable and unsustainable. There is a gap here that needs to be closed and this was the issue at the heart of our legal action in 2011, not an attempt to have benefits ‘struck down’. We are hopeful that the amendments currently being discussed with the Department of Health will address matters, meaning that from the BHF’s perspective there is now no need for further legal action, hence SAMWUMED’s withdrawal of its application.”
Editor’s notes:
The Board of Healthcare Funders of Southern Africa (BHF) is the representative body for the majority of medical schemes throughout South Africa, Lesotho, Namibia, Botswana, Swaziland and Zimbabwe.

Issued BY Zola Mtshiya, Manager: Marketing, Branding and Communications

For more information contact Zola Mtshiya, Manager: Marketing, Branding and Communications on 0829031856 or zolam@bhfglobal.com or Dr Humphrey Zokufa

Medical aids 'dictate treatment' to doctors

Katharine Child: The Times, 11 February 2015

MEDICAL aid scheme administrators and private hospitals are accused of colluding to restrict the range of medicines that healthcare workers can prescribe to their patients. In submissions to the Competition Commission inquiry into the cost of private healthcare, doctors said they were furious that medical aid scheme administrators were setting the prices doctors could charge, and by restricting the medicines they could prescribe were interfering in the treatment of patients. In its submission to the inquiry, the SA Medical Association, representing more than 7 000 doctors, slammed the three
biggest hospital groups, Mediclinic, Life and Netcare, and medical aid administrator Discovery Health. The association claimed that they colluded in deciding which treatments would be available in hospitals.

Please click here for more details

Guidelines: Rural-proofing for health

Guidelines: Rural-proofing for health
DRAFTED by the Rural Health Advocacy Project (RHAP), the guidelines are designed to provide policymakers at national and district levels with a tool to evaluate whether health policies meet the needs of rural populations. The 52-page guidelines are designed to not only evaluate the appropriateness of policies but also ensure that they are effective and sustainable, and move to improve equity in healthcare services. Divided into eight chapters, the guidelines cover areas such as key background on rural
health in South Africa before moving to provide a framework for analysing the health system. Like the National Department of Health, RHAP uses the World Health Organisation’s (WHO) Health Systems Framework to evaluate the healthcare systems.
The guidelines thus divide the system into six core components, which are then evaluated by inputs, resources and priorities for instance. RHAP will be running free trainings on the guidelines for government officials and civil society.

Please click here
to download the guidelines

Doctors 'operating legally' after Concourt ruling - 27 January 2015

By: Chantelle Benjamin
Mail and Guardian

Issuing the proclamation led to a situation that could discourage practitioners from providing essential services for fear of criminal sanction.
Lawyers for Zuma and the health department said the president had

Doctors and healthcare providers are once again operating legally, after the Constitutional Court declared invalid a proclamation by the president bringing into effect sections of the National Health Care Act that regulates where doctors can operate.

Following the proclamation issued by President Jacob Zuma, doctors would have had to apply to the department of health for a “certificate of need”, or permission to work in an area, by April 1 2016. Please click here for more

Do economics laws apply to hospitals? - 28 January 2015

Dave Marrs: Company Comment: Business Day, 28 January 2015

THE Competition Commission’s decision to block Life Healthcare’s bid to acquire Lowveld Hospital in Nelspruit has provided insight into pricing in private hospitals. The antitrust body says it rejected the deal because it feared significant price increases. Life does not have a hospital in Nelspruit. Mediclinic, Lowveld and a newcomer that started operating in October last year are the only providers in the area. When it comes to pricing, Lowveld is cheaper than Mediclinic as its prices are based on National Hospital Network’s (NHN’s) fee structure. NHN is a grouping of independent hospitals whose collective share of SA’s private hospital market is about 25 percent. Life, Mediclinic and Netcare jointly control the remainder. The commission said as a group Life’s prices are sometimes higher than those of Mediclinic, so allowing Lowveld to become part of Life might result in significant price increases. And there would be no competition between Life and Mediclinic in the area because both would benefit from price increases. The commission’s reasoning is obviously based on speculation, but if true it is disturbing that the prices charged by big hospital groups are higher than those of their small and independent rivals. What happened to economies of scale? Do economics laws not apply to private hospitals?

French health insurers in tie-up

Leigh Thomas: Reuters, 12 January 2015

TWO of France's biggest mutual health insurers have signed a tie-up as the sector seeks economies of scale in the face of strained public health budgets.

MGEN and Harmonie Mutuelle agreed to hold exclusive talks for six months aimed at thrashing out the details and winning approval from their policyholders, who in effect own them under their mutualist structures. With MGEN focused on public sector workers and Harmonie Mutuelle on the private sector, the combined group would have annual revenues of about €5bn and cover more than 8-million people. With the state's health insurance budget severely pinched and healthcare costs rising, health insurers have little choice but to cut costs or raise insurance premiums.

Healthcare in 2015

Katharine Child: The Times, 8 January 2015

There is more to healthcare than New Year resolutions to lose weight and eat better. Here is some of what to expect in the health arena in 2015.

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