• 2020-02-03

    CMS to scrap low-cost medical scheme plans
    A new circular published in December 2019 by the Council for Medical Schemes (CMS) stating the intention to do away with Low-Cost Benefit Options (LCBO) on all medical schemes in South Africa, has left the South African healthcare industry in shock.
    With the announcement to disallow low-cost options and any form of health insurance products in South Africa for low-income consumers, the CMS is taking another step towards a nationalised healthcare sector by aligning the healthcare offerings of medical schemes and health insurance companies to make way for NHI.
    CMS registrar Sipho Kabane issued the circular on 4 December, saying that this exemption framework had created opportunities for companies to offer products that were not in consumers’ best interests. “Our major concern is that they over-promise and under-deliver,” he said.
    "The purpose of this circular serves to inform medical schemes, insurers and other interested parties that no Low-Cost Benefit Options [LCBO] will be allowed for low-income market segments going forward."
    The decision is to align such products with the broader health policy discussion that seeks to ensure adequate access to care, irrespective of the economic status of the population," the circular read.
    According to the Free Market Foundation (FMF), an independent public benefit organisation that promotes and fosters an open society, the rule of law, personal liberty, and economic and press freedom, “The proposals are shambolic. They do not reflect a well-considered, balanced view on how to increase access to quality healthcare for low-income consumers.”
    The FMF states that this pronouncement shows a complete lack of understanding of how private health insurance products have the potential to reach many lower-income individuals. “And in the process, providing increased access to quality healthcare and alleviating the burden on the already overstretched public healthcare sector.”
    “Indeed, the government must respect the right of access to health care services by not unfairly or unreasonably getting in the way of people accessing existing health care services and it must promote the right by creating a legal framework so that individuals can realise their rights on their own,” the FMF stresses.
    According to the FMF the statement, “can best be described as a continuation of the slow and steady poisoning of the private healthcare sector in South Africa and the government’s dogged determination to dismantle the private healthcare system in preparation for its flawed and ideological desire to introduce its centrally controlled and administered National Health Insurance [NHI] scheme.”
    Sources and further reading: 
    Medical Brief 
    Business Live 
    Business Tech
    Free Market Foundation 
    City Press

    View videos from thought-leaders on the topic:
    Council for Medical Schemes weigh in on discussions

    Dr Sipho Kabane, Registrar and Chief Executive officer of the medical schemes regulator, the Council for Medical Schemes (CMS), recently published an opinion piece in Fin24 on why the regulator is seeking to discontinue the Low-Cost Benefit Option (LCBO) offered by all medical schemes in South Africa. These options, which are intended to increase the affordability of medical schemes, have become a contentious issue as the healthcare industry debates the decision and the implications thereof. 

    To read the full article click here

Loading, please wait...