CMS ban on low-cost med schemes faces legal challenge

Organisation: Position: Deadline Date: Location:

Discovery Health may turn to litigation after the Final Board of Appeals of the Council for Medical Schemes (CMS) banned two of its primary care medical insurance products, says Rapport. The appeals board ordered Discovery to cease its coverage of about 30,000 people on its Comprehensive Primary Care and Essential Primary Care products, as it did for Agility Insurance Administrators for similar products.

Rapport says the ruling against healthcare-specific role-players is based on demarcation regulations placing products conforming to the definition of a medical scheme under the CMS and insurance products under long and short-term insurance legislation. Discovery’s products provide cheap coverage for primary healthcare and specific procedures, but do not cover all Prescribed Minimum Benefits as does a medical scheme.

According to the report, Discovery said it had already launched a new application to allow its two products, apparently under the Discovery group’s short-term insurance licence rather than the medical administrator.

Discovery says it will approach the courts if necessary as the ban ‘leaves a critical vacuum in the market’. These products are aimed at millions of South Africans who cannot afford medical scheme coverage, but do not want to rely exclusively on public healthcare. There is uncertainty about these products as the government has yet to provide a framework for ‘low-cost options’ for medical schemes that would have to be exempt from PMBs. CMS head Sipho Kabane said the low-cost option framework would not be ready by March as previously planned.

Full report in Rapport (subscription needed)

Receive Medical Brief's free weekly e-newsletter

Related Posts

Thank you for subscribing to MedicalBrief

MedicalBrief is Africa’s premier medical news and research weekly newsletter. MedicalBrief is published every Thursday and delivered free of charge by email to over 33 000 health professionals.

Please consider completing the form below. The information you supply is optional and will only be used to compile a demographic profile of our subscribers. Your personal details will never be shared with a third party.

Thank you for taking the time to complete the form.