Concern over move to end right to cede work-related compensation claims

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Proposed amendments to legislation governing work-related compensation claims that will prohibit the ceding of claims to administration companies dedicated to this kind of work have raised concerns among medical service providers.

However, a Business Day report says the Employment & Labour Department has defended the proposal, saying it wants the Compensation Fund to work directly with clients in the same way that all other insurance companies and medical aid schemes do. The proposed amendment would also mean that medical service providers that do not use third-party administrators would be unable to use their debtors book as collateral for an overdraft facility from commercial banks.

The prohibition is contained in a proposed Compensation for Occupational Injuries and Diseases Amendment Bill. Parliament’s Labour Committee has called for public submissions on the proposals by 19 February. A proposed amendment to the Bill that is being welcomed is the inclusion of domestic workers as beneficiaries under the Act for the first time, but there are concerns that the removal of the right to cede claims would undermine the success of this inclusion as domestic workers would have no-one to help them with their claims.

Injured Workers Action Group (Iwag) spokesperson Tim Hughes highlighted the "chronic" dysfunctionality of the Compensation Fund caused by the difficulty in accessing its computer system.

The Business Day report notes the action group is comprised of injured workers, trade unions, medical service providers, companies, banks and administrators. He could not see any rational justification for the prohibition of this practice and said medical service providers had not been consulted about it.

The Iwag fears that the removal of this right to cede claims would lead to medical service providers refusing to treat injured workers because of the difficulty of getting paid by the fund.

SA Medical Association chair and practising GP Angelique Coetzee has said in the past that the cumbersome and problematic nature of submitting claims to the fund brought many medical service providers to the conclusion that it was better not to see these types of patients. She expects that the same would happen if the use of third-party administrators is prohibited.


Full Business Day report (Restricted access)

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