Monday, 20 May, 2024
HomeMedico-LegalDiscovery appeals dismissal of application for RAF to resume payments

Discovery appeals dismissal of application for RAF to resume payments

Discovery Health CEO Ryan Noach says the company has appealed the dismissal by the Gauteng High Court (Pretoria) of its application seeking to compel the Road Accident Fund (RAF) to immediately resume the processing of claims and payments to medical scheme claimants.

The appeal is set down to be heard this week, reports MoneyWeb.

The application was lodged after the High Court declared unlawful an RAF directive that no payments be made to claimants by the fund if their medical aid scheme had already paid for their medical expenses arising from road accidents.

The RAF directive was issued on 12 August 2022 and declared unlawful on 27 October 2022 after an urgent application by Discovery Health.

Both the High Court and the Supreme Court of Appeal (SCA) have dismissed the RAF’s leave to appeal the ruling, leading to it applying to the Constitutional Court for leave to appeal judgment.

Noach said the RAF has failed to recommence claims processing for medical scheme members despite the unlawfulness of its directive, as per the High Court rulings.

He said the High Court had dismissed Discovery’s Section 18(3) 26 June application seeking to enforce the unlawfulness of the RAF’s directive because there was an appeal pending to the Constitutional Court, but it was important to remember this dismissal has no bearing on the fact that the RAF directive has been declared unlawful.

“The judgment from the High Court in October 2022, which was also supported by the Supreme Court of Appeal in March this year, remains in force.”

Noach previously told Moneyweb that Discovery Health’s successful litigation achieved protection for members of medical schemes against discrimination by the RAF, which sought to unlawfully discriminate against medical scheme members by excluding them from RAF payments.

Loss of millions ‘not an exceptional circumstance’

In dismissing Discovery Health’s Section 18(3) application, Judge NV Khumalo said the company’s suggestion that “medical schemes are suffering daily irrecoverable losses of millions of rands” is incorrect and does not constitute an exceptional circumstance.

“The applicant (Discovery Health) has failed to demonstrate sufficient degree of exceptionality that indicates any harm that is irreparable to justify the extraordinary order for the upliftment of the suspension,” she said.


This came after Discovery Health pointing out that medical schemes cannot direct their member claimants to refuse to settle these matters as their rules generally only impose an obligation on members to include past medical expenses in their claims and to reimburse the medical scheme of any amounts recovered from the RAF.

Discovery Health further claimed that the settlement of the claim is binding and in full and final settlement of all of the RAF’s liability in respect of the accident.

It said consequently every time an unlawful tender is accepted and settled, the medical schemes are deprived of the potential to recover the past medical expenses where the medical scheme had already paid for the medical expenses.

It added that since August 2022 the medical schemes suffered irrecoverable losses of at least R138m because 15% of the population has private medical insurance.

The RAF disputed the allegation that Discovery Health conducts a business of a medical scheme and that it is entitled to the RAF’s money that is used to pay for the benefits to which the medical scheme’s member claimants are entitled in law.

It argued that Discovery is only an administrator of medical schemes, that the money paid out is from the medical schemes, thus Discovery Health does not suffer harm when making such payments.

The RAF further claimed the medical schemes Discovery Health administers also do not suffer any loss when they pay the benefits they owe to their members, and accordingly argued that no direct loss is suffered either by Discovery Health or the schemes.


MoneyWeb article – Discovery appeals dismissal of call for RAF to resume medical aid claimant payments (Open access)


See more from MedicalBrief archives:


Court blow for Discovery Health in RAF feud


Discovery wins court bid to stop ‘rogue’ RAF’ directive


Discovery challenges RAF directive in court




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