Proposals to prohibit Compensation Fund services sector ill-advised

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With the stroke of a legislative pen the government proposes to wipe out a services sector that has played a crucial role in acting as an intermediary between medical service providers and the Compensation Fund a Business Day editorial says. The editorial argues that if the fund were operating optimally and not in the dysfunctional way it is, there would perhaps be no need for intermediaries. But even in this case it should be left to the medical service providers themselves and not to the government to decide how they manage their businesses.

The controversial proposal is contained in a section of the Compensation for Occupational Injuries and Diseases Amendment Bill which is before parliament’s employment and labour committee.

The editorial says the department’s rationale for the proposed prohibition is thin indeed.

An official is quoted as saying that the Department of Employment & Labour, under which the Compensation Fund falls, wants the fund to deal directly with its clients in the same manner as other insurance companies and medical aid schemes do. He added that this was in the best interests of workers, businesses and the fund. There was no need to incur additional costs in the claims process, he said.

The editorial makes the point that no consideration seems to be given to what the fund’s medical service provider clients want, as apparently they were not consulted about the proposal.

It says one possible reason for the proposed amendment is that administrators with their aggregated power have often successfully taken the Compensation Fund to court to get paid. Individual medical service providers would find it harder to do so.

Hopefully, the editorial says, the labour committee will conclude that the proposed prohibition is ill-advised and remove it from the Bill.


Full Business Day editorial (Open access)

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