The Supreme Court of Appeal (SCA) has agreed to hear arguments in the Board of Healthcare Funders’ application to appeal against a judgment that dismissed its application to compel the Council for Medical Schemes (CMS) to permit medical schemes to offer low-cost benefit options (LCBOs).
LCBOs are pared-down plans excluding the expensive treatments included in the Prescribed Minimum Benefits (PMBs) that schemes are required to provide in terms of the Medical Schemes Act (MSA).
The BHF represents about 40 schemes and medical scheme administrators that serve some 4.5 million beneficiaries.
In its application to the High Court in Pretoria, the BHF sought several orders, including:
- Declaring certain decisions by the CMS and/or the Registrar of Medical Schemes – such as granting exemptions to health insurance providers under section 8(h) of the MSA, imposing a moratorium on medical schemes offering LCBOs, and refusing to entertain LCBO exemption applications – as irrational, unreasonable, and/or unlawful under the Promotion of Administrative Justice Act and section 1(c) of the Constitution.
- Declaring the CMS and the Minister of Health’s failure to develop and implement LCBO guidelines as irrational, unreasonable, and/or unlawful.
- Directing the CMS to grant general exemptions or consider individual exemption applications for medical schemes to offer LCBOs without PMBs.
In April, the High Court dismissed the BHF’s application on both procedural grounds and the merits.
Read: Major setback for medical schemes in legal battle over low-cost options
In an order dated 25 September, the SCA agreed to hear oral arguments on the BHF’s application to appeal the ruling and said the parties should be prepared to address the merits of the case.
In a statement released yesterday, the BHF said it believed the High Court erred in narrowly interpreting the BHF’s standing and failed to properly consider the constitutional implications of withholding access to affordable healthcare solutions from millions of citizens. “We are confident that the SCA, with its broader constitutional mandate, may come to a different conclusion – one that protects access, promotes equity, and enables innovation in healthcare financing.”
The BHF asserts that LCBOs will enable an additional 10 million low-income South Africans who cannot afford full medical scheme cover to buy primary healthcare in the private sector instead of paying for these services out of pocket.
Medical schemes are prohibited from offering LCBOs because of the absence of a regulatory framework, despite the CMS having been formally mandated to establish such a framework as far back as 2015, it said.
The BHF believes the CMS and the Department of Health are delaying LCBOs in favour of implementing National Health Insurance (NHI). Yet, the full implementation of NHI is years away and remains the subject of multiple legal challenges, including the BHF’s Constitutional Court challenge. “In the meantime, millions of South Africans are left without access to affordable healthcare coverage,” it said.
Health Minister Dr Aaron Motsoaledi has expressed opposition to LCBOs, viewing them as a “step backwards” that lack supporting research, do not adequately cover low-income-earners, and benefiting medical schemes them without providing value, because similar benefits can be accessed more affordably through public healthcare facilities.
