Low Cost Benefit Options for Medical Schemes

The Council for Medical Schemes (CMS) published Circular 54 of 2015 which contains details of the framework and principles to allow the introduction of Low Cost Benefit Options (LCBOs) within the medical schemes industry.

The Circular makes provision for exemptions under the Medical Schemes Act. Interested parties can apply to make these benefits available to specified clients.

These exemptions are:

  1. Open enrolment
  2. Prescribed minimum benefits and
  3. Broker remuneration

The Council prescribes a minimum set of predefined mandatory benefits geared towards preventative and primary healthcare, management of acute conditions and a limited set of chronic conditions. Furthermore, a defined list of mandatory LCBO essential drugs, pathology tests, radiology tests, dental procedures and a limited chronic condition list must be included as part of the benefit offering.

Contribution rates are expected to be between R180 to R300 per beneficiary per

Membership of the LCBO shall be restricted to members whose income is below the tax threshold as published by the SARS in the benefit year.

Broker fees will be based on a staggered scale, up to a maximum of R25 per member.

Please click here to download Circular 54 of 2015.

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