The spotlight in the Supreme Court of Appeal this week was on the refusal by a medical scheme to pay for certain medical treatment on behalf of one of its members. Genesis Medical Scheme (‘Genesis’) disputed that it was required to pay for treatment to one of its member dependents, who sustained a severe injury to her leg. The Medical Schemes Act governs all medical aids. In South Africa we have what is commonly referred to as a ‘dual healthcare system’. This means that we have both public and private service providers. Most people who are members of a medical scheme will use the private hospitals.
Ms. J was a member of Genesis medical scheme. Her daughter R was registered as her dependent on the scheme. In 2008, when R was 17 year old, she was involved in an accident in which she severely injured her leg, which required her to have an external prosthesis fitted to her leg. The dispute with the medical scheme revolved around the fact that R’s leg did not properly heal, which necessitated more surgery. When R was later required to travel abroad, she underwent further surgery where the existing external prosthesis was removed and fitted with a custom made boot to make it easier for her to travel.
By 2009 R’s leg had still not properly healed and she was again fitted with another external prosthesis in a private hospital. There was some confusion around the codes given to Genesis, by Ms. J for authorization of the prosthesis, resulting in Genesis saying it will only pay a maximum of R30 000 and not the R75 000,00 actual cost of the prosthesis. Ms. J then complained to the Registrar of Medical Schemes, who ruled in her favour. Genesis refused to accept the Council’s ruling and appealed on two separate issues to the Council’s Appeal Board. Again the Appeal Board found in favour of the member, Ms. J on both counts of the appeal. Genesis remained defiant and then took its fight to the High Court. It asked the High Court to review and set aside the ruling of the Council’s Appeal Board.
The High Court however ruled in favour of Genesis, namely that it was not obliged to pay for the medical treatment in question. The Council of Medical Schemes then appealed the High Court’s ruling to the Supreme Court of Appeal, (which is the highest court in the land). The question which the Supreme Court of Appeal focused on was whether or not Genesis was liable to compensate a member for the cost of an external prosthesis which is fitted in a private hospital and whether the statutory provisions which all medical schemes must abide by, allows for such compensation.
On 16 November 2015 the judges of the SCA delivered its judgment. The presiding judges also looked at the definition of what is meant in law of certain words such as “prescribed minimum benefits”, “emergency medical condition”, ‘ “designated service provider”, “prescribed minimum benefit condition” amongst other things. The SCA said that one of the underlying purposes of the prescribed minimum benefits provisions in the Act and the regulations is to ease the demand upon public resources, which provide hospital and medical services at little or no cost, while at the same time ensuring that members of the medical scheme suffering from prescribed minimum benefits conditions are able to obtain treatment at a satisfactory level. It found that with regard to the issue of the ‘prescribed minimum benefit’ provision, the objective in the Act was two-fold. Firstly it was to ‘avoid incidents where individuals lose their medical scheme cover in the event of serious illness and the consequent risk of unfunded utilization of public hospitals’. Secondly it was to encourage improved efficiency in the allocation of Private and Public health care resources.’ The Supreme Court of Appeal was critical of the stance taken by Genesis in refusing to pay for its member’s medical treatment. It overturned the earlier ruling of the High Court and held that the medical scheme Genesis was required to pay for the costs of the medical treatment.
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