By Katlego Mothudi
The National Health Insurance Act (NHI) has understandably dominated the news over the past few months because of its profound implications for our country’s health system.
However, there is another matter that deserves attention as it poses a serious threat to achieving universal health coverage in South Africa.
This is the Road Accident Fund’s (RAF’s) refusal to reimburse hundreds of millions of rand to medical schemes for expenses incurred by members injured in road accidents, which puts the sustainability of the sector at risk.
In the past, the RAF reimbursed medical schemes for these medical expenses if the members’ claims were approved by the fund.
This was in accordance with the RAF Act, which states that the fund is liable for compensating all road accident victims for the medical expenses they incur, provided they weren’t solely responsible for causing the accident.
However, in August 2022, the RAF issued a directive that all claims for medical expenses which had already been paid by claimants’ medical schemes must be rejected. As a result, medical schemes lost a critical income scheme which has impacted their ability to provide affordable, quality health cover to millions of South Africans.
There is a perception that medical schemes are the preserve of only one privileged group in South Africa. However, the fact is that 68% of medical scheme members come from previously disadvantaged groups.
In other words, it is hard-working citizens from all backgrounds who lose out when medical schemes have no choice but to increase premiums to compensate for the money owed by the RAF.
These same medical scheme members contribute to the fund through the RAF fuel levy, which means they are being denied road accident cover that they have paid for. This levy equates to R2.18 for every litre of fuel purchased by motorists, with the RAF receiving more than R45 billion a year via this funding stream.
Despite this, the RAF has doggedly stuck to its unlawful decision – even ignoring a High Court judgment handed down two years ago. The court ruled, in no uncertain terms that the RAF may not withhold payments for medical expenses incurred by medical scheme members injured in road accidents.
To make matters worse, both the RAF’s subsequent appeals to the Supreme Court of Appeal and the Constitutional Court respectively were unsuccessful.
So, although the original high court order stands, the RAF has continued to withhold these payments with the total owed to medical schemes climbing by the day.
As a result, the RAF was recently dragged back to the Gauteng High Court which has been asked to declare that the fund is in breach of its previous ruling and to order it to resume paying medical scheme claims.
While we eagerly await the outcome of this case, the courts are not the only way to force to the fund to comply with the RAF Act.
Both the Minister of Transport and Parliament have oversight authority over the RAF to ensure it delivers on its mandate.
The recent acknowledgement by newly appointed Minister of Transport Barbara Creecy for urgent policy and administrative reform at the RAF is a welcome development.
While the massive backlog in the processing of claims is her key focus, we encourage her to terminate the 2022 directive and order the immediate reimbursement of the hundreds of millions of rand owed to medical schemes.
It is in everybody’s interest that we ensure medical schemes are able to provide affordable, quality health coverage to beneficiaries, many of whom are government employees.
It is therefore critical that both the minister and Parliament ensure that the RAF fulfils its statutory and legal obligation to pay back the money owed.
The Board of Healthcare Funders, which represents more than 40 medical schemes and administrators, covering 4.5 million beneficiaries in South Africa, is committed to helping achieve universal health coverage, so no one is left behind.
We hope that this crisis is urgently resolved, so that the medical scheme sector can continue playing a critical role in ensuring the long-term viability of South Africa’s healthcare system by providing access to affordable, quality health coverage.
Katlego Mothudi is the managing director of the Board of Healthcare Funders (BHF)