Medical Schemes have a right to fund medication or drugs that are on their list (formulary drugs) for given medical conditions. They also have a right to fund the less expensive, but just as effective, formulary drug as the other more expensive formulary drug.

There is no obligation in law for a medical scheme to fund a more expensive drug (whether that is a formulary drug or a non-formulary drug) simply because the member prefers the more expensive drug, or simply because the member’s service provider (or doctor) swears by the more expensive drug.

Where two clinically approved drugs for the treatment or management of a prescribed minimum benefit condition (such as Crohn’s Disease) are available, the one more expensive than the other, the medical scheme is entitled to fund the less expensive drug as long as it is not less effective than the other drug. It  matters not whether both drugs are on the medical scheme’s formulary list or not.

This ruling of the Council for Medical Schemes Appeals Committee (a statutory body set up in terms of the Medical Schemes Act to resolve disputes in the medical schemes space) gives a sense of the relevant factors when a member claims for payment of a specific drug that is not on the medical scheme’s formulary list in circumstances where there is another less expensive drug (also not on the medical scheme’s formulary list) that is proven to achieve the same purpose as the non-formulary drug without adverse effects on the member.

In this case, the medical condition in question is Crohn’s Disease, a prescribed minimum benefit condition. But these factors apply in respect of all prescribed minimum benefit conditions.

Read Full Judgment Bonitas-v-Member