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.
This is a Ruling of the Council for Medical Schemes Appeals Committee, a Specialist Tribunal that determines medical aids or schemes disputes between medical aid members or beneficiaries and medical schemes, or between medical service providers and medical schemes, or between medical schemes and the Registrar of Medical Schemes.
The case concerns
what the appropriate procedure is when a member is aggrieved by a decision of a medical scheme’s internal dispute resolution committee; and
factors applicable in claims for Overseas Treatment Benefit
The member unsuccessfully claimed under the scheme’s Overseas Treatment Benefit for the treatment of her son’s condition (Spastic Deplegic Cerebral Palsy) in the United States on the ground that the procedure (Selective Dorsal Rhizotomy or SDR) is “not routinely available” in South Africa or is “not readily available” in South Africa or no one in South Africa is “experienced enough” to perform the medical procedure.
She then lodged a complaint with the scheme’s internal disputes resolution committee which dismissed her complaint. She had already spent over US$44,000 in the United States for a procedure for which the scheme covers up to R500,000.
From there she was advised, incorrectly, to lodge an appeal directly with the appeals committee of the Council for Medical Schemes under s48 of the Medical Schemes Act, 1998 (the MSA), instead of s47 of the MSA.
Despite this procedural lapse, and the lateness of the appeal, the appeals committee decided to determine the matter on its merits because of the importance of the issue that arose.
The lesson in this case is the importance of reading and understanding the applicable medical scheme rules and benefit option provisions before embarking on costly medical interventions overseas.
R equirements for the termination of medical scheme membership on grounds of non-disclosure of material information by a member at the time of joining the scheme. Many people tend to advance as a defence when caught out that they had no intention of withholding the information from the scheme (typically a pre-existing medical condition) and that, in any event, because they have been dutifully paying their premiums or contributions to the medical scheme and the scheme has been accepting them, the scheme cannot terminate their membership for non-disclosure which it should have discovered long ago and not only when a substantial claim is lodged. This ruling explains that this is not a relevant consideration.