AGM questions & answers
As promised, we are reporting back on the questions and answers raised at the AGM. This edition covers the last set of questions, raised by Dr Brink, all of which have been paraphrased and answered individually.
“There is an ever-increasing divide between the SRR and the realistic fees currently charged by providers. It is deceptive to describe a benefit as 100% of SRR, when it bears little relation to the actual cost. The actual SRR is not published, so it is increasingly disingenuous to describe benefits as a percentage of a hidden schedule. There are huge discrepancies between the relative value of the SRR for radiologists and pathologists, when compared to anaesthetists, surgeons, physicians and other specialists.” We agree with Dr Brink, there is an increasing divide between the SRR and actual medical costs experienced by members; further, there are large variations between disciplines. Part of this answer has already been given in the October edition of MediBrief.
The CPI and medical CPI differential automatically widens the gap if members and pensioners receive CPI-related increases (which schemes tend to follow when increasing their benefits to keep contributions down) and providers use medical CPI as their annual tariff increase.
On referring to tariff variation, again, we agree. We still have providers who charge around the 100% SRR, whereas others charge 400% and more. A few even charge in the 1 000s of a % of the SRR.
Competition Law allows each provider to set their own tariff which should be based on their direct costs and on what their market can bare — which is a very important principle. If you, their market, are willing to pay their rate, it is deemed acceptable.
Regarding the comment on the SRR being a hidden schedule, as mentioned, the actual tariff schedule cannot be easily published and even if it were, we doubt the most informed member would be able to navigate it. Unfortunately, there really isn’t an easy solution and, if there were, it would be commonly used.
There is no deliberate attempt to deceive anybody, which is why we offer the service to give the SRR based on a quotation from a practitioner, and even that comes with a disclaimer.
“The R3 200 co-payment on endoscopic procedures carried out at non-network hospitals is unfair.”
Any co-payment should aim to have members receive the most appropriate treatment in the most appropriate facility or by the most appropriate provider at the most appropriate cost. It should aim to reduce unnecessary wastage, be set at a rate that is sufficient to incentivise behavioural change while still having some bearing on the actual costs, and ultimately improve overall cost efficiencies.
The co-payments are regularly discussed and reviewed in the best interest of all members. For 2021 it was decided to not increase the co-payments.
“If the cost of endoscopies is a problem, why does the Scheme not simply publish a Rand limit to the facility payment, regardless of which facility is used?”
If there was one flat co-payment, there would be no incentive for any hospital to compete and offer a lower cost service. Nor would it drive behavioural changes of either the provider or the member. Ideally, one would like day clinics to become far more prevalent and regularly used for day procedures. They should be the members’ place of choice for safety and convenience while hospitals should be only accessed when really needed.
“If an endoscopy co-payment is necessary, why not make it reasonable in every case and apply it to all members regardless of which facility is used?”
It would not drive any efficiencies or better outcomes, nor have any impact on the total ‘event’ cost as already mentioned.
Historically, a scheme would simply have used a limit while modern thinking is more focused on the longer-term outcomes and co-payment or risk-sharing strategies aimed at correcting some of the drivers of healthcare inflation. If we set a limit, in three years’ time one could argue the limit bears no resemblance to the actual cost, whereas if it is a negotiated network at least one has a willing provider/willing payer arrangement which should be much more sustainable.
As with all benefit reductions or restriction, members are not half as happy as when benefits are increased, even if it is for the long-term good of the Scheme. Cost containment tends to be uncomfortable. We hear you and understand the difficulties and assure you it will be discussed further by the relevant Committees and no doubt the Board.