1) A provider of a service who has performed any kind of service to a beneficiary in terms of which an account has been rendered, will, in spite of the conditions of any other regulation, furnish to the member concerned an account or statement highlighting such particulars as may be prescribed by doctors; 2) A medical scheme will, in the case where an account happens to be provided, subject to the specifications of this Act and the regulations of the medical scheme concerned, pay to a member or provider of service, any kind of benefit due to that member or supplier of service within four weeks after the day on which the claim in regard of such benefit was obtained via the medical scheme".
The query takes place whether this section just allows medical schemes to pay service providers directly or whether it does in fact create a duty on medical schemes to generate repayments directly to providers, as has been debated by service providers.
The Top Court of Appeal, in Medscheme Holdings (Pty) Ltd and the other v Bhamjee [2005] ALL SA 16 (SCA), learned that Mr Bhamjee, a doctor, had no grounds upon which to demand that Medscheme (an authorized medical scheme) pay him directly.
In this judgement, the Court appeared to acknowledge that although section 59(2) produces a foundation on which medical schemes are permitted to expel commitments owed to customers by reimbursing providers directly, the section doesn't oblige a medical scheme to do this where the service provider had lodged an account with the medical scheme.
This view was confirmed in the recently decided and reportable matter of Tshwane Pharmacy (Pty) Ltd v GEMS that was observed by the North Gauteng High Court under case number 28532/11.
In this situation the Applicant (a service provider) applied to Court on an emergency basis for an order directing that the Respondent (an authorized medical scheme) generate payment directly to them, and not to their members.
The Applicant contended the key phrase in section 59(2) of the Act is "benefit owing to the customer or provider of the service" which with a common-sense interpretation of the section it means that where a customer hasn't paid the supplier of the service the medical scheme has no discernment but is required to pay the supplier.
A Legal Court didn't concur with this debate, and held that section 59(2) must be considered in context. Subsection (1) provides that the provider of the service who has rendered a service is required to furnish the member concerned with an account comprising prescribed particulars. Subsection (2) then provides anytime this type of account is provided the medical scheme can pay to the member or the supplier of the service the bonus due to that member or provider of the service.
The Court also retained that, in the context of the section, the bonus outstanding must reference the amount outstanding by the member to the provider for the services supplied. The Court claimed that it is inconsequential that the benefit becomes due to the member by virtue of the arrangement between the member and the medical scheme and, to the supplier, by virtue of the commitment involving the member and the supplier. The subsection does not build an obligation on the medical scheme to repay the provider.
Additionally, the Court held that the subsection clearly provides that payments is subject to the policies of the medical scheme, and in the case of the Respondent it's regulations claimed unambiguously that the Respondent has got the right to pay out either the customer or the provider of the service.
Accordingly, the Court identified no cause for a responsibility on the Respondent to repay the Applicant directly and laid off the application with fees.
From the above it's clear that in order to guarantee repayment for services provided by service providers ought to either claim repayment straight from their patients, or make sure that they have contractual agreements with all the medical schemes. Right now, our Courts appear to be reluctant to impose a statutory obligation on medical schemes for making repayment straight to service providers in the absence of such a contractual arrangement.
The query takes place whether this section just allows medical schemes to pay service providers directly or whether it does in fact create a duty on medical schemes to generate repayments directly to providers, as has been debated by service providers.
The Top Court of Appeal, in Medscheme Holdings (Pty) Ltd and the other v Bhamjee [2005] ALL SA 16 (SCA), learned that Mr Bhamjee, a doctor, had no grounds upon which to demand that Medscheme (an authorized medical scheme) pay him directly.
In this judgement, the Court appeared to acknowledge that although section 59(2) produces a foundation on which medical schemes are permitted to expel commitments owed to customers by reimbursing providers directly, the section doesn't oblige a medical scheme to do this where the service provider had lodged an account with the medical scheme.
This view was confirmed in the recently decided and reportable matter of Tshwane Pharmacy (Pty) Ltd v GEMS that was observed by the North Gauteng High Court under case number 28532/11.
In this situation the Applicant (a service provider) applied to Court on an emergency basis for an order directing that the Respondent (an authorized medical scheme) generate payment directly to them, and not to their members.
The Applicant contended the key phrase in section 59(2) of the Act is "benefit owing to the customer or provider of the service" which with a common-sense interpretation of the section it means that where a customer hasn't paid the supplier of the service the medical scheme has no discernment but is required to pay the supplier.
A Legal Court didn't concur with this debate, and held that section 59(2) must be considered in context. Subsection (1) provides that the provider of the service who has rendered a service is required to furnish the member concerned with an account comprising prescribed particulars. Subsection (2) then provides anytime this type of account is provided the medical scheme can pay to the member or the supplier of the service the bonus due to that member or provider of the service.
The Court also retained that, in the context of the section, the bonus outstanding must reference the amount outstanding by the member to the provider for the services supplied. The Court claimed that it is inconsequential that the benefit becomes due to the member by virtue of the arrangement between the member and the medical scheme and, to the supplier, by virtue of the commitment involving the member and the supplier. The subsection does not build an obligation on the medical scheme to repay the provider.
Additionally, the Court held that the subsection clearly provides that payments is subject to the policies of the medical scheme, and in the case of the Respondent it's regulations claimed unambiguously that the Respondent has got the right to pay out either the customer or the provider of the service.
Accordingly, the Court identified no cause for a responsibility on the Respondent to repay the Applicant directly and laid off the application with fees.
From the above it's clear that in order to guarantee repayment for services provided by service providers ought to either claim repayment straight from their patients, or make sure that they have contractual agreements with all the medical schemes. Right now, our Courts appear to be reluctant to impose a statutory obligation on medical schemes for making repayment straight to service providers in the absence of such a contractual arrangement.
About the Author:
Learn about medical law and the medical schemes act from the best in the industry. Dirk Markhen is a specialist construction attorney also practicing the law of medicine.
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