The Council for Medical Schemes (CMS) released a statement on Tuesday noting and accepting the ruling delivered by the North Gauteng High Court in Pretoria.
This comes after the CMS approached the high court seeking general guidance on unregistered healthcare products currently conducting the business of medical schemes without due registration.
In 2020, both Discovery Health and a division of the private hospital group Netcare separately launched a convenient way to access private, day-to-day healthcare by selling prepaid doctor consultation vouchers to South Africans who cannot afford medical aid.
However, the medical scheme regulator tried to prevent Netcare and Discovery Health from selling prepaid vouchers aimed at South Africans without traditional medical scheme cover.
The high court rejected its bid to end healthcare vouchers in a judgment delivered on 13 October 2023 with the judge ruling that the matter must proceed before an internal appeal.
“Section 20 (1) of the Medical Schemes Act (MSA) makes it abundantly clear that no person shall carry on the business of medical schemes unless that person is registered as a medical scheme.
“CMS sought a declaratory order against the conduct of these entities that are currently providing vouchers intended to fund medical expenses in contravention of section 20 (1) of the MSA,” the regulator said.
They also cited Section 6 of the Financial Institutions Act 28 of 2001 which allows the registrar to approach the high court to discharge any duty or responsibility imposed on him in terms of any law, compel any institution to comply with any law or to cease contravening a law or to comply with a lawful directive, and to obtain a declaratory order relating to any law or business of an institution.
“However, in this regard, the North Gauteng High Court was of the view that the internal Appeals Committee of CMS should first deal with the matter, and the Appeals Board should it be necessary before the matter can be brought before it.
“The CMS holds the view that the issue of vouchers used to fund medical expenses goes beyond the current cited parties in the dispute and therefore it would have been properly addressed by a decision of the high court which sets a precedence than by a decision of the Appeals Committee which does not,” the regulator explained.
CMS has since elected to abide by the judgement and is looking forward to the hearing before the Appeals Committee.
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