1) A provider of a service who has delivered any service to a individual in terms of which an account has been provided, will, in spite of the conditions of any other legislation, supply to the customer involved an account or statement reflecting such particulars as may be given; 2) A medical plan shall, in the case where an account has been rendered, susceptible to the conventions of this Act along with procedures from the medical scheme concerned, pay out to a member or supplier of service, any kind of reward due to that member or supplier of service inside of four weeks following the day by which the claim in regard of such bonus was gained by the medical scheme".
The concern arises whether this section merely allows medical schemes to repay service providers directly or whether it does in reality create a responsibility on medical schemes to generate payments directly to providers, as happens to be debated by service providers.
The Top Court of Appeal, in Medscheme Holdings (Pty) Ltd and Another v Bhamjee [2005] ALL SA 16 (SCA), learned that Mr Bhamjee, a medical practitioner, didn't have basis upon which to insist that Medscheme (an authorized medical scheme) pay him directly.
On this decision, the Court appeared to acknowledge that even though section 59(2) creates a base upon which medical schemes are allowed to discharge obligations due to customers by reimbursing service providers directly, the section does not force a medical scheme to do this when the provider had lodged an account with the medical scheme.
This viewpoint was verified in the fairly 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 particular case the Applicant (a service provider) applied to Court on an critical grounds for an order instructing that the Respondent (an authorized medical scheme) generate payment to them directly, but not to their members.
The Applicant contended that the key phrase in section 59(2) of the Act is "benefit due to the customer or service provider of the service" which with a common-sense interpretation of the section it means that where a member hasn't paid the supplier of the service the medical scheme has no discretion but is obligated to pay the supplier.
A Legal Court failed to agree with this argument, and held that section 59(2) should be considered in context. Subsection (1) provides that the supplier of a service that has rendered a service is obliged to provide the member related to an account that contains prescribed particulars. Subsection (2) then provides that whenever such an account is rendered the medical scheme can pay to the member or supplier of the service the benefit owing to that member or provider of the service.
The Court also held that, in the context of the section, the benefit owing must reference the total amount due by the member to the provider for the services provided. The Court stated that it's immaterial that the benefit results in being owing to the customer by virtue of the agreement between the customer and the medical scheme and, to the supplier, by virtue of the contract between the member and the supplier. The subsection doesn't build an obligation on the medical scheme to pay the provider.
Moreover, the Court held that the subsection undoubtedly provides that repayment is subject to the rules of the medical scheme, and in the case of the Respondent its regulations mentioned unambiguously how the Respondent has got the right to pay either the member or the supplier of the service.
Consequently, the Court determined no grounds for a duty on the Respondent to pay the Applicant directly and dismissed the application along with fees.
From the above it's obvious that in order to ensure repayment for services provided by companies must either claim payments straight from their patients, or make sure that they have contractual arrangements with all the medical schemes. For now, our Courts seem reluctant to demand a statutory responsibility on medical schemes to make repayment straight to service providers in the absence of this type of contractual agreement.
The concern arises whether this section merely allows medical schemes to repay service providers directly or whether it does in reality create a responsibility on medical schemes to generate payments directly to providers, as happens to be debated by service providers.
The Top Court of Appeal, in Medscheme Holdings (Pty) Ltd and Another v Bhamjee [2005] ALL SA 16 (SCA), learned that Mr Bhamjee, a medical practitioner, didn't have basis upon which to insist that Medscheme (an authorized medical scheme) pay him directly.
On this decision, the Court appeared to acknowledge that even though section 59(2) creates a base upon which medical schemes are allowed to discharge obligations due to customers by reimbursing service providers directly, the section does not force a medical scheme to do this when the provider had lodged an account with the medical scheme.
This viewpoint was verified in the fairly 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 particular case the Applicant (a service provider) applied to Court on an critical grounds for an order instructing that the Respondent (an authorized medical scheme) generate payment to them directly, but not to their members.
The Applicant contended that the key phrase in section 59(2) of the Act is "benefit due to the customer or service provider of the service" which with a common-sense interpretation of the section it means that where a member hasn't paid the supplier of the service the medical scheme has no discretion but is obligated to pay the supplier.
A Legal Court failed to agree with this argument, and held that section 59(2) should be considered in context. Subsection (1) provides that the supplier of a service that has rendered a service is obliged to provide the member related to an account that contains prescribed particulars. Subsection (2) then provides that whenever such an account is rendered the medical scheme can pay to the member or supplier of the service the benefit owing to that member or provider of the service.
The Court also held that, in the context of the section, the benefit owing must reference the total amount due by the member to the provider for the services provided. The Court stated that it's immaterial that the benefit results in being owing to the customer by virtue of the agreement between the customer and the medical scheme and, to the supplier, by virtue of the contract between the member and the supplier. The subsection doesn't build an obligation on the medical scheme to pay the provider.
Moreover, the Court held that the subsection undoubtedly provides that repayment is subject to the rules of the medical scheme, and in the case of the Respondent its regulations mentioned unambiguously how the Respondent has got the right to pay either the member or the supplier of the service.
Consequently, the Court determined no grounds for a duty on the Respondent to pay the Applicant directly and dismissed the application along with fees.
From the above it's obvious that in order to ensure repayment for services provided by companies must either claim payments straight from their patients, or make sure that they have contractual arrangements with all the medical schemes. For now, our Courts seem reluctant to demand a statutory responsibility on medical schemes to make repayment straight to service providers in the absence of this type of contractual agreement.
About the Author:
Learn about medical law and the medical schemes act from the best in the industry. Dirk Markhen is a specialist medical attorney practicing the law of medicine.
Read More …
