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- The Council for Medical Schemes says the providers it castigated last week for hiking prices before receiving its go-ahead have since added disclaimers.
- The regulator says it regards the matter as closed.
- Discovery Health CEO Ryan Noach said the scheme is pleased that the matter has been resolved amicably.
- For more financial news, go to the News24 Business front page.
The Council for Medical Schemes (CMS) has withdrawn a directive ordering five of South Africa's most prominent medical schemes to either withdraw their 2024 price and benefit changes or to add a disclaimer saying they haven't yet received a regulatory nod.
On 12 October, the medical schemes authority slammed Discovery Health Medical Scheme (DHMS), Momentum, Medihelp, Bonitas and Bestmed for not complying with the directive, first issued in July.
The CMS said the remaining 66 of the 71 medical schemes it regulates had all complied with its directive that they should not publicise contribution and benefit changes before it had approved them. It has said this process was expected to be completed by November.
READ | Regulator slams top SA medical schemes in battle over 2024 premium hikes
"All five schemes have complied with the directive to either withdraw their communication or add a disclaimer," CMS spokesperson Stephen Monamodi told News24. "All five opted to add a disclaimer to their communication on pricing and benefit changes. We regard the matter as closed."
The actions of the five infringing medical schemes had prompted CMS acting registrar Zongezile Baloyi to write to a letter accusing them of undermining the regulator's authority. Discovery Health CEO Ryan Noach had argued in response that the CMS directive was not legally binding and that no law had been broken by schemes who opted to announce their contribution increases.
However, the regulator hit back, saying that the Medical Schemes Act made it clear that medical scheme rule or contribution changes had to be approved by the registrar before being implemented.
DHMS, which has a 57.6% share of the open medical scheme market in South Africa, initially lodged an appeal against the CMS directive, but Monamodi said the appeal process was no longer required, given that the scheme had now complied with regulations.
"Because they have complied, it means the appeal is now moot, so we don’t have to go through with it," he said. "We had shown them that their previous communications on their website did not have a disclaimer, but they’ve now added it."
Noach said in a statement on Thursday that DHMS was pleased that the matter had been resolved amicably.
"We are comforted that the regulator has prioritised the protection of the interests of members of DHMS to ensure that the members are fully informed, empowered and able to seek timeous advice on year-end changes from their financial advisors," said Noach.
DHMS plans to implement its annual contribution increases and benefit changes on 1 January 2024, subject to the specific approval by the CMS. Noach resigned on 12 October after more than 15 years with Discovery in order to pursue an entrepreneurial opportunity outside of the health and financial services industries.
