Regulator can't force Gems to fund drug
The Council for Medical Schemes (CMS) regulates 80 medical aids in a R160bn industry, but don't expect a speedy, clear or consistent response when challenging a medical aid for life-saving treatment.
The "regulator" has been "derelict" in its duties, said Wits School of Governance adjunct professor of governance Alex van den Heever, speaking about a case in which it has failed to enforce a ruling made against the Government Employees Medical Scheme (Gems) to provide a life-saving treatment.
The urgent case for the patient with a rare condition called Gaucher disease, which requires medicine costing more than R3m a year to treat, has been at the CMS for more than a year and remains unresolved.
The patient is getting sicker, her doctor has testified. The patient won her case at the CMS in March last year, and won an appeal in October when the council ruled that medicine must be provided because it is life-saving.
But the council is not enforcing its appeal board ruling that Gems must provide the medicine - because Gems is appealing again.
However, lawyers and Van den Heever told Business Times that the CMS has previously enforced its appeals rulings and even argued in court in December, in a different case, that its appeal board decisions are binding.
Patient rights advocate Kelly du Plessis and lawyer Elsabé Klinck have been trying for four months to get the regulator to enforce the appeal board decision in October that Gems must pay for the treatment.
Last week, Du Plessis and Klinck's year-long battle at the CMS reached absurdity when a lawyer at the regulator e-mailed them to say the CMS had lost its authority to issue directives (binding orders) to medical schemes and make them comply.
In an e-mail seen by Business Times, the lawyer writes to Du Plessis's lawyer: "The registrar used to have powers to issue directives under the Inspection of Financial Institutions Act. The act has since been repealed by the Financial Sector Regulation Act, which means the CMS can no longer rely on it. All that is left for us to do is impose penalties."
Du Plessis said: "What is the point of a regulator that can't regulate?"
Klinck added: "If the CMS is not within its powers to enforce any ruling that it . has made, why would anyone bother with utilising the complaints and appeals systems?"
She said the council had enforced its rulings before and failure to do so for this patient was unconstitutional as everyone had the right to be treated equally before the law.
The letter from the CMS's legal adviser explained that the council was unable to enforce Gems to comply because Gems was challenging its interpretation of the law.
"In addition to the above, the scheme [Gems] in this instance is challenging our legal opinion on the suspension of rulings pending a section 50 appeal. In the past our views were accepted and complied with. All of this places us in a difficult position."
The CMS has for two months promised Du Plessis to get an external legal opinion on how it and Gems disagree, but said in March red tape was slowing it down.
Van den Heever said this excuse was "absolute nonsense. I have never heard of a regulator, in an important matter, not being able to get a legal opinion. It is their job to do so."
He also said it did happen that schemes dragged out legal matters, though Gems said it was trying to resolve the issue. "It is worthwhile to the scheme to drag out such cases because Gaucher disease is so expensive to treat. This is even where they expect to lose. In some cases patients can die while waiting for expensive treatment."
The anomalies and delays have left Du Plessis asking what exactly the CMS "regulates" and whether it is powerful enough to hold schemes to account.
After media queries, the CMS distanced itself from the letter and the assertion that it had lost its power over medical schemes - blaming the misinterpretation of the law and the letter on a "frolic" by a rogue official.
Spokesperson Grace Khoza said: "I must place it on record that the document you sent me in the e-mail under reply does not carry any CMS standing. If indeed it was issued by a CMS official, such official was on their own frolic and its contents cannot be attributed to CMS in any form."
Khoza added that the regulator had not lost its power and medical aids were allowed to challenge it.
"Where schemes are in disagreement with the council, schemes are constitutionally entitled to litigate and resist instructions and directives of the council. Accordingly, we do not consider the council powerless when medical schemes exercise their legal right to challenge decisions of the council. The registrar, together with the council, may suspend and ultimately cancel registration of a medical scheme if, after written notice from the registrar, it persists in violation of any provisions of the Medical Schemes Act."
Khoza said the CMS did have the power to issue directives.
But the issue is still not resolved.
Though most decisions have been enforced after the first appeal process, that is not the case here after the Gems challenge. Khoza said only the final decision on treatment would be binding even if the case went all the way to the highest court in the land.
Gems has denied prolonging the case since 2016 and said it was trying to resolve it speedily. Gems principal officer Guni Goolab said: "Gems is fully subject to and remains compliant to the prescripts of the Medical Schemes Act, the statutory rules and regulations set out by the CMS."