54 CME January 2004 Vol.22 No.1 M E D I F I L E
On 4 November 2002, changes to the Regulations of the Medical Schemes Act (Act No. 131 of 1998) were gazetted, some of which have been implemented in 2003.
On 1 January 2004 the remaining changes to the
Regulations will be implemented, including the introduction of Prescribed Minimum Benefits (PMBs) for the Chronic Disease List (CDL). The treatment algorithms have now been legislated and published in the Government GazettteNo.
25537 of 6 October 2003, Notice No. 1397.
TERMINOLOGY
Designated service provider (DSP)
This refers to health care provider/s that have been 'select- ed by the scheme to provide its members diagnosis, treat- ment and care in respect of one or more of the PMB condi- tions'.
Emergency medical condition
This is a condition which is of sudden and unexpected onset requiring immediate medical or surgical treatment.
Failure to provide this treatment would result in impairment of bodily functions, serious dysfunction of a bodily organ or part, or would place the person's life in serious jeopardy.
Prescribed minimum benefits (PMBs)
PMBs are minimum benefits which by law must be provided to all medical scheme members and include the provision of diagnosis, treatment and care costs for:
• any emergency medical condition
• a range of conditions as specified in Annexure A of the Regulations to the Medical Schemes Act (No. 131 of 1998), subject to limitations specified in Annexure A. Included in this list of conditions is the list of chronic conditions.
PMBs for the chronic disease list CDL
The PMBs for the CDL differ from the general list of PMBs in that their minimum treatment is specified in therapeutic algorithmsfor each condition.
WHY HAVE PMBs BEEN LEGISLATED?
PMBs were introduced to avoid incidents where individuals lose their medical scheme cover in the event of serious ill- ness and are put at serious financial risk due to unfunded utilisation of medical services. They also aim to encourage
improved efficiency in the allocation of private and public health care resources.
WHAT RESTRICTIONS ARE ALLOWED IN THE MANAGEMENT OF CDL PMBs?
A medical scheme may:
• Limit the treatment in accordance with the gazetted ther- apeutic algorithms.
• Apply managed care interventions to improve the effi- ciency and effectiveness of health care provision (refer to Medifile in the February issue of CME).
• Apply a co-payment or deductible if:
• The health care service was obtained from a provider otherthan the scheme's selected DSP. Refer to the sec- tion on ‘managing the costs of PMBs’ mentioned below for exceptions to this rule.
• The patient knowingly declines an appropriate, effec- tive formulary drug and opts to use another drug instead.
The amount of the co-payment or deductible has to be spec- ified in the medical scheme's rules. The Council for Medical Schemes has however stipulated that the co-payment may not be 100% and that it should be based on the difference between the actual cost incurred and the cost that would have been incurred if the DSP services or formulary drug had been used.
A medical scheme may not:
• Impose a condition-specific waiting period for a new member.
• Impose a co-payment, other than in the instances as mentioned above.
• Use a member's medical savings account (MSA) to pay for any cost arising from a PMB condition.
The chronic conditions to which the PMBs apply are listed in Table I.
IDENTIFYING PMB CONDITIONS
The algorithms for each of the conditions on the CDL speci- fy the ICD 10 diagnosis codes applicable to each condi- tion. In order to ensure that your patient's claim is processed as a PMB claim it is imperative that the correct ICD 10 code is submitted with the claim.
From 1 January 2004 many medical schemes will only process a claim as a PMB claim if the relevant ICD 10
PRESCRIBED MINIMUM BENEFITS
FOR THE CHRONIC DISEASE LIST
diagnosis code and other item and procedure codes for the relevant health services are provid- ed.However, as the majority of pharmacist practice man- agement software systems do not enable ICD 10 coding and the exact diagnosis is not always known by the phar- macist, it is expected that medical schemes may, in the interim, apply an exception to pharmacists.
It is expected that a scheme will require confirmation of the diagnosis of a CDL condition, together with its ICD 10 code, before PMBs will be covered, e.g. pre-registration of the patient with the condition will be required, except in the case of an emergency.
Impact on the service providers
Service providers will have to be able to allocate diagnosis codes and procedure codes accurately and submit the claim under a PMB option to enable the medical schemes to accu- rately identify the treatment as being for a PMB condition.
Impact on medical schemes
Medical schemes will need to be able to identify the submit- ted codes which are part of the PMB conditions to ensure that payment is made from the correct benefit.
MANAGING THE COSTS OF PMBs
The immediate fear of the health care industry is that the PMB legislation for these chronic conditions will result in an increase in costs to the schemes, and as the PMBs are fund- ed by scheme members and not by the industry, increased costs can create hardship for those it is trying to benefit.
Thus it is imperative that the costs relating to the PMBs are carefully managed. Costs include the direct cost of the serv- ices as well as the managed health care costs and adminis- trative costs.
Designated providers
Medical schemes may select designated service providers and negotiate special rates or charges for all members of their scheme/s. The public hospitals may also be selected.
All members should obtain services for PMB conditions from these providers. If the member uses an alternative provider, then the scheme may impose a co-payment or deductible. If the service was involuntarily obtained, no co-payment of deductibles may be applied. Services would be deemed to have been involuntarily obtained if:
• it was an emergency medical condition
• the service was not available from the designated provider or could not be provided without unreasonable delay
• immediate medical or surgical treatment for a PMB con- dition was required and ability to obtain treatment from a designated service provider was not possible
• there is no designated service provider within reason- able proximity of the beneficiary's residence or place of work.
As the legislation has not defined the terms ‘unreasonable delay’, ‘reasonable proximity’ and ‘reasonably precluded’, it is expected that each scheme will define these terms in their own rules.
Next month's Medifile will deal with the costs incurred by medical schemes, medical scheme members and costs to providers as well as the impact on all aspects of the med- ical supply chain.
M E D I F I L E
January 2004 Vol.22 No.1 CME 55
TABLE I. THE CHRONIC DISEASE LISTAddison’s disease Diabetes insipidus Hypertension
Asthma Diabetes mellitus type 1 and 2 Hypothyroidism
Bronchiectasis COPD Multiple sclerosis
Cardiac failure Dysrhythmias Parkinson’s disease
Cardiomyopathy Epilepsy Rheumatoid arthritis
Chronic renal failure Glaucoma Schizophrenia
Coronary artery disease Haemophilia Systemic lupus erythematosus
Crohn’s disease Hyperlipidaemia Ulcerative colitis
Bipolar disorder, which was previously gazetted as being on the CDL is to be removed as most drugs used to treat this condition are not registered with the MCC for this indication. It is however listed as one of the original treatment-condition pair PMBs (code 902T).
