Discovery’s bid to amend re-enrolment rule declined

% 75165 IND = MED 2

% 75165 IND = MED 2

Published Nov 26, 2016

Share

Discovery Health Medical Scheme (DHMS) will not be able to deny membership to applicants whose previous membership of the scheme was terminated because of fraud or non-disclosure.

This follows a ruling by the Appeal Board of the Council for Medical Schemes upholding a decision by the council not to approve an amendment to the scheme’s rules.

DHMS had sought to amend its rules to allow it the discretion to decide whether or not to re-enrol a former member whose membership was terminated because the member had abused benefits or privileges, submitted false claims or otherwise committed fraud against the scheme, or had helped someone to do so.

The Medical Schemes Act provides for schemes to terminate your membership under these conditions. You must then be placed in the same position you would have been in had you never joined the scheme: your contributions must be paid back and all claims paid by the scheme on your behalf must be reversed.

The Act does not distinguish between fraud and non-disclosure, where you omit to disclose material information without intending to commit fraud.

DHMS had sought to amend its rules in 2014 to be able to deny re-enrolment for up to three years under such conditions, but wanted its rules to reflect that it would re-enrol you if it was satisfied there was no intention on your part to commit the act for which your membership was terminated. It argued that allowing members whose membership was terminated to enrol again the very next day is, in effect, no sanction at all.

The Registrar of the Council for Medical Schemes found DHMS’s application to amend its rules to be inconsistent with the Medical Schemes Act, which states that anyone who applies to join an open scheme may not be denied membership. (DHMS is an open scheme.)

The Act also says schemes may only impose a general waiting period of three months and/or a condition-specific waiting period of up to a year when you change schemes, depending on your years of membership and whether you join or rejoin a scheme within three months.

DHMS initially appealed to the Appeal Committee, which upheld the registrar’s decision not to approve the amendment. The scheme then turned to the Appeal Board. The board, chaired by Judge Bernard Ngoepe, upheld the appeal, saying that DHMS’s rule amendment would introduce a waiting period not provided for in the Medical Schemes Act.

OPTIONS DENIED

The Council for Medical Schemes this week published a circular stating that it had denied the approval of seven options that Fedhealth and one that Resolution Health had planned to introduce next year. A number of options with discounts for members who use certain networks are also still subject to approval following an application for exemption from the Medical Schemes Act. These must be considered by the full council.

Related Topics: