The Professional Provident Society group (PPS) has taken over the administration of Profmed, the restricted medical scheme for professionals who are eligible for membership of the society.
PPS started in 1941 as a mutual benefit fund for self-employed professionals. It now consists of a long-term insurance company, a retirement annuity fund and a trust fund for professionals.
Profmed originated in the PPS stable, but the Medical Schemes Act now requires medical schemes to be autonomous non-profit organisations.
Until late last month, Profmed was administered by PPS and Eternity Health. Eternity Health was responsible for most of the back office administration, Graham Anderson, the principal officer of the scheme, says.
However, the Council for Medical Schemes is in the process of accrediting medical scheme administrators and in future only accredited administrators will be able to administer schemes.
Last year, the Council for Medical Schemes denied PPS accreditation as an administrator because it was outsourcing most of the administration of Profmed to Eternity Health.
Anderson says Profmed then had to choose between outsourcing all the administration to Eternity Health or PPS taking over all the administration and re-applying for accreditation as an administrator.
The trustees of Profmed chose the second option, because PPS and Profmed have a strategic alliance in that both use the same criteria for eligibility, Anderson says.
PPS agreed to set up a wholly owned subsidiary called PPS Medical Scheme Administrator (PMSA).
Mike Jackson, the chief executive of PPS, says before 1998 PPS used to administer Profmed, but when the Medical Schemes Act was introduced and it became clear that PPS would have to upgrade its computer systems, the trustees decided to outsource the administration.
Now, Jackson says, it is possible to lease tried and tested computer systems, making it much more feasible for PPS to administer the scheme. He says that Profmed members always hold PPS responsible, regardless of to whom the administration is outsourced.
PPS has hired 50 people with medical scheme administration experience. Nevertheless, Jackson says, there will probably be some hitches in the beginning. But the end result should benefit members, Anderson says, because the scheme will essentially be self-administered and the new administrator will not make a profit.
PMSA has applied to the Council for Medical Schemes for accreditation and Anderson says the council has been involved throughout the process of changing administrators.
Anderson says members were sent letters on August 15 informing them of the change in administrators and PMSA took over the administration of the scheme last week.
Members who need to contact the new administrator should call 0860 679 200. Anderson can be contacted at 011 644 4600. Claims should now be posted to Private Bag X1031, Lyttelton 0141. Profmed's website, www.profmed.co.za, displays the medical scheme's new corporate identity.