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South African medical schemes divided on vaccine funding model

PUBLISHED: Fri, 29 Jan 2021 13:01:01 GMT

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By Emma Rumney and Alexander Winning

JOHANNESBURG, Jan 29 (Reuters) – Days before coronavirus vaccinations start in South Africa, medical schemes have still not agreed how and to what extent they will contribute to the cost of inoculations for people without insurance cover, industry executives told Reuters.

South Africa is expecting its first 1 million doses of the AstraZeneca vaccine to land on Monday and will start immunising health workers from mid-February. The country has been the hardest-hit by the COVID-19 pandemic on the continent, with more than 1.4 million cases and over 43,000 deaths to date.

A top medical scheme administrator, Discovery Health , said earlier this month that medical schemes, funds that pool member contributions to cover healthcare costs, had agreed to pay above cost for vaccine doses for their members – roughly 7 million adults over the age of 15 – thereby “cross-subsidising” procurement for another 7 million adults without private cover.

But other schemes or their administrators said the industry had not yet formally agreed those parameters and there were different views on how to proceed. More than 80% of South Africa’s population of roughly 60 million are not covered by medical schemes.

“The principle of cross-subsidy we are 100% on board with, but the level, … I think needs to be discussed,” said Damian McHugh, executive head of sales and marketing at Momentum Health Solutions.

He said medical schemes were able to contribute to different extents, adding that an agreement could reached as soon as next week. “These things move quite rapidly, … there are meetings that were held last night, there are meetings today,” McHugh said on Friday.

Fedhealth Chief Executive Jeremy Yatt said the cross-subsidy proposal was legally complicated, adding “as an industry we are very confused as to why (Discovery) are so hot to trot on this particular idea. … There’s lots of governance and technical problems.”

Discovery Health told Reuters: “Uncertainty still remains around the ultimate funding arrangements. … Various iterations of models are still being discussed”.

Medshield Medical Scheme and Bonitas Medical Fund said they needed more information from the government and that some details still needed to be ironed out.

Profmed said one proposal under discussion would place a greater financial burden on medical schemes than the government or companies, and alternatives should be discussed.

The National Treasury said this week that the government was still talking to medical schemes about their contribution. The government also expects businesses like mining companies to chip in.

($1 = 15.1150 rand) (Reporting by Emma Rumney and Alexander Winning Editing by Olivia Kumwenda-Mtambo and Frances Kerry)

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