1) A supplier of a service who's rendered any kind of service to a beneficiary with regards to which an account has actually been provided, shall, despite the provisions of any other law, supply to the member concerned an account or statement highlighting such information as might be given by doctors; 2) A medical plan shall, in the case where an account happens to be provided, subject to the provisions of this Act along with rules from the medical scheme concerned, pay to some member or provider of service, any kind of bonus due to that member or supplier of service inside of 1 month after the day by which the claim in regard of such bonus was received via the medical scheme".
The problem appears whether this merely allows medical schemes to pay service providers directly or whether it in reality create a duty on medical schemes to make payments directly to providers, as has been argued by service providers.
The Supreme Court of Appeal, in Medscheme Holdings (Pty) Ltd and the other v Bhamjee [2005] ALL SA 16 (SCA), found that Mr Bhamjee, a medical practitioner, had no basis on which to insist that Medscheme (an authorized medical scheme) pay him straightaway.
The problem appears whether this merely allows medical schemes to pay service providers directly or whether it in reality create a duty on medical schemes to make payments directly to providers, as has been argued by service providers.
The Supreme Court of Appeal, in Medscheme Holdings (Pty) Ltd and the other v Bhamjee [2005] ALL SA 16 (SCA), found that Mr Bhamjee, a medical practitioner, had no basis on which to insist that Medscheme (an authorized medical scheme) pay him straightaway.
In this decision, the Court seemed to recognise that although section 59(2) produces a base upon which medical schemes may discharge responsibilities payable to customers by reimbursing service providers directly, the section does not force a medical scheme to do this where the provider had filed an account with the medical scheme.
This perspective was validated in the recently resolved and reportable matter of Tshwane Pharmacy (Pty) Ltd v GEMS which was observed by the North Gauteng High Court under case number 28532/11.
In this case the Applicant (a service provider) applied to Court on an urgent grounds for an order directing that the Respondent (a registered medical scheme) generate payment to them directly, but not to their members.
The Applicant contended that the key phrase in section 59(2) of the Act is "benefit due to the customer or service provider of the service" and that on a common-sense interpretation of the area it means that when a member has not paid the supplier of the service the medical scheme does not have discernment but is required to repay the provider.
The Court failed to concur with this argument, and held that section 59(2) has to be considered in context. Subsection (1) provides that a provider of a service that has rendered a service is required to supply the member interested in an account comprising prescribed information. Subsection (2) then provides that when this account happens to be rendered the medical scheme could pay to the member or even the provider of the service the bonus due to that member or provider of the service.
The Court also held that, in the context of the section, the bonus outstanding must refer to the total amount outstanding by the member to the provider for the service supplied. The Court mentioned that it is irrelevant that the bonus results in being owing to the customer thanks to the understanding concerning the customer and the medical scheme and, to the provider, by virtue of the contract between the member and the supplier. The subsection does not build an obligation on the medical scheme to repay the service provider.
Additionally, the Court held that the subsection undoubtedly provides that payments is susceptible to the rules of the medical scheme, and in the case of the Respondent it's rules claimed unambiguously how the Respondent has the right to pay back either the customer or the supplier of the service.
As a result,
This perspective was validated in the recently resolved and reportable matter of Tshwane Pharmacy (Pty) Ltd v GEMS which was observed by the North Gauteng High Court under case number 28532/11.
In this case the Applicant (a service provider) applied to Court on an urgent grounds for an order directing that the Respondent (a registered medical scheme) generate payment to them directly, but not to their members.
The Applicant contended that the key phrase in section 59(2) of the Act is "benefit due to the customer or service provider of the service" and that on a common-sense interpretation of the area it means that when a member has not paid the supplier of the service the medical scheme does not have discernment but is required to repay the provider.
The Court failed to concur with this argument, and held that section 59(2) has to be considered in context. Subsection (1) provides that a provider of a service that has rendered a service is required to supply the member interested in an account comprising prescribed information. Subsection (2) then provides that when this account happens to be rendered the medical scheme could pay to the member or even the provider of the service the bonus due to that member or provider of the service.
The Court also held that, in the context of the section, the bonus outstanding must refer to the total amount outstanding by the member to the provider for the service supplied. The Court mentioned that it is irrelevant that the bonus results in being owing to the customer thanks to the understanding concerning the customer and the medical scheme and, to the provider, by virtue of the contract between the member and the supplier. The subsection does not build an obligation on the medical scheme to repay the service provider.
Additionally, the Court held that the subsection undoubtedly provides that payments is susceptible to the rules of the medical scheme, and in the case of the Respondent it's rules claimed unambiguously how the Respondent has the right to pay back either the customer or the supplier of the service.
As a result,
The Court failed to concur with this argument, and held that section 59(2) has to be considered in context. Subsection (1) provides that a provider of a service that has rendered a service is required to supply the member interested in an account comprising prescribed information. Subsection (2) then provides that when this account happens to be rendered the medical scheme could pay to the member or even the provider of the service the bonus due to that member or provider of the service.
The Court also held that, in the context of the section, the bonus outstanding must refer to the total amount outstanding by the member to the provider for the service supplied. The Court mentioned that it is irrelevant that the bonus results in being owing to the customer thanks to the understanding concerning the customer and the medical scheme and, to the provider, by virtue of the contract between the member and the supplier. The subsection does not build an obligation on the medical scheme to repay the service provider.
Additionally, the Court held that the subsection undoubtedly provides that payments is susceptible to the rules of the medical scheme, and in the case of the Respondent it's rules claimed unambiguously how the Respondent has the right to pay back either the customer or the supplier of the service.
As a result, the Court discovered no cause for a responsibility on the Respondent to pay the Applicant directly and laid off the application with fees.
From the above it is obvious that to assure payment for services rendered by companies should either claim payment directly from their patients, or ensure that they have contractual arrangements with all the medical schemes. For the time being, our Courts seem to be hesitant to demand a statutory obligation on medical schemes to make repayment straight to companies without this kind of contractual agreement.
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The Court also held that, in the context of the section, the bonus outstanding must refer to the total amount outstanding by the member to the provider for the service supplied. The Court mentioned that it is irrelevant that the bonus results in being owing to the customer thanks to the understanding concerning the customer and the medical scheme and, to the provider, by virtue of the contract between the member and the supplier. The subsection does not build an obligation on the medical scheme to repay the service provider.
Additionally, the Court held that the subsection undoubtedly provides that payments is susceptible to the rules of the medical scheme, and in the case of the Respondent it's rules claimed unambiguously how the Respondent has the right to pay back either the customer or the supplier of the service.
As a result, the Court discovered no cause for a responsibility on the Respondent to pay the Applicant directly and laid off the application with fees.
From the above it is obvious that to assure payment for services rendered by companies should either claim payment directly from their patients, or ensure that they have contractual arrangements with all the medical schemes. For the time being, our Courts seem to be hesitant to demand a statutory obligation on medical schemes to make repayment straight to companies without this kind of contractual agreement.
About the Author:
Learn about medical law and the medical schemes act from the best in the industry. Dirk Markhen is a specialist medical attorney practicing in the law of medicine.