IPEC not competent enough for medical aid business

Published: 08 September 2017

THE Insurance and Pensions Commission should not clamour to have medical aid societies under its regulatory purview, because it does not possess the competence and credibility to warranty such responsibility, the Ministry of Health and Child Care said.

This comes amid concern from IPEC and insurance experts that there was limited actual capacity in the ministry to regulate management funds from medical aid policy holders.

Unconfirmed reports say some medical aid societies were in the habit of diverting funds to non-core activities.

The medical insurance business, estimated to be valued $1,2 billion, through provisions of the Medical Services Act is regulated directly by the Ministry of Health and Child Care.

Health and Child Care Deputy Minister Adrian Musiiwa made the sensational remarks amid raging debate on whether medical insurers should remain under his ministry or be placed under IPEC.

Dr Musiiwa said in an interview that there will not be a change of the current set up where medical aid societies are regulated by his Ministry, a situation being buttressed.

"They are already failing to regulate funds under their ambit, so how could we then trust them with medical care."They are collecting insurance funds for vehicles and roads and people are dying in accidents but no one or very few are compensated so how can we trust them with medical funds for policyholders," he said."They have no capacity, just look at what has been happening. They have been collecting funds for 10-20 years and workers retire and they are told that funds were eroded by inflation.

"However, the insurers would have invested in a lot of buildings and other infrastructure, but many pensioners are getting absolutely nothing on retirement, there is no logic.

"The Ministry will have to regulate health insurance (medical aid society funds) because it is the correct body to do that, but as we speak, they should be ashamed to discuss this."

Deputy minister Musiiwa said IPEC only started making frantic efforts to bring medical insurers after it got wind of reports that the ministry was planning a Bill to regulate medical aid societies.

"We were only consulting health providers and funders, we are saying that let this one (medical aid societies) stand separately until we get to a point where we think maybe they are credible," he said. "They have no credibility, actually, from where we coming from a lot of people could lose their lives (due to their ineptitude)." He dismissed claims that medical aid societies were better off under IPEC due to limited actuarial expertise in the ministry.

"That does not work, that argument should have been coming from the medical aid societies (if need be)."
- zimpapers

Tags: IPEC,