Laura du Preez | 06 September 2024
Laura du Preez has been writing about personal finance topics for more than 20 years, including eight years as personal finance editor for two leading media houses.
Many medical scheme members mistakenly believe obtaining pre-authorisation for a procedure or treatment means their claims will be paid in full.
Pre-authorisation should, however, alert you to potential scheme payment shortfalls and ways to avoid them, according to the Council for Medical Schemes.
However, it admitted it has found flaws in the process. The council recently commissioned a member survey that identified gaps in members’ understanding of pre-authorisation and particularly pre-authorisation letters sent by schemes.
Forty percent of members surveyed faced co-payments after obtaining pre-authorisation and of those, 30 percent did not understand why their claims were not paid in full, according to Corlia Koen, senior market analyst from Demacon Market Studies which conducted the survey for the council.
Medical schemes use pre-authorisation to manage costs and check that you have the required benefits before you have an expensive procedure or treatment like oncology, Hannelie Cornelius, the manager for accreditation of administrators and managed care organisations at the Council for Medical Schemes, told a recent council webinar.
But, she said call centre staff at administrators and managed care organisations were not always adequately trained on pre-authorisation and did not ask members the right questions or advise appropriately about authorisation requirements.
Pre-authorisation confirmation letters are often not detailed enough and do not explicitly state the exclusions or limitations on cover, leaving members unaware of potential co-payments or short payments, Cornelius said.
Administrators and managed care organisations should be able to advise you on how best to utilise your benefits, minimising co-payments and short payments, she said.
For example, if you request authorisation for a procedure at a hospital that is not one of your scheme’s preferred providers or designated service providers (DSP), the call centre agent should warn that if you go ahead there could be a co-payment, she says.
Cornelius said members are not always appropriately advised of their prescribed minimum benefit (PMB) entitlements and what is required to access full cover for these conditions.
Administrators often pay PMB claims at scheme rates instead of in full as required by law when there is no DSP. Some providers also do not charge at agreed rates. This causes incorrect short payments, she said.
Mumsy Mashilo, the senior manager responsible for complaints adjudication at the Council for Medical Schemes, said complaints from members about unpaid pre-authorised treatment reveal that schemes often wrongly fail to pay for non-PMB conditions which are complications of a PMB condition.
She said requests for pre-authorisation for portable oxygen concentrators for PMB conditions are frequently denied as schemes fail to appreciate that members or their dependants are often working, running a business or attending school and cannot be home-bound.
The Council for Medical Schemes is also concerned that schemes are appointing hospitals as DSPs but have no DSP specialists who operate at those hospitals.
Members are given pre-authorisation for a procedure at the DSP hospital, but face shortfalls in cover as the only specialists who operate at those hospitals are not DSPs.
Koen said many members are unaware that anaesthetists and surgeons can charge more than scheme rates leading to co-payments and they are often not advised of this during pre-authorisation.
Mashilo said schemes that have not appointed DSPs cannot use monetary limits to contain PMB claims. She said some schemes do not have DSPs for prosthetic limbs and limit the benefits for these to R10 000 to R20 000 when the actual cost is R80 000 to R90 000. If a scheme does not have a DSP, it needs to fund prosthetic limbs in full as per the PMB regulations, she said.
More than 100 complaints about denied pre-authorisation over the past two years arose because members did not understand the benefits their schemes provide and that schemes have treatment protocols, Mashilo said.
Typically members have not seen these protocols and are unaware that they can request them to discuss it with their doctor before a procedure or treatment, she said.
Mashilo said another concerning trend is that schemes refuse to authorise alternative treatments when the scheme’s treatment protocol has failed or resulted in adverse effects. Members are not aware that the Medical Schemes Act obliges schemes to consider and fund alternative treatments in these cases.
Schemes should advise members who have obtained pre-authorisation when they are charged for services or items for which they should not be charged, Cornelius said.
The complaints department sees cases where healthcare providers charge for the same procedure under multiple codes – particularly for joint replacements and other orthopaedic surgeries, Mashilo said. In such cases, the council rules that neither the member nor the scheme are liable, she said
Reasons and codes on claims statements are often not explicit enough to give members clarity on why their pre-authorised treatment or procedure was not paid in full, Cornelius said.
Sometimes hospital claims are processed and paid by schemes before the hospital has updated the claim for changes in the level of your care or the length of your stay resulting in incorrect shortfalls, she said.
Members need to be actively involved in the pre-authorisation process and not delegate this to a doctor or another healthcare provider, as the provider may not pass on all the necessary information, Mashilo said.
She warned members to check that joint replacements are covered by their scheme, as some only cover this surgery as a PMB when the joint is broken in a fall or accident.
Members should not try to bypass their scheme’s DSP hospital by getting themselves admitted for an emergency treatment, as they will need to supply clinical evidence to support that it was an emergency, she warned.
Kelly du Plessis, founder of the non-profit organisation Rare Diseases South Africa, says pre-authorisation can keep scheme costs and ultimately your contributions too, as well as prevent you from having unnecessary medical procedures.
But it can also be extremely frustrating and challenging for people with serious, often-misunderstood, high-need health conditions, she said.
Treatments for rare diseases are often new and not well-known which can delay authorisation for months, while the patient’s condition deteriorates, she said.
Frustration also arises when approved care changes without members being informed or medication is approved but not the equipment required to administer it, she said.
Members often do not understand the scheme’s decision-making process and this creates mistrust.
Rare Diseases South Africa recently had a case of a toddler who was inexplicably denied a tonsillectomy despite his paediatrician explaining to the scheme that he had a PMB condition, 12 infections and three burst ear-drums within nine months, she said.
Appeal processes are often taxing and members in poor health, or struggling to support family members in poor health, give up because appealing is too emotionally taxing, Du Plessis said.
Dr Samantha Lyaloo, public health specialist at the Council for Medical Schemes, said there is scope for standardising and simplifying the pre-authorisation process and the information provided to members.
She said the council would get input from schemes and healthcare providers before considering issuing a guidance note on pre-authorisation to schemes.
