National Assembly: Parmed Medical Aid Scheme Act Voluntary Membership Bill

• A private member's bill proposes to change Parmed Medical Aid Scheme membership from compulsory to voluntary for public office bearers.
• ActionSA MP Dr. Kgosi Letlape introduced the bill, arguing for members' right to choose their medical aid or use public healthcare.
• While Parmed offers comprehensive benefits, critics argue its 'one-size-fits-all' approach is inflexible and its costs are escalating.
• Public submissions largely support the bill, with nine out of ten advocating for voluntary membership.
• If enacted, the amendment would allow officials to terminate Parmed membership with one month's notice.

Dr. Letlape argues that this change is crucial to grant these individuals the fundamental right to select a medical aid scheme that best suits their personal circumstances, or alternatively, to opt for public healthcare services.

The South African National Assembly is currently reviewing a significant legislative proposal aimed at altering the framework governing medical aid for public office bearers. This amendment seeks to transform membership in the Parmed Medical Aid Scheme from its current compulsory status to a voluntary one. The initiative comes in the form of a private member’s bill, spearheaded by ActionSA MP Dr. Kgosi Letlape.

Should this Dr Kgosi Letlape Parmed bill be enacted, it would empower a broad spectrum of elected officials and judicial figures to choose their healthcare coverage. This includes members of parliament, those serving in the National Council of Provinces, members of provincial legislatures, and judges. Dr. Letlape argues that this change is crucial to grant these individuals the fundamental right to select a medical aid scheme that best suits their personal circumstances, or alternatively, to opt for public healthcare services.

Currently, the Parliamentary and Provincial Medical Aid Scheme Act of 1975 mandates that these public office bearers are compelled to be members of Parmed. A 2017 comparative analysis conducted by Medscheme, the administrator of Parmed, highlighted the scheme's considerable advantages. The report noted Parmed's very comprehensive benefits, competitive contributions, and the absence of restrictions concerning hospital, pharmacy, or specialist networks. Furthermore, it praised the scheme's extensive and flexible medicine formularies, its coverage for over 100 chronic conditions, and the lack of co-payments or deductibles on procedures, asserting that these features contribute to "some of the richest benefits available in the medical schemes market."

Despite these reported strengths, Dr. Letlape contends that Parmed's "one-size-fits-all" methodology fails to adequately address the diverse needs of its members, who often have varying family sizes and distinct healthcare requirements. He points to a lack of flexibility, which he believes underscores the argument that a single, compulsory scheme cannot effectively serve all members, yet they are currently bound by compulsory contributions. Concerns about the escalating costs of Parmed, leading to substantial deductions from members' salaries, are also a significant factor in his push for a compulsory Parmed membership amendment. Dr. Letlape further views the scheme's exclusivity to public office bearers, to the exclusion of the general public they serve, as unconscionable, suggesting that officials should have the freedom to join any scheme, including the GEMS medical aid for MPs.

During a recent briefing to the Portfolio Committee on Health, Dr. Letlape disclosed that ten public submissions were received regarding the proposed South Africa medical aid legislation change. A notable nine of these submissions expressed support for the bill, indicating a strong desire for the Parmed Medical Aid Scheme Act voluntary membership. Only one submission opposed the proposed amendment, advocating instead for the complete abolition of Parmed. This dissenting view proposed its replacement with a compulsory, solidarity-based, tax-funded scheme, which would be integrated and aligned with the National Health Insurance Act of 2023 and Section 27 of the Constitution.

Dr. Letlape observed that none of the ten submissions raised any concerns regarding affordability, and he concluded that there is no discernible support for the continuation of Parmed in its existing form. The legislative process will now move to invite further comments and objections from a range of stakeholders. These include the Department of Health, the Council for Medical Schemes (CMS), parliament itself, provincial legislatures, the judiciary, and various political parties. Should the amendment ultimately pass and be enacted, it would allow officials to terminate their Parmed membership by providing at least one calendar month's notice to the scheme.

Lawyers advising public office bearers or medical aid schemes should track this proposed amendment to the Parliamentary and Provincial Medical Aid Scheme Act, 1975, as it would shift Parmed membership from compulsory to voluntary, impacting benefit choices and compliance obligations for a significant group of officials.

Source: Original reporting on South African legislative developments.