KeyHealth PMB Ultomiris Appeal Ruling: Scheme Must Cover Full Cost

• A 15-year-old with a rare blood disorder won an appeal for full coverage of a R7.3 million life-saving drug from KeyHealth.
• KeyHealth initially refused, then offered partial, conditional funding for the R7.3 million first-year treatment.
• The Council for Medical Schemes Appeals Committee ruled that an explanatory note does not override the Medical Schemes Act's requirement for full PMB coverage.
• This decision clarifies that medical schemes must cover the full cost of Prescribed Minimum Benefits, regardless of expense.
• KeyHealth is appealing the ruling, while MediCheck seeks an urgent court order for the teenager's treatment.

The committee unequivocally declared that the explanatory note cited by the registrar did not supersede the primary regulation requiring medical schemes to cover the full cost of Prescribed Minimum Benefits.

A 15-year-old in South Africa, suffering from a rare blood disorder known as paroxysmal nocturnal haemoglobinuria, faced a life-threatening situation requiring urgent and costly medical intervention. The teenager, whose identity remains protected, was experiencing increasingly frequent emergency blood transfusions, escalating from every 143 days to every 13 days. These transfusions were no longer effective, and without a new drug, Ultomiris, recently registered in South Africa, the prognosis was fatal.

The teenager's medical scheme, KeyHealth, initially declined to cover the treatment, which carries an estimated first-year cost of R7.3 million, followed by R6.1 million annually for life. Following the involvement of the advocacy organization MediCheck, led by CEO Mark Hyman, KeyHealth eventually offered a conditional partial payment in June. This offer stipulated that the family would need to upgrade from their Equilibrium option to the highest-tier Platinum plan, settle any existing savings deficit, commit to remaining with the scheme through 2026 and 2027, accept potential clawbacks, and agree to a funding review if the patient required hospital admission.

The core of the dispute centered on the Prescribed Minimum Benefits (PMBs) mandated by the Medical Schemes Act and its accompanying regulations. This legislation requires medical schemes to cover the full cost of treatment for 26 chronic conditions and 271 diseases, irrespective of the expense. Mark Hyman of MediCheck emphasized that PMBs are uniformly covered across all scheme options, from the most affordable to the most expensive, a point he urges members to verify if their scheme suggests otherwise.

Despite these clear legislative requirements for Medical Schemes Act PMB coverage, the Council for Medical Schemes (CMS) registrar initially ruled against the teenager. This decision was based on an explanatory note found in an annexure to the regulations, which the registrar interpreted as limiting PMB care to the level provided in government hospitals. This interpretation effectively allowed KeyHealth to avoid full coverage of the high-cost treatment.

The CMS Appeals Committee, however, delivered a pivotal ruling on October 29, overturning the registrar's earlier decision. The committee unequivocally declared that the explanatory note cited by the registrar did not supersede the primary regulation requiring medical schemes to cover the full cost of Prescribed Minimum Benefits. This ruling reinforces the principle that the Medical Schemes Act's provisions for PMB coverage must be honored in their entirety, regardless of the cost of the necessary treatment.

Mark Hyman hailed this decision as a significant triumph for individuals relying on PMB conditions, predicting its widespread impact across all medical schemes. He pointed out that KeyHealth's audited 2025 accounts show a solvency ratio of 41.6%, exceeding the required 25%, and a surplus of R249.1 million. Hyman argued that, as non-profit entities by law, medical aids do not require such substantial surpluses, especially when members are denied essential care.

The Council for Medical Schemes appeal decision provides crucial clarity regarding the interpretation of the Medical Schemes Act, particularly concerning the obligation to cover prescribed minimum benefits full cost. This ruling has broad implications for how medical schemes manage and fund high-cost treatments for PMB conditions, setting a precedent that explanatory notes cannot diminish statutory requirements.

Despite the Appeals Committee's clear stance, KeyHealth has indicated its intention to appeal the decision to the appeal board, continuing the South Africa medical aid dispute. In response, MediCheck medical aid advocacy plans to seek an urgent interim court order to ensure the teenager receives the life-saving treatment while the appeal process unfolds. This ongoing legal battle highlights the tension between the rising costs of advanced medical treatments and the statutory obligations of medical schemes to provide comprehensive care for prescribed minimum benefits.

This ruling clarifies that explanatory notes do not override the Medical Schemes Act's requirement for full coverage of Prescribed Minimum Benefits (PMBs), regardless of cost. Lawyers advising clients on medical aid disputes, particularly those involving high-cost PMB treatments, should cite this precedent. Compliance officers at medical schemes must review their PMB coverage policies to ensure full compliance and avoid similar challenges.

Source: Original reporting via legal news sources