RAF says it is not in contempt of high court judgment

The Road Accident Fund (RAF) claims it is not in contempt of a high court judgment on an application by Discovery Health because it has amended its directive on payments to medical aid scheme claimants.

RAF CEO Collins Letsoalo at the weekend also accused Discovery Health CEO Ryan Noach of issuing a misleading statement in response to last week’s Constitutional Court ruling.

ALSO READ: Dr Ryan Noach stepping down as Discovery Health CEO

RAF directive declared unlawful

The RAF directive, issued on 12 August 2022 by the RAF’s acting chief claims officer, instructed RAF employees not to pay claimants if their medical aid scheme had already paid for their medical expenses arising from a road accident.

This directive was declared unlawful by the High Court in Pretoria on 27 October 2022 following an urgent application launched by Discovery Health.

Both the high court and Supreme Court of Appeal (SCA) subsequently dismissed the RAF’s leave to appeal the ruling.

Last week, the Constitutional Court dismissed an application by the RAF for leave to appeal the judgment, for jurisdictional reasons.

ALSO READ: Embattled RAF heads to ConCourt after SCA dismisses its Discovery appeal

Amended position

Letsoalo stressed at the weekend that the decision of the High Court in Pretoria set aside an internal directive that dealt broadly with past medical expenses paid by medical schemes issued internally to RAF employees on 12 August 2022.

Letsoalo said the RAF has “for more than a year now amended that position, in the directive, to assessing each claim on its merits and reject the payment of prescribed minimum benefits (PMBs) and emergency medical conditions (EMCs)”.

He claimed PMBs and EMCs “are obligations of Medical Schemes in terms of the Medical Schemes Act (MSA) and Regulations, specifically Section 29(1)(o) and Regulation 7 and 8 of the MSA Regulations”.

“Put differently, RAF will pay any other medical costs by claimants that are medical scheme members,” said Letsoalo.

“One will note that this was a departure from the 12 August 2022 directive, which was set aside by the North Gauteng High Court, a decision upheld by the Supreme Court of Appeal.

“It is, therefore, incorrect to say the RAF is in contempt of any court judgment,” he said.

Attempts to obtain comment from Discovery Health on the latest claims made by the RAF were unsuccessful.

However, Discovery Health CEO Dr Ryan Noach said last week, in response to the RAF’s initial reaction to the Constitutional Court ruling, that it is unaware of any further directive issued by the RAF.

“The only directive we know about is the internal memo sent by the RAF on 12 August 2022,” he said.

Noach said then that PMBs are defined by the Medical Schemes Act and “relevant only to the conduct of medical schemes in terms of how specific conditions are funded”.

“PMBs have no legal bearing whatsoever on the RAF,” he said.

‘No implications’

Letsoalo told Moneyweb in his initial response to the Constitutional Court ruling last week that there are “no implications on the RAF”.

“The [Constitutional] court order did not deal with any merits. It raised issues of a lack of jurisdiction.

“The RAF issued an internal directive on 12 April 2023 stating its legal position about prescribed minimum benefits and emergency medical conditions and how those claims should be processed.

“That directive has neither been challenged nor sat aside and thus still applies,” he said.

Misleading statement

Commenting on his accusation that Noach issued a misleading media statement in response to last week’s Constitution Court ruling, Letsoalo said Noach stated that “the Constitutional Court, the apex court in our land, has upheld the decision of the high court”.

Letsoalo highlighted that the Constitutional Court had ordered as follows: “The Constitutional Court has considered the application for leave to appeal and has concluded that it does not engage the jurisdiction of the court. Consequently, leave to appeal must be refused.”

Letsoalo said it is apparent from the Constitutional Court order that nowhere did it uphold any decision by the high court or SCA.

“The Constitutional Court simply raised an issue of jurisdiction and did not uphold any decision,” he said.

Comment from Discovery Health on the RAF claims about its allegedly misleading statement will be added once received.

‘Medical schemes are social benefit organisations’

Letsoalo added that the North Gauteng High Court on 22 September 2023 furthermore unequivocally stated that: “… neither Discovery nor the medical schemes it represents have a right to directly claim from the Fund, the right to compensation being that of the member claimants as the road accident victims (the medical scheme).”

He said this legal position has not changed “and confirms RAF’s position”.

“Medical schemes are not insurers or insurance but social benefit organisations governed by the MSA (Medical Scheme Act) and clearly differentiated through the demarcation regulations issued through a government gazette on 23 December 2016 by the National Treasury.

“The demarcation framework buttressed the … principles of medical schemes, open enrolment and community rating,” he said.

Letsoalo said National Treasury further clarifies these in the explanatory memorandum when it states:

“The requirement to include prescribed minimum benefits (PMBs) in medical schemes extends the social security net to vulnerable groups, ensuring access to healthcare and providing protection from catastrophic out-of-pocket expenditure.

“By compelling the funding of the PMB package from the common risk pool of a medical scheme, the principle of community rating is achieved across all medical schemes so that everyone is charged the same standard rate for the common PMB package, regardless of the option or scheme they choose to join.”

RAF: ‘Refuse this bullying and abuse’

Letsoalo said the RAF calls on medical scheme members and trustees “to refuse this bullying and abuse from administrators of medical schemes”.

“They are owners of medical schemes and should reject any attempts to be put under duress and undue influence by being threatened with termination of membership when they refuse to claim from the RAF social benefit scheme that has nothing to do with any loss or damage that they have suffered.

“Medical schemes and their administrators are not claimants in terms of the RAF Act, and they must continue to pay for PMBs and EMCs without any deductibles or co-payments as obligated by the MSA and MSA regulations.”

This article is republished from Moneyweb under a Creative Commons licence. Read the original article.

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