Ministerial statement on the situation and challenges between Health Insurers and Health Care Providers to map a way forward by Honourable Dr P. D Parirenyatwa.

Honourable Members of late you have heard largely through the media of challenges in the working relationship between Medical Aid Societies, as represented individually or by the Association of Health Care Funders of Zimbabwe (AHfoZ) and providers of health care services, particularly doctors as represented by the Zimbabwe Medical Aid Association (ZiMA).

The challenges as seen from provider’s perspective arise mainly from the following areas;

a) Disagreement over tariffs for various areas of service provision.

b)Payment by insurers to providers based on the insurer’s preferred tariff rate.

c) Delays in meeting payments for services rendered.

d) Referral of clients by insurers to preferred networks of providers and their own clinical and laboratory facilities

e) Conflict of interest by insurers by way of building, owning and running medical and dental clinics, hospitals, pharmacies, laboratories, radiology centres, rehabilitation units, optician clinics and other related health centres.

f) Disregard of Gazetted fees by insurers.

g) Unfair and crippling taxations and recovery practices by ZIMRA based on claims lodged by providers to insurers which claims are as yet unpaid and outstanding at time of taxation.

The challenges as seen from the insurers’ perspective arise from the following areas;

a) Disagreement over tariffs for various areas of service provision.

b) Charges by providers that are way beyond what the insurance can afford.

c) Demands by providers from patients for cash payments upfront while the clients are holding valid cards.

Discussions on the above mentioned issues some of which are now long standing in nature have been ongoing, albeit very slowly with a resultant near stalemate situation.

Last week ZiMA announced that they will with effect from July 1, 2016 stop accepting medical aid cards and charge cash to all patients seen by their constituency.

The trigger situation to this taxation and subsequent garnishing of providers accounts by ZIMRA for tax obligations which are deemed due based on the act of submission of a claim (invoice) by a provider to an insurer regardless of whether this has been paid or not.

Providers’ claims and have in some instances provided proof, that their claims usually remained unpaid for periods in excess of the statutory 60 days and sometimes for periods of up to six months or more.

Resultantly, providers felt they were being taxed for what they have not earned. Clarification with ZIMRA indicated that ZIMRA was acting within the law and the challenge was in fact between the provider and insurer and could therefore not absolve providers of the obligation for taxation, its timing the resultant default status and the garnishing of accounts thereof. To get out of this technicality and its consequences, the providers then decided on resorting to cash charges as announced until such a time that the insurers were ready to meet their obligations in a timely manner.

This situation would obviously disadvantage and stress the client who is rightfully insured, but has also exposed to out of pocket expenditures.

As regulator my Ministry called an urgent meeting to resolve the looming crisis and prevent further deterioration of the situation. An important stakeholder, The Minister of Finance and Economic Development, Hon (Patrick) Chinamasa, was present at the meeting.

The matters detailed as before were tabled and discussed. We all realised that some issues needed more time and further engagement, but we sought to immediately avert the potential crisis that would be ushered in by the cash-upfront position.

We therefore implored ZiMA to give engagement more time, the Minister of Finance would look into how the taxation timing issue could be handled and insurers were going to scrap the preferred provider approach, and for those in arrears, to work towards a framework to pay for claims within the statutory 60 days.

Both the providers as represented by ZiMA and the insurers as represented by AHf0z as well as individually for some sought reprieve to feed back their constituencies and revert to me with agreed positions on the proposed way forward.

The discussions, during which we were all agreed on the need to protect the interest of innocent client\patient, were candid and frank.

I am optimistic that ZiMA will give due consideration to our plea and I expect feedback on Monday June 27.

We also agreed and committed to meet regularly and address all the contentious areas methodically including looking at the regulatory provisions to address some grey areas not well articulated in the current statutory instrument.

To this end my Ministry has embarked on the process of crafting a bill for regulation of medical aid societies. The principles have been passed by cabinet and drafting has started. We will consult widely in the process..

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