The Independent Community Pharmacy Association (ICPA), a body which represents the interests of independent pharmacies in South Africa, is challenging Fedhealth to do away with its plans to introduce a closed Designated Service Providers.
The ICPA is taking Fedhealth to court following Fedhealth’s recent announcement that they are implementing a closed pharmacy network in 2017 on all but two of their benefit options.
This means that the medical aid scheme’s members must obtain their chronic medication from selected pharmacies, failing which they will have to pay a 40% penalty co-payment.
The ICPA has been trying for over five years to break what it regards as the power of medical aid schemes to set up closed network systems.
According to the ICPA, the current structure does not have the interests of the consumer at heart as it limits choices and excludes independent community pharmacies.
Its first challenge to the Council for Medical Schemes (CMS) was dismissed but the appeal board mandated the council to probe the closed network and the penalty co-payment mechanisms.
Earlier this year, the appeal board of the CMS instructed the regulator to investigate the closed network principle and penalty co-payment mechanism.
The CMS promised to publish a discussion policy document to resolve the issue.
However, CEO of ICPA, Mark Payne says: “The CMS has not demonstrated that they are investigating the matter, or published the proposed legislative changes they promised.”
The association intends to go to the high court to compel the CMS to make a ruling. The law allows designated service providers for medical schemes and co-payments, but says nothing about closed networks and penalty co-payments.
Payne said independent pharmacy groups were being marginalised because medical schemes implemented closed networks which restricted medical aid members to consulting with doctors and pharmacies selected by the scheme.
“A scheme like Fedhealth is saying that paying members cannot get medication from any pharmacy — they have to get it from corporate pharmacies or incur a 40% extra payment on chronic medication,” Payne told Business Day.
“We don’t object to designated service providers being appointed but we object to them being closed to specific service providers,” said Payne.
“With National Health Insurance (NHI) coming, we need to have as many healthcare professionals on board to drive this process — not marginalise about 2,000 pharmacists in favour of 266 corporate pharmacies,” continued Payne.
Payne said there were inconsistencies in Fedhealth’s proposal. Patients can receive chronic medication in the post and acute medication from their local pharmacies. “These systems don’t speak to each other.”
According to Business Day, Principal Officer of Fedhealth, Jeremy Yatt, said the scheme was acting “within legal bounds” and was not aware of any planned court action against it.