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Presentation on Tariff Guidelines. 22 August 2012 Parliamentary Portfolio Committee on Health. Who is SAMA?. SAMA is a Doctor’s organisation Originally founded in 1927 Transformed in 1998 by amalgamation of all major doctor groupings Section 21 company and a registered Trade Union

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Presentation on tariff guidelines

Presentation on Tariff Guidelines

22 August 2012

Parliamentary Portfolio Committee on Health


Who is sama
Who is SAMA?

  • SAMA is a Doctor’s organisation

    • Originally founded in 1927

    • Transformed in 1998 by amalgamation of all major doctor groupings

  • Section 21 company and a registered Trade Union

    • Not for profit organisation

  • Represents >17 000 Doctors in public service and private practice



Sama s coding history
SAMA’s Coding history

  • First coding booklet published in 1944

    • Annually updated ever since –> called the Doctors Billing Manual (DBM)

  • >60 years of intellectual property in DBM

  • SAMA is the steward of doctor’s codes

    • Custodian for future generations of Doctors


The sama dbm
The SAMA DBM

  • The DBM represents the scope of practice of the medical profession

  • Current format first created in 1975

  • Why does SAMA do coding?

    • SAMA is a neutral referee

    • Inter disciplinary relativity is maintained

  • The DBM is the recognised industry standard

    • Today used by HPCSA & Discovery, GEMS and BHF, representing over 80% of medical schemes


Tariffs past and present
Tariffs past and present

  • Until 1978 SAMA Rate and RAMS Scale of Benefits were equal

    • Scale of Benefits then became lower than SAMA rate

    • RAMS replaced by the BHF

    • Subsequently SAMA and BHF negotiated tariffs annually

  • 2003 = last year SAMA calculated a rate on behalf of doctors

  • 2004 – Competitions Commission ruled the above activity “anti-competitive”

  • NRPL (National Reference Price List)

    • 2004 – 2005, CMS produced guideline NRPL

    • Codes based on SAMA DBM

  • NHRPL (National Health Reference Price List)

    • 2006 NHRPL produced by NDoH

    • Codes based on SAMA DBM


Tariffs past and present1
Tariffs past and present

  • HPCSA

    • Produced an “Ethical Tariff” in 2006

    • Used NHRPL (multiplied by 3)

    • 2008 the Ethical Tariff was scrapped

  • RPL

    • basis of the RPL was challenged

    • RPL declared invalid by High Court of South Africa


Sama hpcsa guideline tariff process
SAMA/HPCSA Guideline Tariff process

  • 15 July 2011

    • HPCSA Ombudsman invited SAMA to discuss tariff guidelines

  • 22 July 2011

    • SAMA submits written Tariff Guideline Proposal to HPCSA

  • 17 January 2012

    • SAMA meets with acting HPCSA registrar and enquires when guideline will be published – stresses importance of using updated DBM for process

  • 11 June 2012

    • SAMA meeting with the new Registrar – above again emphasized


Sama hpcsa 2012 guideline discussion background
SAMA/HPCSA 2012 Guideline Discussion Background

  • SAMA offered 2012 DBM to HPCSA

    • Contains 150 altered codes since 2010

    • Contains 445 altered codes since 2009

    • Contains 1202 altered codes since 2005

  • SAMA offered services of coding department

  • SAMA delayed publishing of 2012 DBM

  • SAMA requested a single RCF across all specialities

    • RVU gives interdisciplinary relativity



Healthcare inflation
Healthcare Inflation

  • 1990

    - Average CPI Inflation = 14.2%

    - Average Medical Scheme inflation =27.3%

    - Average contribution PBP/m = R74.45

  • 2000

    -Average CPI Inflation =5.4%

    - Average Medical Scheme inflation =7.5%

    - Average contribution PBP/m = R343.45

  • 2010

    -Average CPI Inflation =4.3%

    - Average Medical Scheme inflation =11.3%

    - Average contribution PBP/m =R975.82


2010

R975.82 PBPm

2010

R168.08 PBPm

1981

R11.73 PBPm


Scheme expenditure per beneficiary per month
Scheme Expenditure per beneficiary per month

2010 Contributions

R975.82 PBpm


Healthcare costs
Healthcare Costs?

  • Administrator cost

  • Managed Care cost

  • Broker fees

  • Actual cost of healthcare


2010

R11,564,770,000


Non healthcare expenditure

NonHealthcare Expenditure:

Administration & Managed Healthcare


“Administrators and businesses associated with administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

Council for Medical Schemes

2009/2010 Annual report p214


75% administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

-42%

23%

7%

-40%


Non healthcare expenditure1

Non administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”Healthcare Expenditure:

Brokers


Medical scheme membership as of population
Medical Scheme Membership as % of Population administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”


Broker summary
Broker Summary administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

  • 2000 - 2010

    • 16% population growth

      • 19% MS membership growth

      • 9.4% MS membership growth excluding GEMS

    • 1 326 587 new MS members

      • 665 377 new MS members excluding GEMS

    • Cost of R8.85 Billion

      • R6 670.13 per new MS member

      • R13 298.50 per new MS member excluding GEMS


Conclusion
Conclusion administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

  • Brokers are being paid large sums of money but have effectively attracted few new members

  • MHC has not succeeded bringing down healthcare costs only GP visits

  • Administrators are charging medical schemes significantly

  • Hospitals are a significant cost


Determining a doctor’s worth? administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”


How to determine an rcf
How to determine an RCF? administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”


Annualised 2012 overheads
Annualised 2012 Overheads administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”


SAMA 2012 RCF = R28.93 administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

*Excludes risk compensation factor


2012 hpcsa tariff guideline
2012 HPCSA Tariff Guideline administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”


  • 62% increase in doctors’ input costs since 2003 administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

  • Malpractice insurance costs are increasing exponentially

  • Massive administrative burden

    • 98 Medical schemes with on average 5 options each

    • 490 different tariff guides

    • 490 different protocols and formularies

    • Exhaustive authorisation and motivation procedures

    • 5 -10% of income to claims bureaus


Conclusion administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

& Way Forward?


Conclusion1
Conclusion administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

  • Benchmark tariff is essential

    • Provide much needed stability and framework

    • NHI process will require an appropriate tariff guideline


Suggested way forward
Suggested Way Forward administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

  • SAMA suggests a benchmark tariff

    • Must be based on actual practice cost studies

    • Must include Tiered Tariffs

  • SAMA 2012 DBM used as the standard

    • Tariff codes are the scope of practice of the medical profession

  • Access = affordable healthcare + available doctors


Suggested way forward1
Suggested Way Forward administrators often provide managed healthcare services. In many instances, these services are merely additional layers of administration costs with questionable benefits for the schemes themselves.”

  • SAMA willing to work with the HPCSA

    • Use the 2012 DBM as basis for tariff guideline

    • Must use actual cost studies on which to base tariffs

  • Competition Commission

    • Medical Industry must be exempted

    • Allow SAMA to suggest guideline to members

    • Allow doctors and funders to negotiate tariffs

  • Pricing Commission

    • The composition of Pricing Commission to be equitable


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