We all dread hearing the words “doctor is contracted out of medical aid” when we step into a practitioner’s rooms. But the reality is that more medical professionals are contracting out of medical aid and charging cash rates these days. It also means that in many cases, although not always, the practitioner is charging fees above what your medical aid pays. This means having to fork out cash from your pocket and claiming back from your medical aid only to be reimbursed a portion of what you pay. You may find it frustrating and even upsetting but it is the reality of the private healthcare system in South Africa today. Many claim it is unethical for doctors to be charging higher rates. But is it so?

Contracted Out of Medical Aid

It is a practitioner’s right to choose to contract into or out of medical aid. Before you protest at your doctor’s rooms, you need to understand what this means. When a doctor or other health care professional is contracted into medical aid, he or she is simply saying that they will deal directly with your medical aid for payment of the services they render. At no time does this mean that the contract is between the doctor and the scheme. You, the patient, is the medical aid member. You have a contract with your medical aid – you pay your scheme your monthly premiums and your scheme covers your agreed upon medical bills.

Doctor’s who contract into medical aid are simply taking on the task of submitting the claim to your medical aid and awaiting payment directly from the scheme. Healthcare professionals in South Africa do not need to do this. Many do not opt to in fact. But some understand that it is best if they offer this service to their patients in order to maintain their practice. Doctor’s who are contracted out of medical aid simply opt not to deal with a scheme but directly with the patient with regards to payment of the services rendered. It is then the patient’s prerogative to claim back the money from the medical, or not.

Should medical aid members be charged cash?

Many healthcare professionals have become frustrated with dealing with all the different medical aids in the country. It costs them money in the way of administration and accounts staff, claims submission, processing errors, awaiting for the money to be paid to them and of course, bad debts (exhausted benefits that patients never pay). However, many healthcare professionals are still contracted into medical aid and bear the costs and difficulties of this process.

But what about the non-medical aid patients? They have been paying cash for the private healthcare services that they want because the do not have medical aid cover. It is undoubtedly a simpler process for the doctor to accept cash (or credit card) payments upfront and conclude the transaction then and there. Medical aid members are not as forthcoming with having to pay cash for services rendered. Many feel that since they are already forking out money for the medical aid premiums every month, paying cash to the doctor is unfair and unethical.

Ultimately it is your doctor’s right to choose how they administrate their private practice. Remember that private practice is essentially a private business. Private doctors and other healthcare professionals do not work for medical aids. So it is their right to decide whether they want the hassles of dealing with medical schemes. Should the patient not like their terms of payment, it is the patient’s right to seek private healthcare elsewhere or go to a government facility.

Private Rates vs Medical Aid Rates

Medical aids in South Africa pay according to the NHRPL rate – this stands for the National Health Reference Price List as determined by the Department of Health based on submissions by the Council of Medical Schemes and professional medical associations. Some doctors feel that these rates are too low and then charge their own private rates. It is essentially the same as a private business choosing what they wish to charge for a product or service. It is free trade, a cornerstone of democracy.

Professional medical organizations like SAMA (South African Medical Association) provides guidelines to doctors as to the rates that they should charge but it is still the doctor’s prerogative to choose the rate. The can charge more or less as the feel fit. Medical aids are not obliged to pay doctors the rate that they demand. But patients have to if they wish to contract the services of the doctor in question. This practice is not unethical but there are instances where some doctors may charge rates that seem unaffordable to some patients.

It boils down to the doctor’s customer (patient) base. A doctor who charges very high rates obviously has the patients who are prepared to pay him or her for their time and efforts. Otherwise the practitioner would not be able to sustain their practice. The patient who cannot afford these rates has the choice to seek medical care elsewhere. These are basic business practices based on supply and demand. Whether this is unethical or not can be debated but many patients and doctors will have opposing views on the right to charge higher than medical aid private rates.