THE operating environment for the medical aid industry has been characterised by escalating costs of healthcare services, which are in turn affecting the accessibility and long long-term viability of medical insurance.
guest column:Johannes Marisa
The triadic nature of the industry, that is, the medical aid society, service provider and client, means that at any point, two members of the triad are in contact, without the presence of the other member.
This set-up requires a high level trust. While medical aid societies have been regularly reviewing products, benefits and contributions in a bid to balance affordability and accessibility, the service provider has become disgruntled by failure of the medical aid to pay for services rendered. This has been worsened by the volatile economy that has seen inflation escalating in the last few years. The medical insurance market has remained stagnant at about 1,5 million people, if not shrinking. The cake has definitely shrunken with a good number of organisations failing to remit funds to their respective medical aid societies.
What has ensued is a battle for survival. In austere conditions, good faith and trust evaporate, leading to a breakdown of the triadic set-up in the healthcare industry.
The shrinking formal sector coupled with poor organisation of the informal sector on top of medical aid societies’ reluctance to sign up new individuals because of perceived adverse selection risk of some age groups, has thus kept the figure of the insured at about 9% of the population, leaving about 91%
There has been a lot of finger-pointing, with medical aid societies raising their grievances against service providers. The service providers have often blamed the medical aid societies of failing to honour their side of the deal.
However, the two remain key in the provision of healthcare in Zimbabwe. What should be embraced by these two is the concept of shared value. Originally an academic concept, the idea was co-created by Harvard Business School professors, Michael Porter and Mark Kramer and introduced in 2011 in the Harvard Business Review article Creating Shared Value.
The establishment of shared value came after the global financial crisis when capitalism and the reputation of business were under siege. Shared value made the radical proposition that corporate success and improved social and environmental conditions are inherently linked and when achieved together, they could dramatically enhance our future prosperity.
It is thus imperative that medical aid societies and service providers need to collaborate and stop being adversaries. Both have valid complaints against each other, with the funder complaining of unwarranted over-servicing by service providers and high claims. The funder and the service provider must learn to work together again.
This transparency allows for fair claims by providers and timeous payments by funders, ultimately reducing the cost for the customers and thus increasing access to healthcare. The silos within the industry and the asymmetry of information between funders and providers has created a ticking time bomb where everyone is a loser at the end.
The shared value concept makes the funder, the service provider as well as the client exist in balance, where everyone is working for growth.
Bilateral communication is important between the medical aid and the service provider and any form of perceived aggressive behaviour by one part will not be tolerated. Bullies are unwelcome. The protagonists should bear in mind that a vibrant health system requires the co-operation of all those that are directly involved in healthcare discharge. The following can be of importance if solutions are to be found in the near future:
All stakeholders must carry their own water to understand the value of every drop. Members should pay their subscriptions religiously so that the fund can pay service providers satisfactorily.
Service providers should charge economic tariffs without bleeding the healthcare funds as they should be involved one way or the other in safeguarding the fund. The aim of the fund should be to co-ordinate without imposing anything on any of the players. Its governance structures must be inclusive of service providers, patients, community members and should draw legal, financial and actuarial professionals to complement the structure.
Information technology is key in bringing the much-needed transparency in managing the financial resources by a fund that is grounded on integrity, knowledge, accountability, continuous improvement and ethical standards.
Many service providers have talked about the capitation model especially considering the instability in the financial sector. By combining capitation with provider-sponsored health plans, where practitioners participate in determining what to charge for what package of services, one gets a hybrid product that already has a buy-in from key stakeholders.
Access Health Fund, fronted by medical doctor Enock Tatira, has lately been on the drive for capitation. Practitioners have welcomed the new model, taking into cognisance the fragility of the health sector at the moment. Patients are seen without paying co-payments as practitioners are already covered.
Capitation comes in many forms. The health fund can come in and offer practitioners a fixed monthly, quarterly or even a yearly lump sum payment for looking after its members in that community.
Medical aid societies like PSMAS, First Mutual, Cimas and many others have the capacity for such. The fund does its budgets and offer a comprehensive package or prior-agreed packages to members of the community.
Capitation model has thus been credited for avoidance of over-servicing of patients. Only necessary tests and investigations are ordered in order to preserve the fund.
Both medical aid societies and service providers need to sing from the same hymn book. Together, we will succeed as a nation.