No licence for indebted PSMAS | The Herald

via No licence for indebted PSMAS | The Herald January 22, 2014 by Paidamoyo Chipunza

The entire civil and uniformed services, and pensioners of these services, may go without medical aid as the Government has yet to renew the operating licence for Premier Service Medical Aid Society since the society had debts totalling US$38 million at the end of last year, including what it had owed doctors, dentists, hospitals and other service providers for more than two months.

Most PSMAS members work for the State, either directly through the civil and uniformed services, or in parastatals, or are pensioners of the State.

But the 600 000 members include many thousands of others. Part of this debt accrued after the society failed to pay the providers their dues within the 60-day period stipulated by regulations governing operations of medical aid societies.  The society says it is solvent, since it is owed US$44 million by members.

“PSMAS has been failing to pay up service providers on time citing low remittances from members but we heard that they received a substantial amount from Government in remittances for civil servants and we do not understand why they haven’t paid their dues,” said the source.

PSMAS group legal and corporate secretary Mr Cosmas Mukwezha said he was not aware that the licence would not be renewed. PSMAS was awaiting a response from the Government after submitting the required paperwork last week.

He said while they owed service providers, they were also owed about US$44 million by their members mostly from Government parastatals and other private companies. PSMAS members on Government schemes pay between US$7.50 and US$33 per person depending on the plan subscribed to.

The lowest subscription for members on private schemes is US$18 per person for the lowest plan but members could pay up to US$90 per person for top plans.

“We are owed more than we owe the providers making it difficult for us to settle claims on time,” Mr Mukwezha said.
He said Government asked them to submit particular documents like the society’s constitution, audited financial accounts and membership rules, which they did.

“If they need further information, we are sure they will communicate with us,” he said.
Sources said PSMAS last submitted its audited financial accounts to the ministry of Health and Child Care in 2009.

Recently the society made headlines after it emerged that its chief executive Mr Cuthbert Dube was allegedly earning a monthly salary of US$250 000, while his managing director, Mr Farai Muchena takes home US$190 000.

Government has denied Harare Municipality Medical Aid Society a licence to operate as a medical aid after it failed to pay its dues amounting to US$2 million.

HMMAS chief executive Mr Everisto Rukasha said they were working to meet a two-week deadline given by Government to clear the debt.
“Government gave us a two-week deadline on January 8 and we are making all efforts to prove to them that we have made meaningful progress in terms of clearing the debt,” he said.

Mr Rukasha attributed his society’s failure to pay up service providers on time to minimal remittances from its parent company- Harare City Council.

“We are also owed about US$6 million by the parent company and that impact negatively on our reimbursements to service providers,” he said.

Shelter and Kwekwe municipality medical aid societies are yet to apply for renewal of operating licences. Contacted for comment, Health and Child Care Deputy Minister Dr Paul Chimedza said Government was working with all societies to ensure that they abide by set regulations.

“We are working with them. There are a few issues that as a regulator, we want to make sure are followed whenever a licence is renewed,” Dr Chimedza said.

Government sources report that 25 societies have so far been renewed to operate in 2014. Government is pushing for all health funders to settle claims within the stipulated time frames so that no service provider denies treatment to a patient with a valid medical aid card.