Govt to tighten control on medical aid administrator

GOVERNMENT has established a committee to oversee the administration of the Medical Aid Scheme for Public Service Employees (PSEMAS), which has been contracted out to a private company for the past six years.

The co-ordinating committee will be made up of staff from the Office of the Prime Minister as chairperson, the Finance Ministry and Health Ministry, recognised trade unions and co-opted members from medical boards. Cabinet resolved during its latest meeting that the committee should ensure that PSEMAS is “conducted prudently and on sound principles”.It will also oversee periodic reviews of benefit structure, amendments to medical aid rules and that formal channels of communication are established between PSEMAS, its members, administrators, consultants, service providers and other relevant stakeholders.The medical aid scheme is administered by the Finance Ministry, on whose budget annual provision is made for expenditure towards PSEMAS.For the past six years, administration and payment of medical claims were contracted out because the Ministry could not keep track with the increasing number of members and the subsequent increase in medical claims.Medical claims administration is not part of the core functions of the Ministry.In December 2003, Government awarded the tender to NamHealth Administrators, a company with strong political ties with the ruling Swapo party.NamHealth is owned by Prosperity Health, with Kobus Struwig as Managing Director, which offered shares to the Swapo Youth League and the National Union of Namibian Workers (NUNW).Earlier in 2003, the Tender Board cancelled bids for PSEMAS, after the NUNW publicly alleged “corruption in the Tender Board”.Insiders said at the time that Methealth, owned by insurance giants Sanlam, Metropolitan and black empowerment company Pamue, had been found to have made the best bid by a Government evaluation team and independent consultants.In September 2003, rivals NamHealth and Methealth formed a joint venture to jointly bid for the Government medical scheme, describing the move as a “smart partnership”.They won the N$45 million tender, and Methealth has been the main administrator of PSEMAS since then.Cabinet resolved during its latest meeting that the committee should ensure that PSEMAS is “conducted prudently and on sound principles”.It will also oversee periodic reviews of benefit structure, amendments to medical aid rules and that formal channels of communication are established between PSEMAS, its members, administrators, consultants, service providers and other relevant stakeholders.The medical aid scheme is administered by the Finance Ministry, on whose budget annual provision is made for expenditure towards PSEMAS.For the past six years, administration and payment of medical claims were contracted out because the Ministry could not keep track with the increasing number of members and the subsequent increase in medical claims.Medical claims administration is not part of the core functions of the Ministry.In December 2003, Government awarded the tender to NamHealth Administrators, a company with strong political ties with the ruling Swapo party.NamHealth is owned by Prosperity Health, with Kobus Struwig as Managing Director, which offered shares to the Swapo Youth League and the National Union of Namibian Workers (NUNW).Earlier in 2003, the Tender Board cancelled bids for PSEMAS, after the NUNW publicly alleged “corruption in the Tender Board”.Insiders said at the time that Methealth, owned by insurance giants Sanlam, Metropolitan and black empowerment company Pamue, had been found to have made the best bid by a Government evaluation team and independent consultants.In September 2003, rivals NamHealth and Methealth formed a joint venture to jointly bid for the Government medical scheme, describing the move as a “smart partnership”.They won the N$45 million tender, and Methealth has been the main administrator of PSEMAS since then.