NAMAF raises FIM Bill concerns

…as Bill ignores clinical governance, overrides MAF Act

By Hilary Mare

THE Namibian Association of Medical Aid Funds (NAMAF) has registered concerns over the anticipated Financial Institutions Markets Bill (FIM Bill) expressing particular worry at how the Bill totally disregards clinical governance- a key component of medical aid funds- and also how the Bill seeks to transfer medical aid regulatory powers to Namfisa.

In a Parliamentary Committee submission made by Stephen Tjiuoro the NAMAF CEO in view of the regulatory framework of medical aid funds in Namibia, the association highlighted that financial supervision alone as provided by the FIM Bill will not ensure sustainable access to affordable and appropriate care that is of a high quality, regardless of the mode of financing such healthcare.

However, sustainability can only be achieved through managing the demand for care by keeping healthy people healthy for as long as possible and keeping complications and co-morbidities of illnesses to a minimum.

“These are clinical, as opposed to financial, interventions,” the submission reads in part adding that there can be no doubt that traditional financial regulation is of paramount importance for obvious reasons, and this is more than adequately catered for in the current legislation.

NAMAF explained that it is concerning that the notion of behavioural or conduct regulation has been de-emphasised in the Financial Institutions Management Bill with no mention being made of the need for clinical risk management and the role of a behavioural or conduct regulator has not been clearly outlined.

“In fact, the proposed legislation does not make provision for a continuation of the conduct (control, promote, encourage and co-ordination) regulatory function that NAMAF is responsible for currently. This will ultimately be to the detriment of the medical aid fund industry as whole and situation such as the PSEMAS experience could become the order of the day.

“Medical aid funds require a second level of regulation that pertain to the ensuring of the effectiveness and efficiency of care through the regulation of the healthcare related behaviours of industry stakeholders. Although NAMAF is currently mandated with this second level of regulation, the need for such regulation has been de-emphasised in the proposed legislation.

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If not addressed the long-term sustainability of the industry will be affected negatively and access to affordable care of a high quality will be compromised,” Tjiuoro further emphasised.

Although the FIM Bill does not formally repeal the Medical Aid Funds Act, NAMAF highlights that it does seem to aim to transfer all regulatory powers with respect to medical aid funds to NAMFISA.

“The concern is not so much whether the Medical Aid Funds Act is going to be repealed or not and/or whether the Namibian Association of Medical Aid Funds is going to continue to exist or not. The concern is that the FIM Bill almost exclusively focusses on the supervision of financial and related matters pertaining to medical aid funds by NAMFISA.

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“Other than a brief reference to managed health care in Section 410 (8) (aa), no references are made to the management of clinical risk and/or the behaviours of members and/or suppliers. As mentioned, focussing on financial supervision alone could compromise the medical aid funding industry to the extent that it could become destabilised.

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This will particularly be the case in instances of open enrolment where medical aid funds will have little if any protection against adverse selection,” the association highlighted.

NAMAF maintain that current laws are drawing a clear distinction between the financial or prudential and the conduct supervision of medical aid funds respectively and it would be advisable to retain these law with amendments for improvements rather than replacing them with a law that ignores the key tenants of medical aid funds regulation.

NAMAF is a juristic body, established in terms of the Medical Aid Funds Act, 1995 (Act 23 of 1995) to control, promote, encourage and co-ordinate the establishment, development and functioning of Medical Aid Funds in Namibia.