A technical committee of public and private sector officials was appointed towards the beginning of this year to assess the status of the Public Service Medical Aid Scheme (Psemas) and to propose reforms for the optimal restructuring if the scheme.
Upon enquiry a finance ministry spokesperson recently told New Era the reform process, which includes achieving internal cost savings and alternative modes of service provision, is still ongoing.
Finance ministry spokesperson Tonateni Shidhudhu explained the Psemas reform process is not entirely up to treasury as the procedure involves numerous internal and external stakeholders.
Psemas falls under the ambit of the finance ministry and during the 2021 national budget the medical aid scheme received some N$2.6 billion or 55.4% of the ministry’s annual budget.
Out of the ministry’s total allocation a further N$484 million was ring-fenced under Psemas for the procurement and distribution of the Covid-19 vaccine.
Psemas and Covid-19
In addition, Psemas covers the majority of the cost of a Covid-19 test, or up to 95% of the tariff, if a member is booked for surgery. However, the fund does not cover routine tests, such as suspected contact cases and people showing symptoms.
The decision to cover the virus tests were confirmed by the finance ministry’s then executive director Ericah Shafudah after private health facilities insisted on patients being tested for Covid-19 before any surgery could be performed.
This means that at PathCare, where a Covid-19 test costs more than N$800, a Psemas member would have to pay about N$42 and at the Namibian Institute of Pathology a member will have to pay approximately N$27 while the full price is N$522.50.
Psemas membership contributions were increased last year by 100%, from N$120 to N$240 for main members while coverage for dependents is now charged at N$120 per person.
Psemas membership
There is no doubt that Psemas greatly benefits its over 290 000 members. Psemas has more members than all the Namibian private medical aids combined, which total about 202 000 beneficiaries primarily managed by five separate administrators.
Since 2016 Psemas has received about N$7 billion from government and has an annual budget of more than N$2 billion. In 2016, the fund received N$2.2 billion, N$2.5 billion in 2017, N$2.5 billion in 2018 and N$2.6 billion in 2021.
However, exponentially increasing expenses led to Psemas embarking on a verification process in 2018 to mitigate costs. This process saw Psemas trimming its beneficiaries by over 17 000 over-aged dependants as government considers a dependant to be over-aged once they reach 21 years.
This dependent limit may be adjusted to 25 when beneficiaries are studying.
Ghost members
However, despite the precautionary measures it emerged in the finance ministry’s 2019/2020 Accountability Report that there were over 36 000 ghost beneficiaries on Psemas. This shocking figure was discovered during the second phase of the scheme’s membership verification project. The ghost beneficiaries are individuals who appeared nowhere on the public service payroll system and were subsequently removed from the scheme.
In addition, the finance ministry also discovered that about 32 000 Psemas members were not contributing to the medical aid but were enjoying full benefits. The ministry had budgeted N$545 million in membership contributions to Psemas but received N$109 million less than expected.
At least during the 2019/2020 financial year, the ministry managed to collect N$15 million in arrear payments from non-paying members and noted that the collection process is ongoing.
In a report on Psemas, the International Monetary Fund proposed government considers linking workers’ contributions to their salaries.
“Improve forecasting of the cost of future benefits and budget for it accordingly. Include a provision in the budget to manage unanticipated costs,” read the IMF report.
Psemas abuses
Meanwhile, deputy finance minister Maureen Hinda-Mbuende recently sent a stern warning to government employees abusing Psemas, saying her ministry will initiate criminal proceedings against perpetrators.
Speaking exclusively to New Era Hinda-Mbuende said the finance ministry is aware of government employees abusing the medical aid scheme by allowing family who are not members to use it.
“You will have someone who is based in Windhoek, but his or her medical aid card is being used by someone who is in Keetmanshoop or in Rundu, while at the same time the card is being used in Windhoek. That is what I am talking about. We are closing in on perpetrators, and criminal proceedings will be initiated against such perpetrators,” warned Hinda-Mbuende.
“Many people see this as a brotherhood, but this is a criminal action, and actions should be taken against perpetrators,” she warned.
She added that serious action will also be taken against medical doctors abusing the scheme by claiming that they had treated patients, although they had not.
“These things happen every day where you will find a doctor putting in claims, sometimes beyond their capabilities. You know a day has eight hours, but sometimes you will find out that one doctor has put in claims that he/she has treated 20 or 30 patients a day, which to me really doesn’t add up,” she stated,
The deputy minister said her ministry is currently working on a plan to punish such healthcare practitioners abusing the system.
Psemas administration
At the end of 2020 the Central Procurement Board of Namibia (CPBN) cancelled the lucrative tender to administer Psemas “due to non-responsiveness after going through a rigorous evaluation process”.
This meant the finance ministry was required to re-assess the tender requirements that led to the cancellation of the bid and has to resubmit any changes to the CPBN.
The CPBN confirmed that of six bids received and evaluated by the Bid Evaluation Committee (BEC), all were found non-responsive as they did not meet mandatory and eligibility evaluation criteria of the Public Procurement Act (PPA).
In addition, the CPBN also asked bidders to complete company shareholding information and to submit CVs and certified copies of qualifications of essential personnel, including a pharmacist registered with the Health Professional Council of Namibia (HPCN); a dentist registered with the HPCN; medical doctors registered with the HPCN; and two specialists in different medical fields, registered with the HPCN.
The Psemas tender was first advertised in June last year with a deadline of 22 July 2020. This deadline was later extended to 23 September 2020 due to amendments that were made in the Standard Bidding Document (SBD) as well as to provide bidders sufficient time to complete the required documents.
Considering these shortcomings by the bidders, the BEC recommend the cancellation of the Psemas bid to the CPBN, which was subsequently approved.
“The board or a public entity may, at any time prior to the acceptance of a bid, rejects all bids or cancel the bidding process, if - (a) all the bids are non-responsive,” the CPBN communicated to all bidders.
Earlier in 2020 a local medical aid administrator, Prosperity Health, objected to conditions in the tender to administer the government medical aid, saying these were inadvertently drafted to exclude all potential participants except the current holder of the tender, which is Methealth Namibia.
– Additional reporting by Kuzeeko Tjitemisa