The Council for Medical Schemes (CMS) has issued a formal media response to the Med Brief Africa report “Would schemes be better placed under a financial regulatory authority?” posted on 27 October.

The report was on an Institute of Health Risk Managers (IHRM) webinar presentation by health legal expert, Dr Debbie Pearmain (link

The response reads as follows:

The Council of Medical Schemes (CMS), a statutory body established by the Medical Schemes Act (131 of 1998) (MSA), is the regulatory body adopted by the legislature to supervise access to privately funded health care services.  Access to health care services is a constitutional imperative and a state obligation regulated by section 27 of the Constitution.  

The CMS and the National Treasury’ financial regulators – Prudential Authority (PA) and Financial Sector Conduct Authority (FSCA) – have a long-standing framework to demarcate the financial services/ products from health services/ products. Section 264 of the Financial Service Laws Amendment Act, 2013, that amended the definition of medical schemes’ business was a definitive breakthrough for CMS and the PA/ FSCA. 

In recognition of the need to demarcate health products from financial products, the Conduct of Financial Institutions Bill (COFI) has been updated to maintain this segregation. The dual regulatory framework in the financial sector laws lingers in terms of section 291 of the Financial Sector Regulation Act, 2017 (FSR Act) as a transitional arrangement until March 2024. Pending amendment of the Medical Schemes Act, 1998, this arrangement is expected to be extended further. 

The CMS is, following provisions of section 7 of the MSA, works closely with the National Department of Health (NDoH) to address regulatory gaps identified since the adoption of Twin Peaks, identified through the Health Market Inquiry (HMI) and in anticipation of the National Health Insurance Bill (NHI). 

It is important to underline that the health care sector legislative framework is a constitutional mandate in section 27(2) of the Constitution. In comparison, the financial sector legislative framework is constitutionally provided for by sections 223-225 of the Constitution. 

Therefore, all legislative measures concerning these sectors should remain true to the Constitution. Access to health care services is made possible through principles of open enrolment, community rating.  

Premiums or subscription settings based on age, health, marital status, gender, sexual orientation, or geographic location are essential to the financial sector and its profit motive. Imposing similar risk-rating practices to health care services and products would make the cost of access to health care services and products expensive.

In the given mandate of the CMS and the constitutional agenda of the state to enable access to health care services,  it goes without saying that CMS and a comprehensive health sector legal framework is the best vehicle to protect the  interests of members of medical schemes. 

SOURCE: CMS Media Enquiries