Managed healthcare : treatment protocols and fiduciary duties of funders

• Published date: 01 December 2020
• Date: 01 December 2020
• Author: A. Dhai,D. Masege
• DOI: 10.7196/SAJBL.2020.v13i2.731
• Pages: 129-132

SHORT REPORT

December 2020, Vol. 13, No. 2 SAJBL 129

Managed healthcare has become the cornerstone of health service

delivery in the private sector in South Africa (SA). As a result,

managed care organisations and medical aid schemes have had

to draw up recommended treatment protocols in accordance with

the rules and regulations of the Council for Medical Schemes (CMS).

CMS is a statutory body established under the Medical Schemes Act

No. 131 of 1998.[1] Most protocols are rigid, do not always consider

each case on its own merit and do not always benefit the members

of the respective schemes. The purpose of the protocols is to

determine which treatment options constitute essential medical

care and which do not. All role players in the healthcare industry

should distribute healthcare in the context of their fiduciary duties

to their members and patients. The principle of fiduciary duty is well

established in the doctor-patient relationship, a relationship of trust

and confidence.[2]

Managed healthcare is defined in regulation 15 of the Medical

Schemes Act[3] as:

‘clinical and financial risk assessment and management of

healthcare, with a view to facilitating appropriateness and cost-

effectiveness of relevant health services within the constraints

of what is affordable, through the use of rules-based and clinical

management-based programmes.’[3]

The intention of managed healthcare is to curb the ever-increasing

cost of private healthcare and through the use of rules and

protocols set by managed care companies and the medical aids,

to share the health funding pie equitably.[3] The selection or

rejection of health services are to be based on sound clinical

judgement from all the stakeholders, which include clinicians, case

managers at the managed care organisation, the hospital and,

lastly, the medical scheme itself, hereafter called the funders. In

its original form, managed healthcare was intended to save costs

without compromising quality of care.[4] However, because of the

rigid ‘cookbook’ approach, which follows particular ‘recipes’, the

protocols used by medical aid schemes are somewhat rigid, and are

not allowed to be tailored for a specific case should the need arise.

This article starts with a case report on a rigid approach by a

medical aid, which, if followed, would have resulted in serious

morbidity, if not mortality. The subsequent analysis makes the

argument that it is time for these protocols to be reviewed, as medical

aids are declining essential services in breach of their fiduciary duties

to their members, at times, to the detriment of the patient and their

dependents. It must be recognised that the one-size fiduciary law

does not apply to all fiduciary relationships.

Case report

An 18-month-old child was referred to a surgeon for an opinion for

a swelling on the side of the left jaw. The child had been treated by

a general practitioner (GP) with appropriate medication for 5 days

and was not getting better. The GP decided to refer the child for a

specialist opinion. After consultation with the mother and child, the

specialist made a diagnosis of a left parotid gland abscess (Fig. 1).

In view of the poor response to oral medication and the fever

that was not subsiding, the specialist decided to admit the child for

intravenous antibiotics and for possible incision and drainage of the

abscess. Following the procedure required by medical aids, the next

step was to obtain authorisation to admit the child. After the clinical

case was presented to the case manager at the medical aid and the

treatment plan outlined, the response from the medical aid was to

decline the admission. The message was that ‘there is no need for

admission as the child could take the medication orally at home.’

Despite a telephonic motivation, the decision stood. Some time

later, authorisation was given to admit the child for only one night,

and for the case managers of the admitting hospital to ‘update’ the

This open access article is distributed under

Creative Commons licence CC-BY-NC 4.0.

Managed healthcare: Treatment protocols and fiduciary

dutiesoffunders

D Masege,1 MB BCh, DCH (SA)FCS (SA)ORL; A Dhai,2 PhD, MB ChB, FCOG, LLM, PGDip Int Res Ethics

1 Department of Otorhinolaryngology/Head and Neck Surgery, Chris Hani Baragwanath Academic Hospital and University of the Witwatersrand,

final‑year student MSc (Bioethics and Health Law), University of the Witwatersrand, Johannesburg, South Africa

2 School of Clinical Medicine, Faculty of Health Sciences, University of the Witwatersrand, Johannesburg, South Africa

Corresponding author: D Masege (dipuo.masege@wits.ac.za)

Managed healthcare has become the cornerstone of health service delivery in the private sector in South Africa. As a result, managed care

organisations and medical aid schemes have had to draw up recommended treatment protocols in accordance with the rules and regulations

of the Council for Medical Schemes. The protocols are somewhat rigid, do not always consider each case on its own merit and do not always

benefit the members of the respective schemes. The purpose of the protocols is to determine which treatment options constitute essential

medical care and cost-effective treatment, and which do not. This article examines the fiduciary duties of the medical aids, and the existing

relationship between the managed healthcare company and the members in a trustee-beneficiary duty of loyalty.

S Afr J Bioethics Law 2020;13(2):129-132. https://doi.org/10.7196/SAJBL.2020.v13i2.731