Govt authorises N$200 million towards Psemas bill

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WINDHOEK, 20 February 2017 - Finance Minister Calle Schlettwein addressing the chief executive officers and chairpersons of State-owned enterprises at the Namibia Institute of Public Administration and Management on Monday. (Photo by: Joseph Nekaya) NAMPA

Kuzeeko Tjitemisa

Windhoek-The Minister of Finance Calle Schlettwein said he has authorised that N$200 million of state coffers be used to partially honour payments for medical services provided to members of the Public Services Medical Aid Scheme (Psemas).

Replying to matters raised during the 2017/18 Appropriation Bill debate in the National Assembly last week, Schlettwein said this amount could not be met through provisions in the contingency fund.

“The payment is in respect of medical services rendered to Psemas members and their dependants during the 2016/2017 financial year, the cost of which lies in excess of the N$2.2 billion in the Psemas budget,” he explained.

Schlettwein said the provision of medical services is critical and essential for the sustenance and quality of life, especially in certain special and emergency circumstances.

“It is on the basis of these considerations that I have evoked this section of the State Finance Act to ensure payment for services rendered and thus the continuation of smooth provision of medical services to the members of Psemas and registered dependants,” he said.

In context, Schlettwein said, Psemas has a total 293 250 members of whom about 124 000 are principal members and the rest are pensioners and dependants.

This membership and dependency, he said, is in the ratio of about 13.1 percent of the total population and thus, substantial in its impact to the population and households.
He said the administration of Psemas is outsourced to MetHealth Namibia, to ensure an administrative arrangement based on specialised expertise for the highly specialised range of health services provided to Psemas members.

In recent years, Schlettwein said, the scheme has experienced a significant rise in the claims ration, resulting in the rapid rise of the allocated budget.

“The N$2.2 billion budget for 2016/17 is an increase of 22.7 percent from the previous year (N$1.76 billion), while the membership has grown by only 5.2 percent over the same period,” he said.

The finance minister said that due to high and increased patterns of claims, the total allocated budget to Psemas was by and large fully spent by December 2016, resulting in the build-up of unmet costs for services provided.

He said the build-up of outstanding invoices has placed cash flow constraints on service providers. As a result, he said, some service providers had to demand upfront payments by members for services rendered.

According to Schlettwein the finance ministry, in collaboration with the associations of medical services providers, has launched an investigation into high claims rations and the practices of some service providers.

This investigation, according to the minister, has unearthed a myriad of alleged unethical claims practices by some services providers.
He said such allegedly fraudulent claims have since been put aside for further in-depth investigation.

“As an outcome of these investigations and to ensure continuation of the provision of essential services, the government undertook to honour an amount of N$200 million for the medical cost in this current financial year,” he said, adding this equates to about 64 percent of overdue payments.

He further said the remaining amounts are budgeted for in the 2017/2018 budget and will be paid as part of the continuation authorisation in the coming month.

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