Discovery Health hails ConCourt’s RAF ruling

The Constitutional Court (ConCourt) has refused an application by the Road Accident Fund (RAF) for leave to appeal a ruling by the High Court in Pretoria that declared unlawful the fund’s directive that no payments must be made to claimants if their medical aid scheme has already paid for their medical expenses arising from a road accident.

In an order handed down by SA’s highest court on Wednesday, the ConCourt said it had considered the application for leave to appeal and concluded that “it does not engage the jurisdiction of the court”. The move has been welcomed by Discovery Health.

Medical aids v RAF: Leave to appeal refused with costs

“Consequently, leave to appeal must be refused. The court has decided to award costs. Leave to appeal is refused with costs,” it said.

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The ConCourt judges who considered the RAF application were Deputy Chief Justice Mandisa Maya and judges Jody Kollapen, Rammaka Mathopo, Nonkosi Mhlantla, Owen Rogers, Ashton Schippers, Leona Theron and Zukisa Tshiqi, as well as and Acting Justice Van Zyl.

The High Court and Supreme Court of Appeal (SCA) previously also dismissed appeals by the RAF against the judgment and order of the High Court in Pretoria.

The directive, issued on 12 August 2022 by the RAF’s acting chief claims officer, was declared unlawful on 27 October 2022 following an urgent application launched by Discovery Health. There has been widespread condemnation of the RAF’s directive.

The RAF was set up as a public entity to pay compensation to victims of road accidents and the medical expenses associated with treating these injuries. It is funded by a special fuel levy on petrol and diesel, which is currently R2.18 per litre.

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Discovery Health welcomes ruling

Discovery Health’s outgoing CEO Dr Ryan Noach said on Wednesday night that it is pleased with the ConCourt ruling.

Noach said this ruling now confirms all prior rulings, making the decision final and binding on the RAF.

“The ConCourt ruling means that medical scheme members retain the right and entitlement to claim medical expenses from the RAF, in accordance with the Road Accident Fund Act, and over a century of common law precedent,” he said.

“This is an important fairness and equity principle that has prevailed, and represents a victory in the public interest for all members of medical schemes in South Africa,” he said.

Noach said Discovery Health and all related parties involved in the process of claiming from the RAF will immediately ensure that the valid claims submitted to the RAF are advanced to ensure the rightful processing and settlement of these claims for members of schemes.

He added that, as previously confirmed, this ruling does not have any short-term impact on the Discovery Health Medical Scheme (DHMS) or other schemes administered by Discovery Health, but it does serve to protect members from possible higher costs in the longer term.

Noach said that the ConCourt ruling bears testimony to the integrity and independence of South Africa’s judicial processes, forcefully ensuring the fairness of the RAF’s conduct towards all South Africans.

The RAF is yet to comment on the ruling. Moneyweb will add the fund’s comment once it has been obtained.

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Not entitled

Judge Mandla Mbongwe, on handing down judgment in the High Court in Pretoria to Discovery Health’s application to review and set aside the RAF directive, said the legal position is that the RAF is not entitled to seek to free itself of the obligation to pay full compensation to victims of motor vehicle accidents.

“Thus the directive challenged in the present proceed is outside the authority given by the enabling statute. More specifically the directive is inconsistent with the express provisions of Section 17 [of the RAF Act] and is, consequently, unlawful,” he said.

Judge Mbongwe added that the social security protection the RAF Act provides is in no way intended to impoverish medical schemes who, were the directive to stand, would face a one direction downward business trajectory as a result of their members becoming victims of motor vehicle accidents.

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“The levy paid on fuel provides the funds for payment of compensation to motor vehicle accident victims and nothing in the law obliges medical aid schemes to contribute towards such compensation by the payment, from the time of hospitalisation and treatment of a motor vehicle accident victim, of medical expenses without a reasonable expectation of reimbursement upon settlement of the claimants’ claims in terms of the RAF Act.

“It is for that expectation that medical schemes enter into agreements with their members and provide relevant invoices of medical expenses incurred to be considered in the calculation of the claimants’ claims. Settlements of victims’ claim is in full and final settlement,” he noted.

“This means that, unless the past medical expenses form part or are included in the settlement amount, medical aid schemes will not be reimbursed for the medical expenses they paid. Worst still, medical schemes would have no standing to recover those expenses due to the claimant’s claims having been settled in full and final settlement.

“The only way to prevent their loss of expenses incurred for the medical treatment of their client victims of motor vehicle accidents, would be for the medical schemes to institute concurrent claims against the RAF and in due course seek the consolidation of the hearing of the two matters.

“The costs of the proceedings will be astronomical and unnecessarily incurred by the RAF which, in terms of the Public Finance Management Act, will constitute wasteful expenditure,” said Judge Mbongwe.

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This article is republished from Moneyweb under a Creative Commons licence. Read the original article.