MEDICAL aid service provider, Cimas says it is unable to pay the newly gazetted doctors’ fees, saying the new charges were not viable, following threats by the government that the company faced closure for not complying with the directive.
Cimas said if it were to pay the new tariffs, it would have to increase members’ subscriptions, which was not possible as this would become unaffordable for its members.
“Cimas has no intention of defying any regulations,” the medical insurance company said in a statement yesterday.
“The failure to settle claims at the gazetted maximum tariff charges is based purely on economic principles.”
The government has directed medical aid societies to pay the newly gazetted fees backdated to May, or risk losing their licences.
Deputy Health and Child Care minister, Paul Chimedza warned that Cimas, First Mutual Life, Masca and Sovereign Health had failed to comply with the government’s orders and risked closure.
But Cimas insists that it is difficult for the government to justify increases of more than 75% in a low inflation environment.
“The only way in which Cimas could afford to pay the gazetted rates without increasing contributions would be if it dips into its reserves,” the society said.
“Not only would the depletion of reserves in this way contravene government regulations but it could lead to the reserves being exhausted within less than three years.”
Cimas’ licence expires at the end of the year and the government may decline to renew next year, if the present stand-off continues.