Claiming Expenses from Both the Road Accident Fund and Medical Aid: What the Law Says

After a road accident, it’s common to need expensive medical care. Private hospitals and healthcare practitioners usually demand prompt payment – but a claim against the Road Accident Fund (RAF) can take several years to finalise. So what does the law say about claiming expenses from both the Road Accident Fund and medical aid?

Claiming RAF compensation for costs already covered by medical aid

It is legal to claim compensation for road accident-related medical costs from both your medical aid scheme and the RAF.

However, you’re generally required to refund the medical aid scheme for expenses that are subsequently recovered from the RAF.

If the RAF does not compensate you for particular medical expenses, your medical aid scheme remains liable for those costs, depending on your level of cover and available benefits.

How much to refund your medical scheme

It’s worth noting that a RAF payment may be made up of separate amounts, allocated as compensation for different categories of damages. Examples are medical expenses, loss of income and/or pain and suffering. This will depend on the circumstances surrounding a claim.

As a medical aid member, you’re responsible for paying back only the amount you receive from the RAF specifically for medical expenses.

This applies even if the RAF compensation for medical expenses is less than the amount paid out by your medical aid scheme.

Different approaches by South African medical aids

Medical aid schemes don’t all take a uniform approach to the recovery of accident-related funds from the RAF.

Requiring members to claim back expenses on their behalf

Some medical aid schemes put the onus on their members to initiate claims against the RAF on their behalf.

Before settling road accident-related claims, these medical aid schemes require members to sign written undertakings. In these, members agree to claim back their medical expenses from the RAF and to reimburse the schemes with whatever expenses are recovered.

In some cases, this type of undertaking obliges medical aid members to repay their schemes without deducting legal fees from the amount paid out by the RAF.

Using medical scheme attorneys to claim back medical aid expenses

Some medical aid schemes use their own attorneys to claim medical expenses from the RAF.

For instance, Libcare contracts the Medical Aid Recovery Unit of Alexander Forbes to process claims submitted to the RAF for reimbursement of funds paid by LibcareMedical Scheme.

An exception: foregoing claims for reimbursement

As an exception to the rule, at least one scheme – the Government Employees Medical Scheme (GEMS) – has chosen not to lay claim to medical expenses that its members recover from the RAF.

The issue of legal costs when refunding medical expenses

Some medical aid schemes allow their members to deduct legal costs incurred during the RAF claims process from the amount that must be refunded to them.

Other schemes require undertakings from members to repay accident-related medical expenses in full, regardless of legal costs they incur.

Right of medical aids to terminate membership

According to the Medical Schemes Act of 1998, a medical aid scheme has the right to terminate membership if a member fails to repay a debt owing to the scheme.

In 2011, a Council for Medical Schemes ruling upheld this principle in relation to RAF compensation owed to a medical aid scheme.

In R Bobroff & Partners obo Mr M Bellon v. Discovery Health Medical Scheme, the Council found in favour of Discovery Health and a termination of membership was upheld.