Institute of People Management Malawi (IPMM) and the Consumers Association of Malawi (Cama) have hit at the Medical Aid Society of Malawi (Masm) for raising premiums twice this year.
IPMM general secretary Prescott Nkhata said, in an interview on Thursday, the adjustments have gravely affected both employees and employers as the Masm deductions are eating heavily into their disposable income.
IPMM , a professional membership body representing human resource and people management fraternity, said both employers and employees plan for at least a year and the midyear adjustment is disturbing and unjustifiable.
“Masm would have done better to differ this to next year, 2018, and if they wanted, include at that time what they may have lost,” Nkhata suggested.
Also supporting IPMM’s positionvthat the premium adjustments by Masm were irrational in an interview on Friday, Cama executive director John Kapito further asked Masm to reverse the adjustments immediately.
“We don’t even need to push Masm to do the needful. It’s the findings of the Competition and Fair Trading Commission (CFTC) that have revealed that Masm cheated us about its socalled ‘no short-fall policy’, which was misleading and they have been fined for,” said Kapito.
He added: “If they want a push for them to do the right thing, we will be more than willing to provide that. But we believe they are reasonable people and they will do the right thing. The least we expect from them is to reverse the adjustments.”
He said as providers of health insurance, it is strange that Masm can make fees adjustments twice in a year when insurance holders and companies plan for at least a year.
“You cannot just wake up one morning and unilaterally say: ‘We have adjusted our premiums’. How do you expect people to manage their financial obligations that way?” he said.
The first adjustment was effected in January while the second came into effect on September 1 2017.
The second premium adjustment came six months after the ‘no short-fall policy’ was introduced, raising fears that the new policy might have crippled the society’s resources, hence the decision to place the burden on the society’s clients.
Catholic University of Malawi (Cunima) head of economics department Gilbert Kachamba is on record as describing the adjustments as ‘too much and unjustifiable’ while CDH Investment Bank (CDHIB) managing director Misheck Esau argued that the hike was not surprising because the ‘no shortfall’ policy required deep pockets, which Masm did not have.
Masm in January claimed it had introduced a ‘no short-fall policy’ and adverts were being aired in different radio stations and published in newspapers, but CFTC said it received complaints from Masm membership that the ‘no short-fall policy’ was misleading as some hospitals were still imposing the shortfalls.
Following the allegations, the commission launched investigations on Masm in March, and also ordered the health insurance provider to stop broadcasting or publishing the deceptive adverts on the ‘no short-fall’ initiative.
Ironically, it has transpired that the ‘no short-fall policy’ never existed, resulting in CFTC slapping Masm with a K5 million fine for deceptive advertising.
When called for comment, Chikoti, who is out of the country, said he would respond to the matter when he returns home.
“I have not seen the report from CFTC since I am out of the country. I will only be able to respond once I am back in the office on Monday,” he said.