Eppel v Discovery Medical Scheme and Others (09/29184) [2009] ZAGPJHC 54 (25 September 2009)

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[2009] ZAGPJHC 54
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Eppel v Discovery Medical Scheme and Others (09/29184) [2009] ZAGPJHC 54 (25 September 2009)

IN THE SOUTH
GAUTENG HIGH COURT
(JOHANNESBURG)
CASE
NUMBER 09/29184
In the matter between
STEVEN
JOEL EPPEL
APPLICANT
and
DISCOVERY
MEDICAL SCHEME
FIRST RESPONDENT
DISCOVERY
HEALTH (PTY) LTD
SECOND RESPONDENT
COUNCIL
FOR MEDICAL SCHEMES
THIRD RESPONDENT
J U D
G M E N T
VAN
OOSTEN J:
[1] The
applicant Dr Eppel, is and has been a practicing psychiatrist since
1998. The vast majority of his patients are members
of and enjoy
medical health protection afforded by the first respondent medical
scheme which is administered by the second respondent
(Discovery).
The third respondent (the Council) has understandably not entered the
fray. The application arises from a dispute
between Dr Eppel and
Discovery concerning his method of billing Discovery. The procedure
followed was for Dr Eppel to bill his
patient which was then
submitted to Discovery for payment directly to him. The treatment
given is identified in the bill by way
of so-called billing codes in
accordance with Discovery’s billing manual. One thereof is relevant
for present purposes, which is
code 2975 applied in respect treatment
consisting of one hour of psychotherapy. Dr Eppel’s experienced
difficulty in applying the
codes in general and he says they were
anything but user-friendly. For that reason he decided to make use of
code 2975 as a “composite
or cumulative code” to apply also in
instances where strictly speaking the psychotherapy lasted for less
than one hour but his
treatment of the patient also encompassed
extensive time spent by him
inter alia
involving blood and
radiological investigations, both pre- and post consultation with the
patient. During November 2001 Discovery
queried Dr Eppels’ use of
inter alia
code 2975 where a complaint had been received of a
patient that the full consultation fee for one hour had been charged
for a consultation
of less than 5 minutes duration. Dr Eppel
responded with a detailed explanation for his use of the code which
was accepted “as
satisfactory” by Discovery. Dr Eppel accordingly
continued to charge on code 2975 as he had done before.
[2]
During December 2008 Discovery informed Dr Eppel that they had
conducted an investigation into his practice relating to
irregularities
concerning the manner in which he billed his patients.
Protracted correspondence and meetings between Dr Eppel and Discovery
followed
but the issues could not be resolved. In a letter dated 16
March 2009 Discovery informed Dr Eppel that
As
from today, Monday 16 March 2009, we will not pay any further claims
from your practice. Furthermore, we will not refund any
of your
patients who pay you directly either.
On 4
June 2009 Dr Eppel lodged an “appeal in terms of s 48(2) of the
Act” against Discovery’s “decision” contained in the March

letter (the appeal). Discovery in turn filed a complaint with the
Health Professions Council of South Africa against Dr Eppel.
Dr Eppel
was advised that the appeal by way of the operation of law
automatically suspended Discovery’s “decision” but Discovery

took the opposite view. The Council I have been informed, is busy
processing the appeal and has confirmed that it is arranging
a date
for the hearing of the appeal. Hence the present application which is
aimed at obtaining
interim
relief pending finalisation of the
appeal.
[3] The
relief sought in this application in essence is for a declarator that
the decision taken by Discovery in the letter not
to pay any further
claims from Dr Eppel’s practice is suspended in terms of s 48(2) of
the Medical Schemes Act 131 of 1998 (the
Act) pending the decision of
the Council on the applicant’s appeal in terms of section 48(1) of
the Act. The applicant further
seeks an order restoring the status
quo ante
as far as payments of his claims by Discovery are
concerned, pending the outcome of the appeal.
[4] The
application is opposed by Discovery principally based on the
contention that the applicant’s reliance on s 48 (1) and (2)
of the
Act is misconceived. I will revert to this aspect later in the
judgment.
[5] At
the outset it is necessary to consider the nature of the relationship
that existed between Dr Eppel and Discovery. The applicant
evidently
premised the application as will become apparent on an interpretation
of s 47 and 48 of the Act and therefore must have
assumed that their
relationship is governed by statute. The assumption is clearly wrong.
The applicant states that their relationship
has, for a number of
years been conducted in terms of an agreement styled Discovery’s
Premier Rate Agreement. Preciously little
has been revealed
concerning the agreement. All that has been stated by Dr Eppel is
that he billed his patients in terms of that
agreement which were
then submitted to Discovery for payment to him directly. In the
answering affidavit this aspect is taken one
step further: firstly, a
copy of a document (a fax cover sheet with annexure thereto) signed
by Dr Eppel on 4 June 2006 evidencing
below his signature his
“agreement to participate in the Discovery Health Premier Rate
Agreement, subject to 30 days written notice
by either party” is
annexed and secondly, in regard thereto it is stated
The applicant has however acted in
breach of its provisions by employing billing codes which
misrepresent the nature and/or duration
of his actual attendances,
to the prejudice both of his patients and of the First Respondent
and its members.
Except
for the two page annexure containing information on the Discovery
Health Premier Rate arrangement, nothing has been made
known
concerning the terms of the agreement. What remains beyond question
however is that there exists a contractual relationship
between the
parties. As much was readily and in my view correctly, conceded by
counsel for the applicant. But it goes further,
whatever those terms
may be Discovery in legal phraseology has alleged a
breach/repudiation of the agreement by Dr Eppel entitling
them to
cancel the agreement. Discovery’s allegations in this regard stand
uncontroverted. There is nothing before me to show that
they were not
entitled to do so. The logical conclusion flowing from this is that
the provisions of the Act accordingly do not
apply and that the
applicant’s reliance on those provisions indeed is misconceived.
For this reason alone the application is doomed
to failure.
[6] The
argument before me proceeded on an interpretation of the Act.
Although I have found that the Act is not applicable I consider
it
necessary to briefly express my views on the arguments presented in
respect of which I in any event would also have found against
the
applicant. The starting point is to consider the purpose of the Act
as stated in the preamble thereof which paraphrased is
to provide for
the registration, operation and control of medical schemes and
importantly the protection of members of medical
schemes. What is
seemingly absent from the Act are any provisions relating to the
relationship between medical schemes and medical
practitioners who
after all are the other class of beneficiaries of medical schemes. It
is perhaps convenient at this juncture
and for the ease of reference
to quote the provisions of s 47 and 48 in full:
47. Complaint
– (1) The Registrar shall, where a written complaint in relation
to any matter provided for in this Act has been lodged with
the
Council, furnish the party complained against with full particulars
of the complaint and request such party to furnish the
Registrar
with his or her written comments thereon within 30 days or such
further period as the Registrar may allow.
(2) The Registrar shall, as soon as
possible after receipt of any comments furnished to him of her as
contemplated in subsection(1),
either resolve the matter or submit
the complaint together with such comments, if any, to the Council,
and the Council shall
thereupon take all such steps as it may deem
necessary to resolve the complaint.
48. Appeal
to Council
– (1) Any person who is aggrieved by any decision
relating to the settlement of a complaint or dispute may appeal
against such
decision to the Council.
(2) The operation of any decision
which is the subject of an appeal under subsection (1) shall be
suspended pending the decision
of the Council on such appeal.
It is
common cause that the applicant has not lodged a complaint within the
meaning of s 47. Discovery is of the view that the applicant
could
possibly only have relied on these sections had he lodged a
complaint. The contention is unassailable. In any event what
the
applicant has endeavoured to do in this application is to force into
the provisions of s 48 the situation where a medical practitioner
is
dissatisfied with any decision taken against him by the medical
scheme. The attempt sparked off interesting and even ingenious

arguments concerning the interpretation to be afforded to s 48 (1)
brought about by the (as so often happens) the much debated

disjunctive of conjunctive appearance of the words “or dispute”
in s 48(1) which absence the reference to a dispute in s 47, led

counsel for the applicant to conclude that Discovery’s letter
constituted a “decision” relating to a “dispute” in regard to
the
billing codes used by Dr Eppel in respect of which an appeal lies
and was noted to the Council which then of course would bring
into
operation the suspension of the decision provided for in sub s (2) on
which the present application is based. The contentions
in my view
cannot be sustained for the plain reason that it simply falls foul of
the clear intention of the legislature which was
to provide for a
mechanism to deal with complaints and appeals in relation to matters
provided for in the Act. The applicant stands
in a relationship
vis-à-vis Discovery that is purely contractual in nature upon which
it is impossible to paste those provisions
cut from the Act. Any
attempt do so by employing interpretive measures merely leads to
artificial and fanciful arguments. As counsel
for the respondents
aptly and correctly put it, it could never have been the intention of
the legislature to render any decision
even one by a medical scheme
in relation to any dispute whatsoever, subject to s 48(1) and (2).
[7] The
application is dismissed with costs.
_______________________
FHD VAN OOSTEN
JUDGE OF THE HIGH
COURT
COUNSEL FOR
THE APPLICANT ADV H EPSTEIN SC
ADV K HOPKINS
APPLICANT’S
ATTORNEYS GISHEN GILCHRIST c/o GLOVER INC
COUNSEL FOR
1
st
& 2
nd
RESPONDENTS ADV F SNYCKERS
1
st
& 2
nd
RESPONDENTS’ ATTORNEYS JOHN BROIDO ATTORNEYS
DATE OF
HEARING 17 SEPTEMBER 2009
DATE OF JUDGMENT 25
SEPTEMBER 2009