The finance ministry this week confirmed that as of 3 September 2021, more than 15 000 former civil servants can no longer benefit from the government medical aid.
This follows a verification project that commenced in 2018.
The Public Servants Employee Medical Aid Scheme (Psemas), which falls under the ambit of the finance ministry, gobbles up more than 55% of treasury's annual 2021 budget.
Alarmingly increasing Psemas expenses led to the verification process kicking off in 2018 to mitigate costs. At the time, the fund already trimmed more than 17 000 beneficiaries, identified as over-aged dependents.
Also, in the ministry's 2019/2020 Accountability Report over 36 000 ghost beneficiaries were identified.
This was discovered during the second phase of the scheme's membership verification project that further determined some 32 000 members were not contributing the required fees but were enjoying full benefits.
During the current financial year alone, the government medical aid scheme received
some N$2.6 billion of the finance ministry's budget. The ongoing verification process, involving numerous internal and external stakeholders, aims to achieve cost savings and alternative modes of service provision.
In addition to the N$2.6 billion Psemas received this year, another N$484 million was ring-fenced for the procurement and distribution of Covid-19 vaccines during this financial year.
In announcing Tuesday's termination of retired government employees still benefitting from the scheme, a communiqué from the ministry quoted the public services staff rules for Psemas that state pensioners "must apply on the prescribed application form for membership of Psemas at the Ministry
of Finance within 90 days from the date of retirement. If not s/he will forfeit such rights".
Moreover, these staff rules suspend medical aid membership if a pensioner is in arrears with contributions of three months as well as if any money is owed and is not paid within a month of being notified.
"In reference to the above-mentioned staff rules, the ministry conducted a Psemas membership verification project in which it was established that 15 162 retired staff members are not contributing to the fund and have failed to re-apply for medical aid at retirement - even though they fully benefitted from the scheme since
"It was further established that a segment of these retirees withdrew their full pension benefits. It is required that contribution for Psemas should be deducted from pension benefits monthly," reads the statement from the ministry.
The statement further reminded all government employees to apply within 90 days upon retirement if they wish to continue with Psemas medical aid benefits.
To this end, the ministry, through the Government Institutions Pension Fund (GIPF), has also been carrying out public education campaigns for retirees concerning non-compliance.
"We are currently consulting with key stakeholders to see if there is any possibility of deviating from the staff rules, and the public will be informed. The ministry urges all staff members in the public service, especially those nearing the age of retirement, to acquaint themselves with the staff rules and regulations on Psemas to avoid forfeiting their medical aid benefit," reads the statement.
By the last count, Psemas had over 290 000 members, which is more than all Namibia's private medical aids combined, and these total about 202 000 beneficiaries primarily managed by five separate administrators.
In a report on Psemas, the International Monetary Fund proposed government considers linking workers' contributions to their salaries.
"Improve forecasting of the cost of future benefits and budget for it accordingly. Include a provision in the budget to manage unanticipated costs," read the IMF report.
Deputy finance minister Maureen Hinda-Mbuende recently issued a stern warning to government employees abusing Psemas, saying her ministry will initiate criminal proceedings against perpetrators.
Speaking to New Era, Hinda-Mbuende said the finance ministry is aware of government employees abusing the medical aid scheme by allowing family, who are not members, to use it.
Since 2016, Psemas has received over N$10 billion from government and has an annual budget of more than N$2 billion. In 2016, the fund received N$2.2 billion, N$2.5 billion in 2017, N$2.5 billion in 2018 and N$2.6 billion in 2021. - firstname.lastname@example.org