THE Government Employees Medical Scheme (Gems) could be insolvent by financial year-end if drastic cost-containment measures are not instituted.This would mean the scheme would need to be bailed out by the Treasury or amalgamated into a different scheme, forcing significant changes in benefits for its 1.8-million members.It would be a big blow to those in government who hoped the scheme could provide a viable funding model for the proposed National Health Insurance.It would also be an embarrassment for the Council of Medical Schemes, which has used its discretion to avoid putting the scheme under curatorship, despite its longstanding failure to meet the industry’s minimum statutory requirements.Several sources within the industry, who spoke to Business Day on condition of anonymity, claim the scheme’s solvency ratio has plummeted in the first eight months of 2016, and may be as low as 5% or 6% — almost 20percentage points below the required level.Internal documents that Business Day...
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