COMPETITION COMMISSION REPORT
Efficiency behind Discovery’s health, says CEO
Discovery Health CEO Jonathan Broomberg launched a robust defence of the company on Thursday, saying its sustained profit was due to its efficiency and not abnormally high fees. He was responding to the Competition Commission’s report on the private health market. The commission said Discovery Health’s operating model had enabled it to make large profits over a sustained period, which were far in excess of its competitors. The provisional report, released at a briefing by former chief justice Sandile Ngcobo on Thursday, said the absence of effective competition to Discovery Health’s dominance, which was growing ever stronger, was an indication of "market failure". The report did not suggest specific remedies to redress this dominance, but proposed a raft of measures to enhance competition in the medical-schemes market and to ensure better governance by administrators. Broomberg rebutted accusations that Discovery Health charged higher than necessary service fees to its medical schem...
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