Govt extends over ZWL$4bn bailout to PSMAS

Bridget Mabanda

The government has extended over ZWL$4,2 bail-out package to the Premier Service Medical Aid Society (PSMAS).

This comes as the Premier Service Medical Investments in October received a ZWL$1 million bailout from government for the restocking of its pharmacies.

In a statement, Public Service Commission said the package is intended to resuscitate operations at the society and support its subsidiary, (PSMI).

“The injection of funds will enable the restoration of operations at the embattled medical insurance group through, among other support, the clearance of salary arrears for PSMI staff,” reads the statement.

Some of PSMAS' medical facilities had closed in recent weeks.

According to the statement, this development will help in the re-opening of PSMI health care facilities across the country and restore operational viability.

Therefore, civil servants who subscribe to PSMAS' are expected to be able to access health care services from the society's clinics timeously.

However, the forensic audit at both PSMAS and PSMI are still ongoing and when finished, findings will tell how further governance matters will be dealt with.

PSMI had closed down some departments of two main hospitals in the country due to cash flow challenges.

In October, PSMAS employees claimed that they had gone for three months without salaries and had written several letters to their employer to understand the status of their unpaid salaries, a complaint which they say was often met with resistance, intimidation and threats of victimisation.

As a result, most employees had been evicted from rented accommodation, while some had their children sent back home from school over failure to pay fees. Some who had direct stop order payments for funeral assurance were in arrears and those with bank loans were facing litigation over defaulting.

PSMAS, which is the country’s largest medical aid insurance firm by subscription numbers, was also being accused of failing to remit statutory obligations such as Pay As You Earn (PAYE) deducted from workers’ salaries and over-borrowing.

Another accusation is that the firm had engaged middlemen in the procurement of drugs, a situation which pushed up the cost of drugs.

Currently, PSMAS executives, among them chief executive Farai Muchena, Victor Chaipa, Cosmas Mukwasha, Shingai Mabuto and Tafadzwa Gutu are on bail on a number of charges that include fraud, forgery and theft charges.