Van den Heever said this was because hospital insurance plans undermine medical aid schemes by encouraging young people to save money by buying insurance in preference to joining a medical aid scheme.
But medical schemes depend on younger members to subsidise older members, who are more likely to become ill.
Without this cross-subsidisation, he said, medical aids would be forced to increase their premiums.
Insurance products offer limited coverage for some healthcare costs and sell for between R120 and R350 a month.
Medical aids are more expensive because they must comply with the Medical Schemes Act, which demands that they offer "social protection" to their members and include the prescribed minimum benefits as laid down in the legislation.
Treasury draft regulations propose that hospital insurance plans that pay out R3,000 a day co-exist with medical aids.
But Van den Heever said this proposal was "irrational" and was a result of the Treasury allowing itself to be "lobbied" by the insurance sector and not allowing an open debate on the issue.
The Treasury's Deputy Director-General, Ismail Momoniat, disputed this claim, saying the Treasury had consulted Van den Heever himself, as well as NGOs such as Section27 and the Helen Suzman Foundation. He said there was to be a second round of consultations.
Van den Heever warned that health insurance offered only limited cover.
"There are no guarantees or protection in law [for people taking out such policies]," he said.
But Steph Bester, Chief Executive of The Unlimited, a company that sells insurance products to poorer people, said: "The current reality is that only 17% of South Africans can afford medical aids. For people who can only afford hospital plans, at least a R3,000 payout helps them if they are ill," he said.
Source: The Times via I-Net Bridge
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