2016 agm annual general - my · 1.9 other matters ts 1.10closing ts b) nmc board of...

Meeting12h00Monday, 29 June 2015Arebbusch Travel Lodgec/o Golf Street & Auas RoadOlympia, Windhoek

Annual General

Date: 30 June 2016Venue: NamPower Convention

Centre, Cnr. Goethe & Dr. Kenneth David Kaunda Street

Time: 12h00

Visit www.nmcfund.com for more information.

2016 AGMwww.nmcfund.com

Enclosed in this notice:

a) Agendab) NMC Board of Trustees / Auditor / Actuaryc) 2015 AGM Minutes d) Chairperson’s Reporte) Administrator’s Reportf) Executive Review by the Actuaryg) Performance of Fundh) Membership Statisticsi) Trustee Fees

a) Agenda1.1 Opening and Welcome PO1.2 Constitution of the Meeting PO/EY1.3 Approval of the 2015 AGM Minutes TS1.4 Chairpersons Report and Administrator’s Report TS1.5 Executive Review NS1.6 Investment Overview HK1.7 Approval of the Annual Financial Statements, 31 December 2015 TS1.8 Approval of the Trustee Fees PO1.9 Other matters TS1.10 Closing TS

b) NMC Board of Trustees/Auditor/Actuary – 2015-20162.1 Board of Trustees - Chairperson: T. Smit, Deputy Chairperson: V. Malango Trustees: R. Coomer, R. Izaks, P. Mutota, H. Muisoor, G. Kamatuka, R. Doëses, D. Louw, A. Benjamin, S. Mbidhi (appointed) 2.2 PrincipalOfficer:A.Begley2.3 Auditor - Ernst and Young Chartered Accountants2.4 Actuary - i3 Actuaries

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c) 2015 AGM Minutes1.3 Approval of the 2015 AGM Minutes

MINUTES OF AN Annual General Meeting OF NAMIBIA MEDICAL CARE HELD ON 29 June 2015 AT AREBBUSCH TRAVEL LODGE, c/o GOLF STREET AND AUAS ROAD, WINDHOEK AT 12H00

PRESENTS

The Chairperson, T. Smit together with 81 members and 2 071 proxies.

Officials in Attendance: P Herlé Trustee G Kamatuka Trustee A Katjimune Trustee D Louw Trustee L Minders Trustee P Olivier Trustee ABegley PrincipalOfficer T Opperman Administrator F Amulungu Administrator O Ferrari Administrator T Horn Administrator S Krügel Administrator N Nel Administrator J Pote Administrator (Secretary) Nico Smit Actuary Hein Klee Investment Consultant Sam Murwisi Auditor L’oreal Tjiueza NAMFISA R Kefas NAMFISA

1. OPENING AND WELCOME ThePrincipalOfficerwelcomedallattendeeswithaspecialwelcometotheTrustees,the Investment Consultant, representatives from the Auditor, NAMFISA and the Administrator.

2. CONSTITUTION OF THE MEETINGNotice of the annual general meeting was published in the Namibian and Die Republikein inMayandJune2015.Thenotice,theagendaofthemeetingandtheannualfinancialstatementsforthe2014financialyearweremadeavailabletomembersontheNMCwebsite.Thenoticewas takenas readandthePrincipalOfficerannouncedthat themeeting was duly constituted with 81 members in attendance and 2 071 proxies.

3. APPROVAL OF 2014 AGM MINUTES The 2014 Minutes were approved.

4 CHAIRPERSON’S REPORTThe Chairperson presented his and the administrators report for 2014.

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5. EXECUTIVE REVIEWThe Actuary to the Fund, Mr Nico Smit presented his actuarial report for 2014. Mr. Ben Nandago, employee of the administrator presented a comparison of the self-medicationbenefittothemeeting,highlightingthatthebenefit is in linewiththebenefitofcompetitors.

6. INVESTMENT OVERVIEW The Investment Consultant, Mr Hein Klee presented an overview of the performance of the Fund’s investments for 2014. Mr Klee informed the meeting that investments accumulated positively in 2014 and that both the Asset Managers, namely Namibia Asset Managers and Sanlam Namibia performed within their targets. The mandate of theinvestmentmanagersistoachieveinflationplus3.5%overarollingperiodofthreetofiveyears.

7. APPROVAL OF ANNUAL FINANCIAL STATEMENTS 31 DECEMBER 2014The Statements were presented by the Chairperson who informed the meeting that the Fund showed a net healthcare surplus for 2014 of N$15 million and a net surplus of N$42 million. The 2014 Annual Financial Statements were adopted by the meeting.

8. APPROVAL OF TRUSTEE FEESThePrincipalOfficer informed themeeting that the feesTrusteesarepaid toattendmeetingswerepreviouslyadjustedbyinflationonanannualbasis,butthatNAMFISAhad advised that Trustee fees should be approved by members at the Annual General Meeting.ThePrincipalOfficerpresentedthefeesoftheotheropenfundsinthemarketas a comparison to the fees that Trustees of NMC are paid. The Trustee fees as proposed (below) for 2015, backdated to 1 January 2015, were approved as follows:

Board Sub Committee EXCO Members(per meeting) (per meeting) (per month)Chairperson N$3 770 Chairperson N$3 390 N$1 250 Trustees N$2 630 Trustees N$2 370 Travel N$3.50/km

The PO further informed the meeting that there was a query from a member regarding conflictof interestforTrusteesservingontheBoard.ThePrincipalOfficerconfirmedthat all Trustees complete a declaration of interest form annually that is submitted to NAMFISAandthatanypossibleconflictofinterestisdeclaredateveryTrusteemeeting.

9. RATIFICATION OF AUDITORS The Chairperson informed the meeting that the Fund underwent an open tender process and that EY is recommended to be appointed for a second term based on favourable costingandcontinuityofservices.ThemeetingratifiedtheappointedofEYforanotherthree years.

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10. ELECTION OF TRUSTEES Members voted on a ballot paper for their choice from the nominated candidates. EY audited the process and the proxies. The following members were elected as Trustees from 2015 – 2018:

Alfeus Benjamin Rachel CoomerRevival DoësesReginald IzaksGerson KamatukaDaniel LouwVeston MalangoHendrik MuisoorPinehas MutotaThinus Smit

11. OTHER MATTERS

Member Questions

Mr. Brian Hollick enquired whether any statistics are available that show how many members use the incorrect self-medication and subsequently do not get well and need further medication or to visit a doctor. NS responded that unfortunately the diagnosis is not captured and therefore the information is not available. The PO informed the meeting that the top tenmedicines claimed under the self-medication benefit 2014wereCoryx,Adcodol,EfferfluImmuneBooster,Genpayne,Ibupain,Cataflam,Acc200,EfferflyCColdandFlu,CoryxandAndolexC.

Mrs. Atousa Fischer-Buder informed the meeting that she is representing other members and attending the meeting on their behalf. Mrs Fisher-Buder mentioned that many members get medication from a pharmacy when they are ill, but do not get better.Sheurgedmemberstoseeadoctorfirsttoensurethattheyreceiveacorrectprescription. Mrs. Fisher-Buder queried whether self-medication claims are paid faster to pharmacies than other claims.

Mr. Nick Nel responded that all pharmacy claims follow the same process and that preference is not given to self-medication claims. Mrs. Fisher-Bud further queried why the pharmacists do not refer patients to the Doctor for a prescription. The PO responded that she will provide the contact details of the Pharmaceutical Council to the member. Mrs. Fisher-Buder furthermore requested that the Fund ensure that Client Service employees are properly trained with the correct information as she is of the opinion that the incorrect information is sometimes relayed to members.

Ms Mercy Stephanus informed the meeting that as a younger member she only utilises her self-medication benefit and as the benefit booster has now been removed herself-medication is depleted much earlier in the year which forces her to see a general practitioner for a prescription when she could have made use of her self-medication benefit.TheChairpersonrespondedthattheTrusteeswill lookintothemattertoseehow it can be addressed.

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AmembernotifiedthemeetingthatsheisonSapphireandshedoesnotbelievethattheself-medicationbenefitissufficientforherandherentirefamily.TheActuaryrespondedthat members also have a duty to utilise the self-medication responsibly. He further mentionedthat theself-medicationbenefitcouldbe increasedsubstantially,but thatthis will have a substantial impact on the increase of the member contributions.

Another member mentioned that his colleagues are also displeased with the self-medicationthathasbeenremovedfromthebenefitbooster.Hefurtherqueriedwhetheracute medication and doctors consultations have increased following the decision to removetheself-medicationfromthebenefitbooster.TheActuarymentionedthatthiswasoneof thepossible riskareas thatwere identifiedand that thesituationwillbemonitoredtoseehowifthisisthecase.Hedidmentionhoweverthatitisverydifficultto determine whether an increase in acute medication and doctors consultations would beduetothechangeinbenefit.

Ms. Monja Tjongarero informed the meeting that their employer group had recently moved from NHP to NMC and it would seem that co-payments on NMC are much higher than on NHP. She requested that the Fund investigate the correlation between the Funds in terms of co-payments.

Mr. Derick Briers enquired whether an increase in membership should equal lesser administration expenses. He notified themeeting that administration expenses hadgrownfromN$80toN$91millionwhichconstitutesa14%increasewhilstmembershiphasgrownby9%.TheActuaryinformedthemeetingthattheadministrationfeesarecalculated on a sliding scale in that the more member are administered, the less the Fund pays for administration fees per member.

Mr. Brian Hollick enquired whether the Fund is relying more on investment income and whether the Fund is getting a far smaller margin. He further enquired whether this is due to the Fund taking on high risk members. The Actuary responded that the Fund aims at usingasmuchofthepremiumstopaybenefitsaspossibleandtogettheunderwritingresult as close as possible to zero and to use the investment income to build reserves.

The Actuary further informed the meeting that the matter of membership of a desirable age and health is under regular discussion and the Fund is putting initiatives in place to address the concern.

12. CLOSURE The Chairperson thanked all present for attending the meeting and adjourned the meeting at 14h08.

These minutes thus accepted and approved with/without changes at the Annual General Meeting of 30 June 2016.

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d) Chairperson’s Report

1.4 Chairpersons Report and Administrators Report

2015 marked the end of the tenure for some of NMC Board of Trustees that served the fund for a number of years.The members thanked them for their positive contributions.

A transparent election/re-election of a new board took place at the 2015 AGM. The new leadershiphas takenup the taskwithgreat resolute,with theassistanceof theofficeof thePrincipalOfficer.The2015-2018TrusteescontinuetoeducatethemselvesabouttheindustryinordertoensuretheyeffectivelyexecutethetaskasentrustedtothemforthebenefitofalltheNMC members.

The fund delivered a solid performance in a tough operating and economic environment. The depreciation of the Namibian dollar to the other currencies, slow economic performance of the Namibian economy and the regulation /control of Angolan currency flow into Namibiaconstrained some of the growth. The stable political environment that was created by the stable leadership of the Namibian government contributed positively to the growth that was reported for the year under review.

The past couple of years have seen a steady rise in claims and the trend continued in 2015. NMC as a fund paid a total of N$1 061 582 000 through claim payments to the members of medical serviceproviders.Effortsbythe industrytofindpossiblesolutionstocounterthe increase inclaims continued throughout the year. The Trustees and Management put emphasis on the controllable expenses with renegotiations with suppliers to ensure good return on money paid for services.

NMCcontinuestoshowsignificantgrowthinmembershipandreported29542mainmembersand a combined total membership of 66 732(main members and dependants) for the year under review. Thus, the Fund remained the largest open Medical Aid Fund in Namibia.

Reservelevelsreportedat31Decemberwasat29.2%,aMembershipgrowthof9%fortheyear 2015 was achieved.

Added Benefits–Ourexcellentaddedbenefitshavecontinuedtoaddvaluetothelivesofour members. These benefits include the comprehensive Wellness programme, emergencyevacuation, premium waiver in case the principal member passes away, the additional hospital benefit, our lenient ex gratia policy, the HIV/AIDS programme, international medical travelinsurance and gym rebates.

Financials – The Fund reported a net surplus of N$42 million mainly to the investment returns by Namibia Asset Managers and Sanlam Namibia.

Corporate Social Responsibility-NMCcontinuedtosupportMisterSister,anotforprofitentity, that delivers mobile primary healthcare services to people living in rural areas of Namibia. NMC makes a monthly contribution to this worthy cause.

The Financial assistance trust that receives funds from NMC and Methealth enabled 12 medical and pharmaceutical students to continue with their studies for 2015.

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Walk for Wishes raised N$31,950, NMC matched the amount to the grand total N$63,900. All proceeds from the walk went to the Nampharm Foundation for facial reconstructive surgery in November for Shange Nghihepo and Michael Kristof—born with unilateral cleft lips and palates during.

In Closing - On behalf of the Board of Trustees I wish to thank the following: •Ourloyalmembersfortheirsupportandencouragement. • OurPrincipalOfficerandherofficefortheirdedicationandhardwork. • TheHealthProfessionalsfortheircommitmentintakingcareofourmembers. • TheMethealthNamibiaAdministrators, i3 Actuaries, Namasset and Sanlam Investment managers and NMG consultants for their contribution to the Fund.

Thinus SmitChairperson, NMC

e) Administrator’s Report 2015 Methealth Namibia Administrators takes pride in providing administration services to the largest open medical aid fund in Namibia, NMC.

Members can be assured of our continued excellent service delivery. At Methealth Namibia Administrators we believe that we are the best at what we do. We look forward to providing cost effectiveandinnovativesolutionstoachangingenvironment.ThisisinlinewiththevisionoftheTrusteestoensureacompetitiveofferingwhilstensuringthelongtermsustainabilityoftheFund.

WetakethisopportunitytothanktheNMCBoardofTrusteesandthePrincipalOfficerfortheirconfidenceandguidance,aswellasall stakeholders,membersandhealthprofessionals fortheir valued support. Theo OppermanMD, Methealth Namibia Administrators

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T: +264 (0)81 124 0217

E: [email protected]

W: www.i3actuaries.com

1st Floor Cnr. Feld & Jan Jonker Roads

P.O. Box 80560 Olympia,

Windhoek, Namibia

Directors: N Smit, K Crous

SAND CITY INVESTMENTS FIFTY (PTY) LTD

Registration Number: 2014/0017

15 June 2015

Alison Begley

Principal Officer

Namibia Medical Care

Actuarial Report for 2015 Annual General Meeting

This report will provide information on various aspects of the financial performance of Namibia

Medical Care over the past year.

1. Financial Performance

The Namibia Medical Care Fund (“NMC” or “the Fund”) ended 2014 in a healthy and satisfactory

financial position.

The current financial goal of the Trustees of NMC is to maintain the Solvency Ratio at close to 30%.

The Trustees believe that at this level of solvency, the Fund will be able to withstand all likely

financial shocks without endangering the ability of the Fund to pay all valid claims as they fall due.

It is also not desirable for the Fund to build up excessive reserves as this will have a negative impact

on the value of money its members receive. The regulatory minimum guideline is to have a Solvency

Ratio of 25%.

At the end of 2014, the Solvency Ratio of NMC was equal to 30.1%. This is the fourth consecutive

year that the Fund has managed to maintain a Solvency Level very close to the target. The Fund

generated a surplus from its operations amounting to N$15.6 million before the addition of

investment returns.

The investment strategy is designed to deliver stable returns in excess of medical inflation. The

strategy delivered on its goals over 2014 and generated an additional N$27.2 million in net

investment returns.

All the options of NMC managed to deliver a positive financial result over 2014. In our view this is

an indicator of a financially healthy fund. The financial performance of each option is analysed an

monitored on a continuous basis and the aim is to ensure a consistent performance across all

options as this will avoid cross-subsidies between options and will allow the Fund to implement

similar increases for all the options which in turn, reduces the risk profile of the Fund.

T: +264 (0)61 300 358





Windhoek, Namibia




10 June 2016

Alison Begley

Principal Officer







financial position.






Ratio of 25%.

At the end of 2015, the Solvency Ratio of NMC was equal to 29.2%. This is the fifth consecutive

year that the Fund has managed to maintain a Solvency Level very close to the target. The Solvency

Ratio has reduced by 0.9% since 2014 despite the Fund generating a surplus from its operations

amounting to N$25.0 million before the addition of investment returns.

The investment strategy is designed to deliver stable returns in excess of medical inflation. Even

though the strategy delivered lower than expected returns due to the adverse investment market

returns, the Fund still managed to generate an additional N$17.1 million in net investment returns.

The Fund generated a total surplus of N$42.1 million over the year. The main reason for the

reduction in the Solvency Ratio was the increase in the membership as discussed below in section 2.

All the options of NMC managed to deliver a satisfactory financial result over 2015. In our view

this is an indicator of a financially healthy fund. The financial performance of each option is analysed

and monitored on a continuous basis and the aim is to ensure a consistent performance across all



f) Executive Review by the Actuary

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T: +264 (0)81 124 0217





Windhoek, Namibia




15 June 2015

Alison Begley

Principal Officer







financial position.






Ratio of 25%.




investment returns.



investment returns.






2. Membership

The Fund continued to attract new members over the course of 2015. The total number of members

increased from 27 093 at the end of 2014 to 29 542 at the end of 2015. This represents an increase

of 9.0% over the year. The membership growth was spread across all the options with the Ruby

option showing the highest level of membership growth.

It is considered to be beneficial to a medical fund if it can attract new members and consistently

increase its total membership size every year as this would generally avoid the situation whereby,

on average, the members of the Fund would grow older every year. The membership growth does

however place pressure on the Solvency Ratio of the Fund and it places pressure on the Fund to

ensure that the new members that it attracts, are relatively younger and healthy members. This will

keep the risk pool healthy and thereby benefit all the members of the Fund.

3. Contributions and Benefits

The contributions and benefits of all the options offered by NMC is reviewed on an annual basis.

This is done to ensure that the benefits remain relevant and competitive and to allow for the impact

of the annual medical tariff adjustments (also called medical inflation).

The change in the contribution tables for each option is driven by three main factors. These are

the annual tariff adjustments, the increase in utilisation (members tend to use the services more

often and this includes the impact of newer and more expensive treatments and medicines) and

then the increase due to benefit changes and allocations to the reserves. These three factors are

different for each option, but on average for the fund, these values were as follows for the last year:

Tariff Adjustments 5.99%

Utilisation Adjustments 1.00%

Benefits and Allocation to Reserves 1.51%

The total average increase amounted to 8.50%

Most of the benefit limits were improved for the 2015 benefit year to ensure that the limits keep

track with the increasing cost driven by the increase in the tariffs. The limits for self-medication

were increased by 20% and the limits for the auxiliary services (Biokinetics, Psychology, Social

Workers and Physiotherapy) were increased by up to 25% for most of the options.

The overall limits on the Topaz and Topaz Plus options were also increased significantly.

4. Outlook

We expect that the Fund will maintain its strong financial position in the near future and it is

expected to be able to withstand all likely financial and other risks to which it is exposed. The

membership growth has been very good over the first few months of the year and the claims

experience is broadly in line with expectation at this stage.

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T: +264 (0)81 124 0217





Windhoek, Namibia




15 June 2015

Alison Begley

Principal Officer







financial position.






Ratio of 25%.




investment returns.



investment returns.






In the absence of any other adverse events, we expect that the contribution increases will broadly

follow the increase in the medical tariffs for the 2017 year.

Yours sincerely

Nico Smit

B.Comm | FASSA | FSAN

In my capacity as an Actuary

For and on behalf of i3 Actuaries and Consultants

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g) Performance of the FundSTATEMENT OF COMPREHENSIVE INCOME

For the year ended 2015 2014 N$’000 N$’000Net Contribution Income 1 095 335 922 084Net Healthcare Expenditure (970 790) (815 070)Gross Healthcare Result 124 545 107 014Administration Expenses (99 816) (91 591)Net Healthcare Result 24 729 15 423Net Investment Income 20 124 29 917Asset Management Fees (2 772) (2 465)Net surplus for the year 42 081 42 875

STATEMENT OF FINANCIAL POSITION

At 31 December 2015 2014 N$’000 N$’000AssetsNon-Current Assets 58 882 47 417Current Assets 381 085 334 346Total Assets 439 967 381 763 Equity and Liabilities Member’s Funds 319 415 277 33Non-Current Liabilities - -Current Liabilities 120 552 104 429Total Equity and Liabilities 439 967 381 763 Reserve Level (Members’fund/Netcontributions) 29% 30%

Solvency Ratio (Totalassets/Netclaims) 45% 47%

h) Membership StatisticsFINANCIAL YEAR 2015 2014Total Membership as at 31 December 66 732 61 437Principal Members 28 142 26 023Pensioners 1 400 1 070Dependents 37 190 34 344Average Number of Members 64 871 60 083Member to Dependant ratio 1:1.26 1:1.27Member to Pensioner ratio 1:0.05 1:0.04Average Age of Members 40.94 40.1

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i) Trustee Fees

Industry Trustee Remuneration Fees 2016

Open Fund 1 NMC Open Fund 2 Open Fund 3Board meetings:

Chairman N$ 3 810.00 N$ 3 960.00 N$ 3 938.28 N$ 3 724.00Vice chairman N$ 2 830.00 N$ 3 360.00 N$ 3 180.59 N$ 2 980.00Other Trustees N$ 2 830.00 N$ 2 760.00 N$ 2 833.35 N$ 2 561.00 Traveling N$ 4.50/km N$ 3.50/km N$ 3.50/km N$ 4.25/km

Subcommittee meetings:Chairman N$ 3 810.00 N$ 3 560.00 N$ 3 545.96 N$ 3 724.00Vice chairman N$ 2 830.00 N$ 3 025.00 N$ 2 365.68 N$ 2 980.00Other trustees N$ 2 830.00 N$ 2 490.00 N$ 2 365.68 N$ 2 561.00

Other Ad-Hoc meetings Convener N$ 3 810.00 N$ 3 560.00 N$ 3 545.96 N$ 2 980.00Other trustees N$ 2 830.00 N$ 2 490.00 N$ 2 365.68 N$ 2 374.00

Exco meetings:Chairman N$ 3 810.00 N$ 3 560.00 N$ 3 938.28 N$ 2 980.00Vice chairman N$ 2 830.00 N$ 3 025.00 N$ 3 180.59 N$ 2 374.00Other trustees N$ 2 830.00 N$ 2 490.00 N$ 2 833.35 N$ 2 374.00Monthly Retainer N$ 1 840.00 N$ 1 310.00 No retainer No retainer monthly retainer monthly retainer

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Notes:

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Notes:

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2016 agm annual general - my · 1.9 other matters ts 1.10closing ts b) nmc board of...

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