The Department of Correctional Services does not want convicted fraudster Schabir Shaik to be released early from prison on medical grounds.
But parliamentarians are divided on the issue, with some arguing that it is costly to keep Shaik in hospital for a long time.
Shaik was sentenced to 15 years imprisonment for fraud. He has another four years to serve before he qualifies for parole.
Shaik has spent the past six months at the Inkosi Luthuli Hospital in Durban after he suffered a mild stroke.
He has been diagnosed by his doctors as suffering from a chronically high blood pressure.
Prison doctors have recommended that Shaik be considered for medical parole.
Yesterday national prisons boss Vernie Petersen told MPs that a medical parole was not an option for Shaik or "any other chronically ill people".
He said the Correctional Services Act only provided for prisoners who are in the "final stages of a terminal illness" to be granted medical parole.
Petersen pointed out that Shaik was chronically ill rather than terminally ill.
He defended his department's decision to allow Shaik to spend the past six months in hospital, saying the state had "an obligation to get Shaik the appropriate medical treatment".
But KwaZulu-Natal prisons commissioner Nkosinathi Nhleko pointed out that it would cost an estimated R3million to keep him in hospital until he qualifies for parole.
"Will it make taxpayers happy if we keep Shaik in hospital for a total of seven years?" Nhleko asked.
Portfolio committee chairman Dennis Bloem seemed to support Shaik's parole application.
He said: "If the doctors say this person must go on medical parole, who is the department to refuse it?"
Bloem said it was unacceptable that any severely impaired person should languish in prison.