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Inquiry into claims of medical scheme racial profiling

The Council for Medical Schemes (CMS), along with various doctor associations and the Board of Healthcare Funders, has instituted an inquiry into allegations of discrimination and racial profiling by certain medical aid schemes. The Sunday Independent reports that the inquiry will start in a week and will take a period of four months after which a provisional report will be issued.

Medscheme has, meanwhile, welcomed the investigation. South Africa’s second largest medical aid administrator said in an IoL report that the probe would help debunk the allegations that black and Indian practitioners were being "harassed, exploited, and their claims withheld because of their race and ethnic background".


Chair of the National Health Care Professionals Association (NHCPA), Dr DonaldGumede said the probe was long overdue. “We say no to vigilantism by anybody. It doesn’t matter who you are, or whether your pockets are deep, or whether you are black, red, white. “We say yes to the rule of law, everybody should be equal before the law. It should not depend on your socio-economic status or the colour of your skin and we condemn severely coercion and extortion of health-care professionals by the schemes,” he said.

Gumede said where there was wrongdoing and fraud, lawful channels should be followed to address the issue and the matter reported to relevant authorities.

President of the Health Professions Council of SA (HPCSA), Dr Kgosi Letlape, was scathing in his response. The report says he slammed the “culture of vigilantism” and what he described as “de-professionalisation” of practitioners. “One of our major concerns is that the working environment public and private is not conducive to ethical behaviour from health-care practitioner, Letlape said.

“We have seen major changes to the Medical Schemes Act that are lawful but a lot of them will not pass the mastery of ethics. The preferred provider system is an unethical system because it is not equitable, it has preferential treatment, it violates the rights of the patient for choice of a practitioner so there are fundamental basic ethics that it violates and we have always asked the funders why they don’t set the terms and conditions and any practitioner that is prepared to meet those terms and conditions should be allowed to see patients under those terms and conditions.”

The report says he also slammed the practice of withholding payments from doctors. “The second issue that promotes unethical behaviour is that you provide services as a professional and you are not sure that you are going to be paid. And you are now in a situation where when a funder pays you they have no obligation to pay you, they are doing you a favour,” he said.

The Health Funders Association’s (HFA) Lerato Mosia said: “It’s a pity and very unfortunate that we have got to a point like this today, where it almost seems like it has really got out of hand. However, we are positive as HFA that a process that we have embarked on starting this year is going to bring good outcomes to this situation.”

Mosia says they are fully behind the CMS in finding a solution. “It is a crisis that we are facing on fraud, waste and abuse as a country, one that has got dire consequences for everybody and eventually obviously for the country as a whole, one thing we do need to do is to acknowledge that there should come a time that we sit and discuss this to the fullest degree,” she said.

Meanwhile, the report says, the SA Medical Association (Sama) welcomed the probe and said the investigation must be conducted without favour or bias. “Sama will not comment on any racial issues because we cannot prove it currently. But if it is proven we will comment on that,” said Sama chair Dr Angelique Coetzee.

BHF and Healthcare Forensic Management Unit’s Dr Hleli Nhlapo denied allegations of racial profiling. “I must say it upfront, in the constituency of BHF I don’t know of anyone who uses race to discriminate against claims. What we use in the industry is the PCNS number,” he is quoted in the report as saying.


Medical health practitioners accused medical aids of racial discrimination on eNCA’s Tonight with Jane Dutton. The Citizen reports that companies accused include Discovery, Medscheme Medical Aid, and the Government Employees Medical Scheme (GEMS).

CEO at the CMS Dr Sipho Kabane is quoted as saying the list of allegations includes “racial profiling, blacklisting of doctors, keeping a list of health professionals, spy cameras, coercion, (and) bullying”.

NHCPA's Gumede, said he had “evidence” to back up these claims and added that the organisation believed black, Indian, and coloured medical practitioners had been unfairly discriminated against.

A clinical social worker, Nomaefese Gatsheni said that Discovery attempted to make her disclose confidential patient information. “I get audited every two years, and normally the medical aid, which is Discovery on my side, they will demand the confidentiality of my patients, the minute I refuse to give them the confidentiality of the patient, then I’m told ‘ok, if you don’t agree with that we’re gonna pay the patient and they will pay you’. Guess what happens, now a patient will receive the money and don’t pay me. I’ve been struggling with that for over two years,” she said.

“Medical schemes and administrators do have a responsibility of making sure that the funds which have been contributed by members are not illegally claimed, so there are certain measures that they are allowed by the act to make sure they verify the claims and make sure they are legitimate,” said Kabane.


The ANC intends to lodge a formal complaint with the South African Human Rights Commission (SAHRC) to investigate the allegations. The Citizen reports that a group of black and Indian private medical practitioners have come out alleging that they are being unfairly treated by medical aid schemes, based on the colour of their skin and their ethnicity.

They claim to have received payment challenges from various medical aid schemes. They also allege that there is a national list with names of black and Indian practitioners from across the country that has been circulated among medical aid schemes, and that the names on the list are often exploitatively targeted.

The report quotes the ANC as saying that the allegation undermines the essence of the constitutional imperative of building a non-racial South Africa, and called on the human rights commission to intervene. “If medical aid schemes are indeed found to be guilty of such discrimination, the ANC will pursue the relevant legal and legislative process to ensure that the practice is immediately stopped, and that those responsible face the full might of the law. The ANC will not tolerate any form of racial discrimination.

“The ANC will continue to mobilise and engage a wide range of stakeholders in the healthcare sector to ensure its transformation and strengthen its ability to provide quality health-care in the context of the National Health Insurance Scheme (NHI).

“The Gauteng ANC views the alleged misconduct as concerning, as it has the possibility of crippling practices across the country, rendering healthcare professionals incapable of providing quality healthcare.”


Discovery Health responded to the claims by dismissing the allegations, saying the company is against any discrimination against healthcare professionals, reports eNCA.


Medscheme has, meanwhile, welcomed the investigation. South Africa’s second largest medical aid administrator said in an IoL report that the probe would help debunk the allegations that black and Indian practitioners were being "harassed, exploited, and their claims withheld because of their race and ethnic background".

“We welcome the investigation. For us, this is an opportunity to prove that we do not profile providers based on race. We rely on whistle-blowers and our own predictive analytics system, which relies solely on the practice number of a healthcare provider. We do not keep race demographics of medical practitioners,” Medscheme CEO Anthony Pedersen said.

"The NHPCA has previously brought a High Court application against Medscheme and other schemes, including CMS, requesting the court to declare its forensic methods as unlawful. The court dismissed their case and questioned how this organisation is constituted.

“A medical scheme has a fiduciary duty to protect the funds of their members and they cannot be required to continue honouring claims when the validity is in question, a medical scheme does not require a court judgment to recover overpaid funds, specifically because the claims have already been paid in good faith,” Pedersen said.

“We pay claims in good faith. We reserve the right to retrospectively review payments based on anomalous patterns. We pay over 80% of claims within hours, with no recourse, as they are confirmed to be legitimate,” he said.

The report says on allegations of bullying tactics, Medscheme, a subsidiary of AfroCentric Group, categorically refuted that any such tactics were used in their forensic investigation process. Information was requested where it was needed and a provider was given the opportunity to respond. "When we do invite providers for interviews, we encourage them to have legal representation. We do not use hidden spy cameras or fake membership cards to entrap a suspect under investigation. One way to verify that valid services were indeed rendered, is to ask a practitioner to provide information as proof that he or she actually treated the member. We are not interested in the confidential notes of a practitioner. This right to access such records is protected by law, including the National Health Act and various other rules governing medical schemes and healthcare practitioners," Pedersen said.

The report says he dismissed the excuse of patient confidentiality when doctors were asked to back their claims. When a claim was submitted the doctor submitted codes detailing the diagnosis. Motivation for pre-authorisation contained very detailed clinical information about the surgery and/or treatment required by the member.

“We know when the member is in hospital, or what chronic medication they require, or what their specific managed care program is. By law, we are expected to pay claims within 30 days. This is done in almost 100 percent of claims submitted. Medscheme only withholds payment pending finalisation of the audit and we try to finalise all cases within 30 days.

"Only if there is a delay on the cooperation by the healthcare provider can payment to their practice be delayed further than that. Only 3% of providers have been investigated in 2018,” Pedersen said.

The report says according to the BHF, at least 10% to 15% of all medical aid claims were fraudulent, abusive, or wasteful in nature, a substantial expense in a R150bn industry. The total fraud costs in the South African private healthcare system was estimated at about R22bn a year.

[link url=""]Sunday Independent report[/link]
[link url=""]The Citizen report[/link]
[link url=""]The Citizen report[/link]
[link url=""]eNCA report[/link]
[link url=""]IoL report[/link]

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