The Section 59 Investigation Panel has found that three medical aid schemes, Discovery Healthcare, Medscheme and the Government Employees Medical Scheme (Gems) have unfairly discriminated against black medical practitioners for eight years.
The Council for Medical Schemes (CMS) launched the Section 59 investigation following a complaint laid by the members of the National Health Care Professionals Association (NHCPA) and Solutionist Thinkers that their members were being racially discriminated against by medical aid schemes and administrators.
The NHCPA claims that the unfair discrimination also led to medical aid schemes and administrators withholding payments to their members, which directly impacts on the bottomline of their members’ businesses. This claim was supported by the The Health Professions Council of South Africa (HPCSA).
During his testimony to the panel, HPCSA president Dr Tebogo Kgosietsile Letlape said that the mechanisms used by the schemes to address fraud, waste and abuse (FWA) only affect black providers because they are dependent on the direct payment from medical aids.
‘Black’ in this instance refers to African, coloured and Indian race groups.
“The people from affluent communities are not affected by these issues. They have, you know, tap machines, swipe machines. You pay before you are seen, or you pay before you leave. They don’t have creditors. They don’t send accounts. And they are not impacted by this behaviour of medical aids,” he said.
The panel found that between 2012 and 2019, black medical practitioners were 1.4 times more likely than those not identified as black to have been classified by the three medical aid schemes to have committed FWA, which amounts to unfair racial discrimination.
The interim report released on Tuesday found that Discovery was 35% more likely to identify black providers as having committed FWA, Gems 80% and Medscheme 330%.
Although there is no unilateral definition of FWA, the CMS defines “healthcare fraud” as knowingly submitting false claims, or the misrepresentation of the facts in order to get payment of a benefit to which one is not entitled. The CMS defines waste and abuse as claiming healthcare treatment and services that are not absolutely medically necessary.
One example of racial profiling provided to the panel by the NHCPA was a ‘Black List’, which is published by Gems. It is a list of providers that patients should no longer consult after being blacklisted for allegedly committing FWA.
Ninety-four percent of general practitioners and 100% of social workers blacklisted by Gems were black, according to the interim report.
Speaking at the release of the interim report on Tuesday, the panel’s chairperson Advocate Tembeka Ngcukaitobi said that during the public hearings which were held from July 2019 to January 2020 some medical practitioners had complained of “sheer intimidation” by medical schemes, which in turn forced the black medical practitioners to accede to the demands of the medical aid schemes.
The panel heard that during investigations of FWA, the medical practitioners would be given minimal communication regarding the status of the investigation.
“This left providers in a position where they were being asked for information without any context or explanation about what it was the scheme was seeking to verify…. This vagueness made it difficult for the providers to respond,”the report found.
Every scheme and administrator that was implicated in the complaints denied that there was unfair racial discrimination in their FWA investigation process.
The medical aid schemes and administrators based their contestation of the interim findings either on an automated system, underpinned by an algorithm, that flags outlier practices for investigation or tip-offs and whistleblowers.
The schemes and administrators argued that only practice numbers are known by the automated system and there is no assignment or identification of race either explicitly or implicitly in the system.
The panel however found that even though the medical aid schemes and administrators use automated systems, there is always an element of human intervention at some point along the chain of investigation and that “the systems are not fully automated and therefore the FWA outcomes are not a product of only machines or their programmers.”
The interim report was released on Tuesday after the Gauteng High Court ruled that the interdict to prevent the report from being released by Gems and the Healthcare Finders be struck off the roll.
The application by Gems and the Healthcare Funders was heard on Sunday, with the organisations arguing that they had not been given an opportunity to view and respond to allegations levelled against them in the report. The interim report should not be released to the public, the healthcare groups argued.
Parties have until March 1, 2020 to provide the panel with their views on the interim report before a final report is released.
Read the full report here