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Re-appointed health minister Dr Aaron Motsoaledi has revealed, in an interview with Business Report, that private sector corruption in healthcare is about to come under investigation.
Investigations will focus on medical aid fraud, inflated prices for procedures and supplies, and the growing problem of fraudulent medico-legal or malpractice claims against the state – all of which drain the already burdened public healthcare system of funds which it sorely needs.
The proposed National Health Insurance (NHI) scheme may well be one of those drains, if the fears of many who have already voiced opposition to it are realised – but while making a strong case for the implementation of the NHI scheme in his latest budget vote, delivered on 17 July 2024, Motsoaledi said: “Let us discuss which areas need to be ironed out but let us not be obstacles to what poor people have been waiting for for close to a century.”
Meanwhile, Motsoaledi will also be focusing his attention on the goings-on in private healthcare.
“Are we saying corruption does not happen in the private sector? It is happening on both sides. It is up to us as South Africans how we get rid of it. I am told more than R228-billion is lost in the private sector,” he said in the interview.
Fraudulent claims
The minister has received information from the Health Sector Anti-Corruption Forum (HSACF) – of which Corruption Watch is a member – that fraudulent medico-legal claims are on the increase. The HSACF has had its eye on the private sector for some time, and in September 2023 it heard from the Special Investigating Unit (SIU) that claims in various provinces were under scrutiny, with billions of rands at stake.
The SIU, which chairs the HSACF, has numerous cases in its sights. These involve claimants whose existence could not be verified while there was no record of their stay at any hospitals, claims that were submitted on behalf of deceased patients – one of them a child – and a disturbing number of false birth injury claims.
“Another huge practice of corruption in the healthcare system is happening with lawyers and medico-legal litigation where huge amounts are paid out yearly that could help the healthcare system. Many believe it is the carelessness of the doctors but quite a large amount of it is fraud. We need the unit to look into that,” he said.
Motsoaledi told Business Report that he was also expecting an SIU report as part of an exercise to clean up the healthcare sector, and this would include incidents from the Covid-19 days.
Private health sector corruption
Medical corruption in the private sector was wide-ranging, he added. This includes concerns that more babies were delivered by caesarean section than natural birth, which was better for doctors in terms of their fees and their reduced need to attend to the patient.
Other types of fraud, said Botho Mhozya of Discovery Health in a recent interview with the Bhekisisa Centre for Health Journalism, include card farming, when a member of a medical aid scheme allows their friends or family to use their card to get medical care.
“Another one is ATMing. This is when members and a healthcare provider collude. The provider submits a claim to Discovery and then, on receipt of payment, the provider splits the funds with the member.”
Then there are the false claims, which have already been mentioned – “for services that were never delivered, and submitting claims that disguise services for cosmetic surgery [while] understanding that it’s an exclusion within the medical schemes. For example, [someone] submits a claim for an appendectomy, but meanwhile they’ve had liposuction [surgery to remove fat from your tummy, hips, thighs or buttocks].”
As if that wasn’t enough, added Mhozya, there are syndicates operating within the private healthcare system involving medical aid members and service providers. All of these illegal activities drive up the price of medical aid fees and siphon much-needed funds.
Subsidies for all
In his budget speech Motsoaledi explained that government subsidises private healthcare as well as the public health system.
“Any person in our country who is on a medical aid, regardless of who they work for, receives tax rebates from the South African Revenue Service. I am made to understand that these tax rebates amount to approximately R30-billion.”
In addition, he said, some 1.3-million public servants, plus all members of Parliament and legislatures, and all judges, are subsidised by the fiscus to the tune of R70-billion per year, in the medical schemes they have joined.
