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Unpacking ethical behaviour and solutions to rooting out fraud, waste and abuse in the healthcare industry

17 November 2021 The Board of Healthcare Funders (BHF)
Dr Katlego Mothudi, Managing Director of the BHF

Dr Katlego Mothudi, Managing Director of the BHF

Fraud, waste and abuse is a cancer that needs to be cut out of the healthcare industry, the Board of Healthcare Funders (BHF) heard during a dialogue on the issue.

Healthcare leaders participating in the BHF dialogue recently held agreed that this could be achieved by prioritising patients, implementing ethical behaviour, and through the use of technology.

Fraud, waste and abuse (FWA) is a contentious issue in South Africa, as evidenced by the ongoing debate on the interpretation of section 59 of the Medical Schemes Act, highlighted during the CMS-led Section 59 investigation as well as through the recently launched court process, with papers served on medical schemes challenging the constitutionality of section 59 (3) of the Act. This section of the Act deals with deductions of claimed losses from money owed to health practitioners for services provided to the scheme’s members.

However, BHF is of the view that this could have unintended consequences.

According to a legal opinion from the BHF, the reversal of claims is a norm in the industry and there is nothing unlawful about it, it simply allows a medical scheme to recover money that it has paid in error.

“If section 59(3) is declared unconstitutional, then medical schemes would have to take longer than 30 days to process claims. The level of scrutiny would have to be increased dramatically in advance, even for non-problematic claims,” the legal review opined.

“It would be catastrophic if medical schemes could not reverse claims paid out accidently. This would also make the administration process for medical schemes very difficult.”

While litigation is never pleasant, and is costly, it gives schemes the opportunity to defend themselves against such cases.

“Medical schemes should see this court case as an opportunity to explain how they work and to defend themselves against these allegations,” the opinion explained.

The opinion is also of the view that the issue of ethics is not clear cut.
According to Dr Katlego Mothudi, Managing Director, BHF, there is power in collaboration. It can play an important role in exposing FWA in the healthcare sector.

Dr Mothudi gave an account of an investigation the BHF is participating in in collaboration with the Special Investigations Unit (SIU) as part of the Health Sector Anti-Corruption Forum (HSACF). The matter involves allegations of FWA against the Pretoria Eye Institute, sparked by a whistleblower report citing gross misconduct by the institution.

The main allegations against the facility include submission of claims for services that were not rendered, fraudulent billing of medical schemes, and the use of practice numbers registered for another facility. Entities participating in the investigation include the BHF, the Directorate for Priority Crime Investigation (DPCI), the South African Revenue Service (SARS) and the Health Professions Council of South Africa (HPCSA).

The HSACF was set up by the Special Investigating Unit (SIU) to combat FWA in the Health Sector and is coordinated by a steering committee made up of various state and private sector entities. When whistleblowers submit allegations of fraud and corruption, the HSACF engages the relevant stakeholders to investigate the allegations, Mothudi explained.

“The unfortunate reality is that money that is lost through FWA is that which is meant for patients and for treatment of diseases,” he said.

Josua Joubert, CEO and Principal Officer of CompCare Medical Scheme and Deputy Chairperson of the BHF, was quick to point out that not all providers are unethical. “Although incidences of fraud do occur, it is important to point out that not every provider is bad or trying to rob the system. Most providers are ethical, and this should be recognised,” said Joubert.

Mothudi’s overarching message was about collaboration and health sector partners exchanging ideas on how to better approach and deal with FWA.

The utilisation of big data and technology was also highlighted as an effective tool for FWA investigations.

According to Jan Bezuidenhout, founder and data scientist at RiskCede, through machine learning big data allows the industry to separate large transactions or claims and determine which are fraudulent and which are legitimate.

“Machine learning is a collection of algorithms used to learn from large amounts of data using various models. The machine is essentially learning how to make predictions using supervised learning, big data, and the results of what happened in cases where fraud was detected or where claims were legitimate," Bezuidenhout explained.

Big data analytic models in the FWA area produce both false positive and false negative results. When assessing false positive results consideration is given to the cost of further investigation of the false positive result, as well as potential reputational harm. It is worth noting that investigating false positives is an expensive process.

When assessing false negatives one looks at the cost of continued losses due to FWA, which can be worse than a false positive. An example is paying out a claim that was not supposed to be paid. The cost of false negatives may be quite high. When we calibrate this analytic model, we look at both false negatives and false positives and determine the optimal model results.

The BHF has already gathered this big data and put it to good use. “The BHF has collected scheme data and shared it with the community, and it has also collected data on Covid-19 treatment and shared it.”

Vishal Brijlal, Executive Director of the Clinton Health Access Initiative, pointed out that certain decisions providers make, knowingly or unknowingly, could result in FWA.

“A major topic of discussion in the past has been the Prescribed Minimum Benefits (PMB) in relation to providers diagnosing depression and bipolar disorder. The professional’s attitude was to protect the patient financially by diagnosing depression rather than bipolar disorder simply because depression was a prescribed minimum benefit,” he explained.

According to Brijlal, putting the patient first and acting ethically are essential components of providing quality care. “My definition of ethical behaviour is health-seeking behaviour combined with clinicians responding to patients’ demands without bending the rules,” he concluded.

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QUESTION

The second draft amendments to Regulation 28 will allow retirement funds to allocate up to 45% of their assets to SA infrastructure, with a further 10% for rest of Africa; but the equity & offshore caps remain unchanged. What are your thoughts on the proposal?

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Infrastructure? You mean cash returns with higher risk!?!
Infrastructure cap is way too high
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