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Medscheme welcomes investigation into allegations of racial profiling against medical practitioners

20 May 2019 Medscheme

South Africa’s largest health risk management services provider, Medscheme, has welcomed an investigation into allegations of racial profiling against black and Indian private medical practitioners.

The second largest medical aid administrator said on Sunday the probe, launched by the regulator of medical aids schemes, the Council on Medical Schemes (CMS), would help debunk the allegations the allegations that black and Indian practitioners they 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,” said Anthony Pedersen, Chief Executive Officer of Medscheme.

The CMS review follows allegations made by members of the National Health Care Professionals Association (NHCPA) who said they had been unfairly treated and their claims withheld by medical aid schemes based on the colour of their skin and ethnicity.

Last Thursday, Medscheme attended a meeting convened by CMS. Other attendees included the NHCPA, Discovery, Sizwe Medical Scheme, Medshield, GEMS, South African Medical Association (SAMA), Health Funders Association (HFA), Board of Healthcare Funders (BHF) and Health Professions Council of South Africa (HPCSA).

The officials from all the organisations agreed to the scope and timelines of an investigation that the CMS will lead.

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,” adds Pedersen.

On allegations of bullying tactics, Medscheme, a subsidiary of AfroCentric Group, categorically refutes that any such tactics are used in their forensic investigation process. Information is request where it is needed and a provider is 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.

Pedersen adds that: “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 dismissed the excuse of patient confidentiality when doctors were asked to back their claims.
When a claim is submitted the doctor submits codes detailing the diagnosis. Motivation for pre-authorisation contains 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% of claims submitted. Medscheme only withholds payment pending finalisation of the audit and we try 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,” explains Pedersen.

According to the Board of Healthcare Funders, at least 10 to 15% of all medical aid claims are fraudulent, abusive or wasteful in nature, a substantial expense in a R150 billion industry.

The total fraud costs in the South African private healthcare system is estimated at approximately R22bn each year.

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