The medical schemes at the centre of the alleged racial bias controversy have denied any discrimination and rejected allegations of fraud or criminal conduct, reports Daily Maverick, after ActionSA MP Dr Kgosi Letlape lodged criminal complaints against them on Monday.
The complaints against Discovery, Medscheme and the Government Employees Medical Scheme (GEMS) alleged that serious incidents of fraud and intimidation had taken place at the companies over several years.
Letlape, a member of the parliamentary Portfolio Committee on Health who served as President of the Health Professions Council of South Africa (HPCSA) between 2015 and 2021, filed the complaints after the recent release of the Section 59 Final Investigation Report, which found that between 2012 and 2019 there was evidence that fraud, waste and abuse (FWA) systems used by medical schemes showed racial discrimination against black service providers.
The complaints were lodged at Lyttelton Police Station in Centurion, and Lt Colonel Mavela Masondo, spokesperson for the SAPS in Gauteng, confirmed the case would be transferred to the Directorate for Priority Crime Investigation (Hawks) for further investigation.
The section 59 report noted that the investigative panel was not a judicial body and did not make legal findings about unfair discrimination in terms of section 9 of the Constitution or the Promotion of Equality and Prevention of Unfair Discrimination Act.
However, it did make a “factual finding that the evidence of the risk ratios before us shows racial discrimination against black service providers by the (medical) schemes”.
Patterns of behaviour
According to ActionSA, Letlape’s tenure as HPCSA president as well as his roles as chair of the council’s Preliminary Committee of Inquiry and chair of the Medical and Dental Board, exposed him to information that informed the criminal complaints.
During this period Letlape was “privy to various investigations and disciplinary proceedings involving conduct by medical aid schemes that may have crossed into criminality”, said ActionSA.
“The patterns of behaviour uncovered by the … investigation, coupled with his own exposure … point to a deeply rooted culture of impunity that demands comprehensive criminal scrutiny.”
Operating within the law
GEMS said it was aware of the public statement by ActionSA and Letlape about the intention to lay criminal charges, but it had not been formally served with any charges or related documentation, meaning it was unable to comment on the specifics of the allegations.
“GEMS firmly rejects any suggestion of fraud or corruption. The scheme operates within a lawful, strict governance and regulatory framework, including oversight by the Council for Medical Schemes. GEMS upholds the principles of ethical conduct, fair treatment and good governance in all aspects of its operations. These systems are continuously updated to prevent disparate outcomes and to improve transparency across all engagements with healthcare providers,” it said.
“Should a formal SAPS investigation be initiated, GEMS will fully co-operate through all appropriate legal and regulatory channels. We will also seek to understand the legal basis for the charges, given that GEMS has not been found to have acted with racist intent, fraudulently, or in contravention of any legislation.”
It said it welcomed the Section 59 Final Investigation Report and acknowledged the systemic concerns raised. However, it noted that the report said “GEMS was not found to have acted with racist intent”.
Dr Ron Whelan, CEO of Discovery Health, said the company had not received any information regarding the alleged complaint lodged by ActionSA and was unable to comment on it. However, he noted that Discovery Health “strongly rejects the reported findings … and is deeply concerned about the reliability and presentation of the analysis”.
“It is factually incorrect that the Section 59 Investigation Panel made a finding of unfair discrimination and racial profiling against Discovery Health. Neither the interim report nor the final report makes this claim. The panel conducted a thorough review of Discovery Health’s forensic processes and found no evidence of unfair discrimination or racial profiling,” he said.
“The panel further stated that the analysis conducted by the expert witness did not support a scientifically certain conclusion and confirmed that the report is not legally binding. The report therefore provides no basis for legal action.”
Representatives of medical schemes, including the Board of Healthcare Funders and the Health Funders Association (HFA), have also objected to the findings in the report.
The HFA said that the evidence presented to the investigative panel by medical schemes showed that “many, if not all, of the healthcare practitioners that submitted complaints about racial bias to the panel were actually guilty of fraudulent activity against medical schemes”.
“The panel made no finding that these individuals should not have been investigated. Nor did it find that medical schemes acted improperly by recovering funds,” said the HFA.
“Medical schemes are legally and ethically bound to protect their members and their members’ funds against fraud, waste and abuse in healthcare.”
See more from MedicalBrief archives:
Top medical aid schemes guilty of racial bias, inquiry finds
5 years on, no report on medical schemes’ racial bias inquiry
Discovery rebuttal of racial bias in fraud investigations
Medical schemes’ algorithms under scrunity after racial profiling findings