With the public health sector struggling to stay afloat under the weight of out-of-control, often fake, medical negligence cases, currently sitting at a combined R120bn across all provinces, government has initiated a forensic crackdown against the corruption and plans to introduce law amendments to reduce crippling bulk payouts, writes Medical Brief.
In a special Bhekisisa report, Christina Pitt writes that Special Investigating Unit (SIU) has a year to track down dodgy lawyers and patients who file fake medical negligence cases that cost the Health Department millions in payouts, while the State Liability Amendment Bill of 2018 plans to decrease how much responsibility the government must take for mistakes that happen at its facilities by limiting the size of medical negligence payouts (for claims of more than R1m).
If the Bill becomes law, victims of medical negligence will be paid in smaller batches instead of one big payout, something actuaries argue could make people too reliant on the government to follow through consistently.
Currently lawyers, patients and state officials are colluding to cash in on the crumbling health sector. There are numerous fake medical negligence claims for patients who don’t exist (or cases brought for real people with made-up stories), says Ronel van Zyl, a senior legal adviser for the South African Law Reform Commission (SALRC).
Another scenario involves millions of rands paid by the government for work that state attorneys never did, says Keith Bolton, the former head of paediatrics at the Rahima Moosa Mother and Child Hospital in Johannesburg.
Bolton has worked in the public sector for 40 years and given expert evidence for the state in medical negligence cases for much of that time. He was also a member of the ministerial advisory committee on medical litigation that developed a strategy to deal with the escalating medical negligence claims at the Health Department’s 2015 Medico-Legal Summit.
There have been cases, he says, where state attorneys have colluded with “patients” who make baseless malpractice claims, so that they can split the payout. In some instances government lawyers would deliberately not defend the case so that the settlement was bigger.
Bolton says bribes are frequently paid too: thousands of rands are offered to hospital administrative staff to steal or destroy medical records, because when a negligence case goes to court without the patient’s hospital file, the court regards this as medical negligence in itself.
There’s also something called “touting”, or “ambulance chasing” – when lawyers approach potential clients in person.
“I’ve heard stories about agents who single out women with disabled children in the cerebral palsy unit,” Bolton says. “They ask them: ‘How would you like R5m?’”
The tout (someone sent by a lawyer) will physically follow the patient and their file as it goes from one specialist to another. Then, before the administrators pack the file away in a box, the person offers them money for the original file.
Says Bolton: “Six months later, the hospital gets a court summons for a medical negligence case and we have no records.”
Why are medical claims for cerebral palsy so lucrative?
About half of all medical negligence cases in South Africa are for cerebral palsy. There’s little data on how many babies are born with this condition in SA, but in 2002, researchers for the South African Medical Journal found 10 in 1 000 children living with the disorder when they screened about 2 000 children in northern KwaZulu-Natal.
That’s five times higher than the international average overall, which is just more than two per 1 000 children, according to a review of 49 studies published in Developmental Medicine and Child Neurology in 2013.
Cerebral palsy cases make for lucrative settlement amounts if there’s a finding of medical negligence because the guilty party (read: in South Africa, mostly the state) often has to pay a settlement amount calculated based on the lifelong disability that cerebral palsy causes for someone.
That amount includes the cost of treatments a person had to get before going to court. But, according to the Actuarial Society of South Africa (Assa), the aspect that contributes the most to this hefty price tag is all the future costs like medical treatments, au pair salaries and the home care needed by someone with cerebral palsy. People who win medical negligence claims are also entitled to be paid for the money they would have been able to make, were they not disabled.
On average, claims in South Africa rack up about R5.5m per case, found a 2021 Assa report.
The SALRC says it’s the sheer size of the awards that draws lawyers to pursue claims against the state.
South Africa’s Contingency Fee Act (or the abuse of it) provides another incentive for attorneys to prowl state hospitals for cerebral palsy cases, the SALRC says, because it allows for something called “no win, no fee”. This means a lawyer’s clients only have to pay for their services if they win the case. But although this Act opens up legal services to people who wouldn’t otherwise be able to afford it, it also opens them up to abuse: lawyers may charge up to a maximum of 25% of the payout. There has been e speculation that some lawyers inflate their fees to 25% even if it doubles their normal fee.
Health departments littered with corrupt officials
Concocted or fake negligence claims are so common that in July, President Cyril Ramaphosa asked the Special Investigating Unit (SIU) to investigate all nine provinces and the national Health Department to uncover which government officials, lawyers or other people are defrauding the state.
SIU spokesperson Kaizer Kganyago told Bhekisisa that no further information regarding the corruption allegations can be made public as it is an ongoing investigation, but that the report should be completed within a year, when it will be sent to the President.
Some experts, however, say such investigations frequently don’t lead to any government action.
Alex van den Heever, an adjunct professor at the University of the Witwatersrand’s school of governance, says the SIU investigation will only be meaningful if its results are made public. “The report must be put in the public domain immediately, not through some political official who can decide what can be disclosed,” he says.
Kganyago says there’s shocking evidence of corruption in medical negligence cases brought against officials at provincial Health Departments. “There were previous investigations into maladministration at the office of the State Attorney in 2018 and 2019,” he says. “But the corruption was so bad we had to expand it to the provincial Health Departments.”
The cost of corruption – and overcrowded hospitals
Valerie Rennie, head of corporate affairs in the national Health Department, says these ploys put enormous pressure on the health sector’s coffers.
If none of the claims currently on the books for the 2020/2021 financial year is reduced, it will cost the country a combined R120bn across all nine provinces. Of this, the Eastern Cape would be responsible for close to R39bn, or almost a third of the total amount.
The province has already had to fork out close to a R921m in this period after the Eastern Cape High Court (Makhanda) shot down the provincial Health Department’s attempt in June to block people who won their negligence cases from claiming any money. The department argued in court that this amount — about 3.5% of its budget for this period — could topple its already precarious health system and therefore they should be exempted from paying claims.
But corruption is not the only reason for spiralling legal costs, the SALRC’s Van Zyl says.
Reports by the Office of the Public Protector, the Human Rights Commission and the Treatment Action Campaign reveal overcrowding, a lack of leadership at health facilities, poor supervision of staff and inadequate management of risks and complaints dating back from 2007.
Says Van Zyl: “Many of the shortcomings identified in 2007 and 2009 have not yet been addressed and are still prevalent.”
SALRC’s 2021 discussion paper warns: “A number of the provincial Departments of Health have neither the skills nor the capacity to address the issues highlighted in (such) reports.”
All of this is worsened by disorganised and ill-prepared government lawyers. Inertia, lethargy, wasted costs and incompetence are among the allegations levelled at The Office of The State Attorney.
The Health Department now plans to change the laws to cut the government’s responsibility for medical negligence that happens at its facilities, but some experts say a better goal would be to improve services so there’s less medical negligence in the first place.
Overburdened staff and negligence go together
Doctors in South Africa’s public sector work under extreme conditions, and are often punished for exposing it.
One of Bolton’s colleagues at Rahima Moosa, paediatrician Tim De Maayer, was suspended in May (and reinstated a month later) after writing a scathing open letter that detailed, among other things, infections that “spread like wildfire” through the neonatal ward due to poor hygiene, broken equipment, electricity outages and overburdened staff.
Now, back at his desk on the first floor at the hospital, he cautions: “We’ve seen a massive increase in litigation.
“By virtue of being a public service in an adversely constrained environment, there’s going to be negligence happening on a daily basis. Not necessarily the doctor or the nurse but it’s the infrastructure in which we work, the lack of resources… it’s inevitable things go wrong.”
But the problem with improving the quality of care at hospitals, the national Health Department’s Rennie argues, is that provincial governments need budgets to do it, and lots of that money is disappearing into medico-legal claims.
“These two problems must be addressed simultaneously,” she says.
There are, however, already a few plans drawn up specifically to cut down on medical negligence costs by improving both the quality of health care and of state litigation.
For example, the 2016 Medico-Legal Summit Declaration, developed by a ministerial task team, listed ways for hospital staff to improve patient safety (while they undergo medical treatments) and to reduce the theft of records (for instance, by changing people’s job descriptions to include record-keeping as a responsibility).
In February, the Intergovernmental National Litigation Forum was created in part to improve state legal services. The Forum will help government departments work together to avoid legal costs resulting from inefficiency. In a speech Ramaphosa made at the Forum’s inauguration, he said government bungles once resulted in a R100m claim against the state shooting up to nearly R1bn.
But Van Den Heever says the state is in denial of its failures. What the health system really needs, he says, is stronger leadership structures that hold the clinical staff accountable for medical negligence and leave fewer loopholes for collusion.
“The department is not actually talking about how they will stop the negligence. They are just trying to make medical negligence cheaper.”
Should medical negligence be cheaper?
The State Liability Amendment Bill of 2018 plans to decrease how much responsibility the government must take for mistakes at its facilities by limiting the size of medical negligence payouts (for claims over R1m).
One way, the Bill says, is to cap the payments that the government must pay if a victim needs private sector services. The new Bill says the state only has to pay the amount the same service would have cost at a public facility.
The Bill was rejected by Parliament in January last year, because the Portfolio Committee on Justice & Correctional Services wanted the SALRC to complete an investigation first (which it completed in October 2021). Once the draft legislation is reintroduced as a White Paper, the reworked Bill must then be passed by both houses of Parliament — the National Assembly and the National Council of Provinces — before it can be signed into law.
The draft legislation also proposes that the Health Department pay those who win medical negligence cases in a manner other than one lump sum, although the Constitutional Court ruled in 2021 that judges can choose what type of payment(s) the government must make based on the arguments made in court.
If the Bill goes through, it will override the Constitutional Court’s ruling (which gives courts the option to choose what kind of payment works best) and instead make “structured settlements” compulsory for all cases with payouts of more than R1m. That means all such medical negligence payouts will be in the form of smaller amounts paid over time.
The document also proposes to make payouts cheaper by outlawing payments to victims of medical negligence who have died.
In 2021, the Health Department told a Justice Department Portfolio Committee that lump sum payments often end up benefiting claimants’ estates, rather than victims themselves, as claimants frequently don’t live long after the court rules in their favour.
As part of an investigation commissioned by the then-Minister of Justice, Michael Masutha, Van Zyl and her colleagues at the SALRC recommended in their 2021 report that the payments be split into three parts.
One part is processed immediately, the second is paid through periodic payments, and the rest of the amount is paid out as “in kind” contributions, meaning the claimant would receive services from a public establishment instead of getting money they could use to go to a private sector doctor.
The SALRC reasons that periodic payments would protect patients from the pitfalls of calculating medical negligence claims, Van Zyl said. “More than 50% of the money paid out in a lump sum is swallowed by legal fees.”
As a result, many claimants run out of money quickly and then “double dip” by applying for a government grant.
From the national Health Department’s perspective, this set up would be a more practical and reliable way to ensure people receive the money and services they need, Rennie says.
“Smaller payments might even deter unscrupulous lawyers pursuing large payouts.”
But the plan has drawbacks, says Assa.
The Society believes smaller payments force people who are entitled to a payout to rely on the government to follow through with the continued deposits. It also doesn’t factor in the unexpected costs that might arise, like costly emergency treatment which large, once-off payments would be able to cover.
Malpractice & collusion – a scourge people won’t talk about
Bhekisisa spoke to 10 medical practitioners who would not go on the record about the collusion, or malpractice they’ve witnessed, even anonymously. They were all worried about backlash from the Health Department, which has strict rules about speaking to the media.
Calling out corruption and poor quality healthcare (in public) is not for the weak, says Bolton. “Not everybody understands it. They say where is your loyalty? This is our hospital, this is our livelihood. Don’t air our dirty laundry in public.”
Bhekisisa article – The plan to stop SA’s fake medical negligence claims (Open access)
See more from MedicalBrief archives:
Provinces ignore system to slash medical negligence claims
SIU to probe suspicious medical negligence claims
Court blocks Eastern Cape’s attempt to stop medical negligence payments
R37m medical negligence award overturned despite state admission of liability