Losses close to R4 bln
MEDICAL AID: Fraud so big it ‘cannot be quantified’
FRAUD had gained an unhealthy foothold in the private healthcare industry to such an extent that it could not even be quantified, said Dr Guni Goolab, principal officer of the Government Employees Medical Scheme (GEMS).
“The lesson is clear: we have to give voice to our absolute opposition to medical schemes abuse and fraud.” he said in his closing address at the scheme’s annual conference held in Cape Town this week.
“It has been estimated that losses due to fraud in South Africa are in the region of R4,1 billion. This is much too high a price to pay, particularly for a fledgling economy such as ours,” he said.
Dr Goolab said fraud artificially inflates healthcare costs. The higher the cost of fraud the less there is available to spend on members’ healthcare needs, he said.
Members of medical schemes had the right to know what was happening to their contribution fees and what was being done to stem the unwelcome tide of abuse and fraud.
“We need to engage members fully in our quest to diminish this scourge. But first and foremost, we need to understand the true extent of the problem. That is why something tangible needs to be put in place at industry level to record and report actual losses as a result of fraudulent activity.
“At present one of the greatest challenges in the industry is a lack of co-operation and involvement on the part of members,” he said.
“Member education programmes and active engagement can go a long way towards improving this situation. Members must fully grasp what is at stake and need to understand the criminality of fraud and medical schemes abuse.”
Dr Goolab said members still perceived medical schemes fraud as a victimless crime. They mistakenly believed that by perpetrating this crime no real harm was being done.
Peter Goss of PricewaterhouseCoopers (PWC) said at the conference that “a game changer” was needed when it came to medical schemes fraud.
He said that fraud was an act of depriving people of a fundamental human right.
One way of putting it to an end is to make it an obligation to report medical schemes fraud by rendering it a statutory offence, he said.
— Fin24 and Witness Reporter.