Is workers’ key fund still falling down on the job?
THE new Compensation Fund commissioner, Vuyo Mafata, says it is considering the possibility of collaborating with the private sector to improve its performance.
Mafata was made acting commissioner nine months ago after research by several medical and employer associations found that the R52-billion fund, which is supposed to pay the medical bills of employees who are injured at work, was in a state of “disarray and collapse”.
The situation was so bad that doctors, private hospitals and even state hospitals were turning away members of the fund, the largest medical aid service provider in South Africa, because of unpaid claims. In some cases, service providers were still waiting for payments from the fund after 10 years.
Dealing with the fund, which is an entity of the Department of Labour, was a nightmare for members who, after a lifetime of contributions, were left high and dry in their hour of need.
Mafata says a review of the fund is under way.
“We need to see if there is scope for the private sector to play a role in the administration of claims,” he says.
The DA has called for the medical aid portion of the fund to be run by an external medical aid administrator, as happens with the parliamentary medical aid, but Mafata doesn’t agree.
“There are areas where we can collaborate with the private sector but not necessarily outsource functions,” he says.
His idea of private sector collaboration is to appoint doctors and nurses who will be employees of the fund. He says 100 medical posts have been created, although fewer than 20 have been filled so far.
But the DA’s labour spokesman, Ian Ollis, says: “You don’t need doctors and nurses, you need people who can administer a very complex nationwide system. You need administrators.”
Mafata says there has been a “significant improvement” since he became acting commissioner.
“Doctors not being paid is a thing of the past,” he says.
So why are doctors still turning away members of the fund?
“Obviously there are still doctors with scars from the past who might not want to deal with us,” he concedes.
But the fund has begun working with medical associations and hospital groups and briefs them on developments every month.
He says there are no outstanding claims. “The entire backlog was eradicated by the end of January.”
This sounds unlikely given the extent of the crisis less than a year ago, when the South African Medical Association said that 65% of medical practitioners in Gauteng alone had not been paid by the fund. The average amount outstanding per doctor was just under R900 000, and small medical practices were having to close their doors, the association said.
In September last year, it said that in spite of “repeated assurances by various officials . . . the position has not improved”.
Mafata says: “We’ve now started talking to Sama so we can get the extent [of unpaid claims] from their members.”
Doctors who submitted claims 10 years ago say they have heard nothing from the fund.
“There are some instances we might have currently because of inadequate documentation,” says Mafata. “In which case we go back to the doctor and request the information.”
He says the fund has embarked on “a wide-scale communication drive” to get doctors and hospitals who say they’re owed money by the fund to come forward with information.
In his report for the 2014-15 financial year, the auditor-general found there were poor accounting records and a lack of internal controls at the fund. Parliament’s standing committee on public accounts blamed the Department of Labour for ignoring financial mismanagement at the fund which, according to the auditor-general, had led to irregular expenditure of R1-billion and fruitless and wasteful expenditure of R12-million in the 2014-15 financial year.
The fund’s chief financial officer, Johnny Modiba, has been suspended on full pay for almost a year.
When the department was finally roused to do its own investigation into the fund it supposedly oversees, it found a lack of leadership and no systems in place to run the finances and claims management chain of the fund.
The then commissioner, Shadrack Mkhonto, brought in from the almost equally troubled Unemployment Insurance Fund in 2009 to rescue the Compensation Fund, was removed and made chief operating officer of the Department of Labour.
Mafata, who was chief operating officer of the UIF at the time, was made acting commissioner of the Compensation Fund.
He says the fund had just started implementing a new IT system for claims processing when he took over. This is the fourth attempt to implement an IT system since 2009.
“There were a number of challenges we’d had, as you will find with many IT implementations,” he says. But they’re now in the “post-teething” stage, and a turnaround is well on track.
“In the previous system everything was manual,” he says. “People had to submit manual forms and it would take time, forms would get lost and so on.
“Now employers and medical service providers all interact with us online. There’s no need for paper. The issue of forms getting lost is a thing of the past.”
The DA’s Ollis says that when he inspected the Randburg office of the Department of Labour in January, he was told that the computer system was offline for at least two days a week.
If it goes offline at Randburg, then it is reasonable to assume it is offline much of the time at other branches, as anecdotal evidence suggests.
“Networks might be a bit slow, but there are minimal problems now with the online system,” says Mafata.
As for being paperless, this was a promise Mkhonto made in 2009, and it has still not happened, says Ollis.
“It is still a paper-driven system and they still keep losing documents at regional offices around the country and applicants have to start all over again,” he says.
The Eastern Cape is particularly bad. In Port Elizabeth and East London, “if you want to claim you still have to go in and fill out the forms, they’re still being lost in the system and you have to go back and fill in the forms again”.
There are still many complaints of lost documents, unanswered phone calls and e-mails and clueless staff from around the country.
“It will take some time to get the Compensation Fund to be as efficient as everyone would want it to be,” says Mafata. “What is important is that we need to make progress towards that realisation.” He says the turnaround will be complete within 24 to 36 months. Sadly, these are the same noises his predecessor, Mkhonto, was making back in 2009.
Mafata blames “technology and people issues” for the fund’s problems.
“We’ve realised that the skills in some areas are not adequate,” he says.
A skills audit is under way “to try and establish whether people are in the right places and whether they have the right skills”.
“Based on the outcome of the skills audit we will implement interventions to help staff to get to where they need to get in terms of skills. If they have been incorrectly placed, we will move them to places where they can contribute more effectively.”
Mafata, 38, has a BCom and an MBA from the University of the Free State, and a master’s degree in finance and investment from the University of the Witwatersrand.
He says he doesn’t know why it has taken so long to figure out that people in the fund are doing jobs they are not properly qualified for.
“I have no idea.”
They interact with us online. There’s no need for paper. The issue of forms getting lost is a thing of the past It is still a paper-driven system and they still keep losing documents at regional offices around the country
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