Report finds racial bias in medical schemes remain
An independent panel investigating racial bias in South Africa’s medical aid schemes has reaffirmed its earlier findings that Black healthcare providers were disproportionately accused of fraud, waste, and abuse (FWA) from 2012 to 2019.
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While the report acknowledges some improvements since 2020, it argues that systemic inequities continue to exist.
“Black providers were significantly more likely to be found guilty of FWA than their non-Black counterparts,” said Advocate Tembeka Ngcukaitobi, citing an alarming risk ratio.
The investigation, spanning several years, analysed data from major medical schemes, including Discovery Health, Medscheme and Gems, covering the period from 2012 to June 2019.
Statistical analysis conducted by Dr Zaid Kimmie, the panel’s expert, showed that Black providers were up to three times more likely to be found guilty of FWA by these schemes.
For certain disciplines, such as physiotherapy and psychology, the risk ratios were even higher, reaching levels of six to 12 times greater likelihood.
Racial bias
The probe comes after Black healthcare providers and groups like Solutionist Thinkers and the National Health Care Professionals Association (NHCPA) accused medical schemes of racial bias in fraud investigations in early 2019.
The Council for Medical Schemes (CMS) launched an independent probe, forming the Section 59 Investigation Panel, which collected hundreds of submissions alleging unfair targeting of Black practitioners through forensic audits and coercive agreements.
The affected parties appealed to the Minister of Health Dr Aaron Motsoaledi for intervention.
The three-member panel included Ngcukaitobi, the chairperson of the Section 59 Investigation Panel, Advocate Adila Hassim, and Advocate Kerry Williams.
The three advocates completed their work and submitted the final report, including findings and recommendations, to the minister of health for consideration.
The panel reiterated key recommendations from its interim report, including early warning systems to notify providers of potential FWA concerns before sanctions and a review of audit periods, arguing that clawing back three years of claims can cause undue hardship.
“We had terrible evidence here about medical providers that are forced to close down their practices because they simply cannot afford to carry on if they are not supported by medical aid schemes, and in circumstances where they have to pay back the money that has been clawed back by the schemes, some of them can’t even afford to pay for their families,” explained Ngcukaitobi.
They also suggested mediation support to ensure fair negotiations between schemes and accused providers.
“There is a need to ensure equality of arms between schemes and providers,” the report emphasised, though it stopped short of prescribing a specific mediation model.
The probe found that these systems disproportionately impacted Black providers, undermining their dignity and professional standing.
The CMS has been urged to implement more rigorous annual monitoring of racial risk ratios across different medical disciplines to prevent future discriminatory practices.
Further reforms needed
While the panel noted some procedural improvements by medical schemes, it stressed that further reforms are needed to address historical biases in fraud detection systems.
Since the publication of the interim report in 2021, some schemes have implemented changes to their FWA systems.
According to the report, Medscheme introduced a new artificial intelligence-driven system called DOTS, while Gems revised its communication practices to foster collaboration with providers.
Discovery Health established a Health Professionals Reference Group to improve fairness in forensic processes.
However, the panel noted that significant gaps remain, particularly in ensuring transparency.
The report stressed the need for ongoing monitoring of FWA systems to prevent discriminatory outcomes and uphold constitutional principles of equality.
The panel emphasised that while they were not a court of law, their findings demonstrated systemic inequities in how medical schemes treat healthcare providers based on race.
Dismantling healthcare systems
Motsoaledi has since emphasised the urgent need to dismantle two distinctly separate healthcare systems and that is, one for the wealthy and another for the poor.
The minister described this as 'very painful' and stressed that the current healthcare landscape mirrors the pre-1994 fragmented system of 14 separate health departments.
Meanwhile, Motsoaledi has committed to reviewing the entire healthcare ecosystem and addressing challenges with medical scheme regulations and payment practices.
In addition, he also touched on plans to integrate healthcare systems through initiatives like the National Health Insurance (NHI).
The minister warned that while the report has been handed over, potential legal challenges might still arise, particularly when implementation of recommendations begins.
However, he believes that the investigation represents a significant step towards addressing systemic inequalities in South African healthcare, signalling potential major reforms soon.