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IOL News
07-07-2025
- Health
- IOL News
Probe finds evidence of racial bias against black healthcare providers by South Africa's medical schemes
Health Minister Dr Aaron Motsoaledi has received the long-awaited report which confirmed allegations of racial discrimination and unfair practices by some of South Africa's leading medical schemes against Black healthcare practitioners. Image: Oupa Mokoena / Independent Newspapers The Board of Healthcare Funders (BHF) has firmly rejected the long-awaited Section 59 report, which on Monday found positive and glaring alleged racial bias and discrimination by medical health schemes against black health professionals. Presented by panel chair Advocate Tembeka Ngcukaitobi, the report found systemic procedural unfairness and a deeply entrenched power imbalance that over the years has disproportionately and negatively impacted black medical professionals. The inquiry commissioned by the Council for Medical Schemes (CMS), launched in 2019, scrutinised practices by medical aid schemes such as Discovery, Medscheme and the Government Employees Medical Scheme (GEMS) between 2012 and 2019. "We confirm the findings and recommendations in the interim report, that the procedure followed by medical schemes when they claw back monies allegedly owed by practitioners or when they investigate instances of fraud, waste, and abuse is unfair," said Ngcukaitobi. On Monday, Minister of Health Dr. Aaron Motsoaledi, made the report public after receiving the investigation report on the findings of the inquiry conducted by the Section 59 Investigation Panel into allegations of racial discrimination by medical schemes. The inquiry was launched after doctors and other practitioners accused medical aid administrators of unfairly targeting them with audits, delaying payments or terminating contracts without clear justification. This comes after some black healthcare providers and members of Solutionist Thinkers and the NHCPA (National Health Care Professionals Association), in 2019, made allegations that they were being treated unfairly by schemes and administrators, based on race and ethnicity. The written submissions alleged that the schemes were intimidating and bullying providers through the implementation of their FWA systems (used by schemes and administrators to detect, investigate and determine providers), including by refusing to reimburse providers directly and coercing them into agreeing to acknowledgment of debt (AODs). The schemes were alleged to be treating providers unfairly and in particular were alleged to be targeting black providers. The NHCPA explained that it had anecdotal evidence that the schemes' forensic audit process was more prevalent among black providers and pointed out that the panel could obtain empirical information through its investigation. The report's statistical risk ratios developed during the investigation found that black practitioners were significantly more likely to be flagged, investigated, and penalised compared to their white counterparts. It found that in 2014 at GEMS black dental therapists were up to 3 times more likely to be flagged, while for Discovery in 2017, the report found that black psychiatrists were 3.5 times more likely. For Medscheme in 2018, the report suggests that black anesthetists were 6.5 times more likely to be found guilty of fraud, waste, and abuse (FWA). "Let me repeat this, we were not a court, we did not adjudicate individual complaints, we did not run a trial and make findings about unfair discrimination in terms of Section 9 or the Pepuda Act, we only considered the facts and the facts lead us to one conclusion that the evidence of the risk ratios before us showed racial discrimination to black service providers by the schemes. "These risk ratios are not scientific certainties, but they are highly probable indicators of discrimination," Ngcukaitobi added. While still studying the report, the BHF, a nonprofit company representing medical schemes and administrators, said it firmly rejects the findings of the final Section 59 investigation. "We still need to study the final report; however, we are disappointed that the Section 59 Inquiry panel has confirmed that it has upheld the findings made in the interim report released in 2021. We believe these findings are demonstrably and fundamentally flawed and, if allowed to stand, will open the door for runaway fraud and corruption in the healthcare sector," it said. On alleged fraudulent claims, the BHF stated: "Fraudulent claims, over-servicing, abuse of benefits, and improper billing practices cost South Africa's medical schemes around R30 billion each year. These losses directly impact the contributions and benefits of 9.7 million scheme members, the majority of whom come from historically disadvantaged communities. Fraud, waste, and abuse (FWA) inflate healthcare costs, reduce member benefits, and drive up premiums, placing disproportionate financial strain on working-class families." The issues the BHF raised with the panel's methodology included: Unscientific methods to assign race, using surnames to categorise providers; Failing to account for exposure bias, which occurs when a group is more likely to be involved in a process or activity simply because of greater contact or interaction; and Confusing correlation with causation, by assuming discrimination without 'rigorously considering other relevant variables such as provider billing patterns, patient load, or socioeconomic contexts'.
News24
14-06-2025
- Health
- News24
SA's medical schemes look to insurance top-ups as membership age increases
Medical schemes are increasingly designing options with gaps in cover that require insurance policies, resulting in consumers increasingly paying for cover in line with their health risks, a leading medical scheme conference heard this week. Hybridising medical scheme membership with insurance policies, such as primary healthcare plans or gap cover, is at odds with the cross-subsidies that medical scheme regulation sought to introduce. However, schemes are increasingly finding they have no choice but to design options in this way to attract younger members, Christoff Raath, the joint CEO of Insight Actuaries and Consultants, told the Board of Healthcare Funders conference held in Cape Town this week. The broken, incomplete and unsustainable medical scheme regulatory system has resulted in schemes becoming increasingly unaffordable and unattractive to younger, healthier people, Raath explained. More than 4.5 million of them have chosen not to join a medical scheme. This anti-selection by younger, healthier members has created a 32% difference between average contributions on open medical schemes and restricted medical schemes, Raath told the conference. Employees are often obliged to be members of restricted schemes, but in open schemes younger members opt out resulting in the average age of the nine million lives covered increasing each year, Raath explained. Every year for the past two decades, the impact of members' aging on contributions is between 1.5% and 2%, Raath said. This issue has now reached a breaking point resulting in structural changes because schemes just cannot continue to deal with the aging of their membership in the absence of risk equalisation and mandatory or compulsory cover, Raath said. Top up with insurance Schemes are designing options that advertently or inadvertently have gaps in their benefits or co-payments, that can be plugged with either primary healthcare plans or gap cover, Raath told the conference. Combining these products provides cheaper cover for younger, healthier lives. Healthcare brokers who sell insurance and medical scheme cover also earn more commission, he noted. Primary healthcare insurance plans were meant to be converted to low-cost medical scheme benefit options and boost cross-subsidisation within schemes. However, this proposed regulation of these options has been under discussion since 2005, and the most recent proposals were only released in February this year after the BHF challenged the Council for Medical Schemes and the Minister of Health over their failure to proceed with this regulation. Siphosakhe Phakathi, a senior associate at Werksmans Attorneys, told the conference that the BHF's court application was for a review of the council's decision not to exempt schemes from providing all the prescribed minimum benefits (PMBs) on their low-cost benefit options Raath said the estimated average cost of providing the PMBs is currently about R1 400 to R1 500 a month, which makes these benefits too costly for low-cost options. Phakathi said the application also sought to review the council and health minister's failure to finalise and implement regulations for low-cost benefit options. Low-cost case The application was dismissed on 1 April this year. The BHF has, however, appealed as it believes the judgement was flawed and the council and minister's decisions frustrate an important constitutional right to improved access to healthcare for millions of South Africans. Phakathi says if primary healthcare plans are converted to medical schemes, members can claim tax credits, there will be improved oversight, risk pooling will improve, and preventative healthcare will reduce healthcare costs. Phakathi said the government's support for NHI was the real reason for failing to implement the low-cost benefit options. It does not suit the government's policy of rolling out NHI to increase medical scheme membership, she said. While medical schemes have been denied the right to offer low-cost benefit options, insurers enjoy an exemption from the Medical Scheme Act allowing them to offer low-cost primary healthcare plans that ordinarily would be regarded as doing the business of a medical scheme. The exemption was first granted in 2017 and was recently extended to 2027. Over this decade, use of these insurance products has grown to cover an estimated 1.5 million lives, despite the Council for Medical Schemes' finding that the cost of these products is high. Slow death for schemes Raath said schemes are being forced to compete for younger members by hybridising membership and insurance products, because of the incomplete regulatory system that has created a slow death spiral for schemes. It is tragic, Raath said. Actuaries warned that schemes would enter a death spiral when the Medical Schemes Act was implemented in 2001 with regulation intended to ensure older, sicker South Africans do not pay more for cover and enjoy minimum benefits, but without key mechanisms to ensure schemes regulated this way were sustainable. The Act obliges schemes to charge all members the same rate to belong to an option, regardless of their state of health or age – a principle known as community rating. Contribution rates can only be based on the number of dependants you register and on your income. Income based contributions ensure that higher earners subsidise lower earners. Open schemes are also obliged to admit anyone who applies to join or, in the case of a restricted scheme, anyone from the employer or industry group for whom the scheme was established. This is known as open enrolment. But Raath says obliging schemes to comply with these principles and provide minimum benefits, without making membership of schemes mandatory, has led to members selecting against schemes – joining only when they are sick and in need of benefits. In addition, it costs schemes with many older sick members more to provide the minimum benefits on average than it costs a scheme with younger, healthier members. The costs of the minimum benefits should have been equalised through a risk equalisation fund. But plans to introduce this fund were scrapped when the government decided to pursue NHI in 2007. NHI's survival In another presentation to the BHF conference, Vishal Brijlal, senior country advisor for the Clinton Health Access Initiative, warned against allowing the status quo to continue. 'Without active reform, the sector may collapse before NHI arrives,' Brijlal said. He said the long timelines for NHI – at least 10 to 15 years — should be recognised and instead of allowing the private health sector to drift, it should be prepared and aligned to be ready for NHI in a way that makes sense. If the private healthcare system is allowed to collapse, nine million members will lose their financial protection and there will be a further burden on the unprepared public healthcare system. Brijlal said the risk of allowing medical schemes to become increasingly unaffordable is that the market for private providers dwindles and is no longer viable. However, a sustainable private healthcare sector is required to serve the NHI, he said. The Competition Commission's Health Market Inquiry's findings were that 'regulatory failure by the government was a central problem' in the private sector. Instead of ignoring reform, governance and oversight should be strengthened, competition improved and the foundation for a more inclusive and sustainable healthcare system, should be built, Brijlal said.
Mail & Guardian
19-05-2025
- Politics
- Mail & Guardian
Ramaphosa says decision to sign NHI Bill was politically sensitive
President Cyril Ramaphosa President Cyril Ramaphosa has argued in papers filed to the Pretoria high court that its ruling compelling him to submit his record of decision on assenting to the He is appealing the court's order to hand over the record to the supreme court of appeal (SCA) but indicated that he would also appeal directly to the constitutional court by 27 May. Should the apex court grant him direct access, the president said he would not persist in his application to the SCA. Ramaphosa argued that the high court made grave errors in law when, in a ruling handed down on 6 May in favour of the Board of Healthcare Funders (BHF), it held that his decision was reviewable and ordered him to hand over the record within 10 calendar days. He advanced 10 grounds of review, including that the court lacked jurisdiction in the matter and erred in finding that his decision to sign the NHI Bill into law was reviewable. Because BHF alleged a failure by the president to fulfil his constitutional duty, Ramaphosa submitted, only the apex court could hear the matter because it alone has the power to determine whether that is so in terms of section 167(4)(e) of the Constitution. His counsel had argued before the high court that the obligation imposed on the president in section 79 of the Constitution to assent to legislation was assigned only to himself, or an acting president in the case of his absence. Therefore any breach of this obligation triggered the exclusive jurisdiction of the constitutional court. They further argued that when deciding whether to assent to a law, the president was exercising a subjective discretion bestowed on him by section 79 of the Constitution. It was up to him to decide how he went about reaching his decision and an attempt to review this decision in court had significant implications for the separation of powers. Allowing a high court review would also mean that any person who was unhappy with his decision to sign a Bill into law and had enough money to launch litigation could embark on a courtroom 'fishing expedition' to find a flaw in his reasoning. In this instance, the president's lawyers argued, the BHF could not point to any reviewable lapse in the process he had followed, yet was trying to halt a legislative process designed to meet the healthcare needs of the whole country. The BHF, which represents most private medical schemes in South Africa, had argued that Ramaphosa flouted his constitutional duty by failing to scrutinise the constitutionality of the NHI Bill. It said he acted irrationally when he The court found no merit in the president's argument on the separation of powers, and said the step of assenting to a Bill was but part of a lawmaking process that was a reviewable exercise in public power. 'The issue is whether the president has properly applied his mind as required by section 79 of the Constitution when he assented to and signed the NHI Bill after receiving all the objections to the constitutionality of the Bill from the stakeholders including his own legal advisers,' the court said. 'This cannot be said to be intruding into the domain of the principal legislative and executive organs of state which would bring the matter into the remit of the exclusive jurisdiction of the constitutional court.' It held that a legislative process implies a shared obligation on the National Assembly, the National Council of Provinces and that hence, the case fell within the jurisdiction of the high court. As to whether Ramaphosa's decision was reviewable, the court said he exercised the power to sign Bills as a central part to a legislative process. And since all public power must be exercised within the bounds of legality, and this particular one within the constraints of section 79(1) of the Constitution, it was subject to legal review. Ramaphosa challenged this in the application for leave to appeal filed last week. 'The court reasoned that the president's obligations are not agent-specific and do not engage the exclusive jurisdiction of the constitutional court,' he submitted. 'Respectfully, the court ought to have found the opposite.' The court was inconsistent, because on the one hand it said the case revolved around his duty, in terms of section 79, to scrutinise the constitutionality of the Bill, yet on the other that the 'conduct which is challenged by the applicants in this case does not fall in the category of the president's failures in fulfilling his constitutional obligations'. Both could not be true at the same time. Nor could the court rightly find that assenting to a law was not 'agent-specific' when only the president had the power to do so. Furthermore, Ramaphosa submitted, the separation of powers was implicated because the function he performed in signing a Bill into law was not a legislative one. 'If it were, that would constitute a demonstrable incursion into the terrain of the legislature and breach the separation of powers.' Ramaphosa argued that assenting to legislation was a politically sensitive matter, where it was left to the president to determine which considerations he had to bear in mind when fulfilling a particular obligation. It meant 'sensitive' not in a party political sense but in the context of separation of powers in that a court had to exercise 'extreme caution in determining whether it is capable of second-guessing or assessing' his decision. The high court had ignored a warning from the apex court, through case law, that in such matters, 'which are by their very nature politically sensitive matters', only it had jurisdiction. The president signed the Bill into law a fortnight before last year's general elections. Critics of the decision have said it was a populist move at a moment when it was clear to the ANC that it risked losing its majority. The legislation has remained one of the main
Eyewitness News
17-05-2025
- Health
- Eyewitness News
Ramaphosa eyes direct appeal to ConCourt over NHI Act challenge
CAPE TOWN - President Cyril Ramaphosa is seeking to appeal directly to the Constitutional Court after a high court found that his decision to sign the National Health Insurance (NHI) Act into law could be reviewed. Ramaphosa on Friday filed notice to appeal the Pretoria High Court's earlier decision that also gave him ten days to provide the record of his decision to sign into law the highly contentious NHI Act in 2024. Ramaphosa's decision was challenged by the Board of Healthcare Funders (BHF), which contends that the legislation is "vague, unaffordable, and ultimately unworkable". ALSO READ: - BHF confident it will be able to prove the NHI Act is unconstitutional - NHI Act: BHF expecting Ramaphosa to ignore Friday's deadline to comply with court order - Board of Healthcare Funders set to file two more legal challenges to NHI Act In court papers, Ramaphosa pointed to inconsistencies in the court's decision and how the president could exercise his powers. Ramaphosa also said that the role played by the president in assenting to and signing a bill was not that of legislating. "If it were, that would constitute a demonstrable incursion into the terrain of the legislature and breach the separation of powers," argued Ramaphosa. Ramaphosa listed several grounds for leave to appeal, including how the court erred in failing to take into account the discretion enjoyed by the president. Ramaphosa said by permitting this kind of review, the court had potentially allowed a "pre-enactment challenge to a bill, which is a severe threat to the legislative authority of Parliament," which he said the Constitution had already warned against. He said that previous court decisions had found that the president and the president alone assented and signed bills into law.
Eyewitness News
15-05-2025
- Health
- Eyewitness News
NHI Act: BHF expecting Ramaphosa to ignore Friday's deadline to comply with court order
CAPE TOWN - The Board of Healthcare Funders (BHF) says it expects the president will ignore Friday's deadline to comply with a court order to provide the record of decision that led to him signing the National Health Insurance bill into law. Instead, it expects he and the health minister will file for leave to appeal last week's judgment of the North Gauteng High Court that it has the jurisdiction to review his decision-making. On Thursday, the BHF, which represents private medical aid schemes, announced it will be launching two more court cases against the constitutionality of the National Health Insurance (NHI) Act and the public participation process that preceded it. Last week, the high court found that Ramaphosa's decision to assent to and sign the NHI Act into law is reviewable. READ: Board of Healthcare Funders set to file two more legal challenges to NHI Act It gave him 10 calendar days to furnish the court with the record of his decision. The BHF expects this record could bolster its subsequent cases challenging the public participation process that led to the passing of the bill, and even after, when the sector petitioned the president to consider their concerns and objections. But on the final day of its annual conference in Cape Town on Wednesday, BHF lawyer Helen Michael was doubtful the judgment would be adhered to. "If we are all being frank, I would probably say that's unlikely. The problem the president does face if he fails to file the record is that he opens himself up to a contempt of court application." The South African Private Practitioners Forum and the South African Medical Association have also launched their bids against what they believe is the unconstitutionality of the NHI Act.
