Medical schemes risk ruining their reputations through greed

The CEO of one of SA’s biggest medical schemes has warned that the sector is alienating customers with what looks like profiteering and catering for SA’s elites. As a result, the schemes unintentionally bolster support for the same Natinal Health Insurance (NHI) that will put them out of business.

Bestmed CEO Leo Dlamini said this week that successive hefty rises in membership fees badly harm the medical aid sector’s reputation. They reinforce in the public mind the idea that the NHI is a cure-all for the nation’s health care issues.

“We run the risk of an industry that’s unaffordable. It doesn’t help the narrative against the NHI,” he says.

Dlamini defends the fee increases as inescapable because of medical inflation. That is aggravated, he says, by a range of factors, especially the schemes’ statutory obligation to pay prescribed minimum benefits (PMBs) for a government-determined range of afflictions.

Unsurprisingly, Bestmed’s best-preferred solution is to cut PMBs.

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No one begrudges these companies a fair profit for providing medical care at a level that the state is lamentably unable to match. Admittedly, medical cover is a grudge purchase. We want the protection it provides but there is a sense we are being ripped off.

The long and the short of it is that the medical schemes regularly and illegally make deductions from the medical savings accounts (MSAs) that many have made compulsory for their members. Instead of paying for PMBs out of the scheme’s reserves, they raid the member’s MSA.

An independent financial advisor with vast medical scheme experience says this happens so often that it is difficult to believe that it is accidental.

He regularly intercedes on behalf of distressed clients. When challenged on these sharp practices, the schemes immediately back down and blame it on “administrative error”.

Consumer journalist Wendy Knowler recently recounted in her column the harrowing experiences of two patients with advanced cancer trying for years to stop Discovery from pillaging their MSAs instead of paying out the benefits according to their plans.

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“I find the ethics troubling, to put it mildly,” says Knowler. “And these are people at their most vulnerable, in a sickly state, often battling alone. Many people simply give up.”

Such callousness and greed are not confined to the schemes. Many health professionals have handed the entire account management process to medical billing companies. Whether it’s in-house collection by the practitioner’s staff or from an external company, the tone of these communications is often “clipped, rude and threatening”, says Knowler.

Medical professionals, whose entire relationship with a patient is based on trust and mutual respect, seem oblivious to the damage being done to their reputations by the blizzard of emails, SMSs and phone calls prematurely demanding payment.

The angst engendered is enormous. To make matters worse, when the patient succumbs to the harassment and there ends up being an overpayment, it is a nightmare to get the money back. Every conceivable administrative impediment is put in one’s way.

It seems unlikely that such exploitative and obstructionist behaviour would persist if it were not only tolerated but encouraged by the companies concerned.

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