Health department legal claims up by R3.8 billion

Although the Gauteng Department of Health received an unqualified report by the Auditor General (AG), the legal claims against the department have increased by R3.8 billion in the last year to a total potential liability of R16.5 billion, the Democratic Alliance Gauteng’s shadow MEC for Health, Jack Bloom said.

The report was recently tabled in the Gauteng Legislature. Bloom said the report showed that there was poor control and a failure to follow procedures in a number of key areas.

“The R13.4 billion is for medico-legal claims, R1.6 billion is for civil claims and R1.5 billion for premature termination of contracts,” he said. The department’s accounting officer, Barney Selebano said in order to address the increasing medico-legal issues, the department has appointed two law firms to conduct a legal audit of all litigation matters from 2005 to date. “The objective is to reduce costs, minimise or reduce unnecessary litigation and identify key factors that contribute to litigation cases,” he said.

The department was also criticised for its irregular and wasteful expenditure. The report showed the department spent almost R500 million on irregular expenditure and R7.4 million on fruitless and wasteful expenditure. The Auditor General said effective steps were not taken to prevent irregular, fruitless and wasteful expenditure.

Selebano said in his report that the department did not record any unauthorised expenditure, but that R2.2 million of the fruitless and wasteful expenditure was due to expired medication. The other, almost R5.2 million, was attributed to infrastructure development.

The Auditor General further said effective and appropriate steps were not taken to collect all money due and interest was not charged on patient debts. Selebano explained that the collection failure was because of multiple factors such as the late implementation of the Uniform Patient Fee Schedule due to prolonged stakeholder consultation. And certain payment delays were caused by a newly implemented claims system, which further added to the department’s non-collection.

“The late billing of patients by institutions remains a concern. To address the problem, billing units of the health institution’s personnel are regularly trained and attend capacity-building programmes,” Selebano said. The report also revealed that investigations, based on the allegations of procurement irregularities, fraud, theft and negligence, are being performed by the department.

Bloom said that while there has been some improvement in the department, the Auditor General’s findings show that there was still a long way to go to achieve good management and the effective use of funds.

Gauteng Health MEC, Qedani Mahlangu said the Auditor General’s report was heartwarming, especially since the department received a qualified report the previous financial year.