Following revelations of irregularities at a Cape medical ‘aid company, the Department of Health plans to fight corruption in the industry, writes Marion Edmunds
The Department of Health is planning a crackdown on corruption in the billion-rand medical insurance industry, introducing strict new laws and policing as a priority next year.
Sources say last week’s shock disclosures in the Mail & Guardian of corruption and financial irregularities at the huge Cape-based medical aid company Pro Sano are only the tip of the iceberg, with other companies involved in more serious offences, yet to be exposed.
But the disclosures about Pro Sano’s financial irregularities and its loss of millions of rands has strengthened the department’s hand in its plans to bring the industry to heel.
Sources say the department has deliberately kept its plans low-key, so as not to jolt the industry’s powerful players.
However, the department was to host an open workshop on Friday to discuss the proposals and the question of Pro Sano.
One of the experts addressing the workshop, Alex van der Heever from the influential Centre for Health Policy, said the Pro Sano case demonstrated the need for a review of current legislation and a rethink on the role of medical aid schemes.
‘Given that Pro Sano is the one medical scheme that did not get away, its case demonstrates the need to have regulations to prevent things reaching the stage they did,’ he said.
‘I think it is the government’s responsibility to protect consumer rights and the intermediary has not been acting in the interests of the consumer,’ he said.
Van der Heever is also a member of the Council for Medical Schemes. He said the government lacked the capacity and legislation to deal with the industry that was driven more by profit than a desire to protect members.
‘The industry is fragmenting and corruption here could be seen as symptomatic of the fragmentation because people can shift fragments around to their own benefit,’ Van der Heever said.
‘We can either define the relevant legislation more strictly to ensure uniform transparency, or we can deregulate and let people sort themselves out and say ‘Buyer, beware’, but we don’t really think that that is fair for the consumer. The government has a responsibility to protect the consumer.’
The department was coy about the workshop earlier this week, saying it was just a public relations exercise. The department also did not wish to comment on Pro Sano, saying it was sub judice.
Last Friday, the Supreme Court granted Pro Sano a stay of execution after the department’s registrar of medical aid schemes applied to have the fund put into judicial management.
In papers before the court, registrar Dani’l Kolver detailed a string of allegations about corruption among former Pro Sano management involving several top companies. The scheme, which provides medical benefits to thousands of public servants, has lost close to R90-million.
Pro Sano chairman Shu’ayb Patel said several of the allegations were untrue, and that he was considering suing Kolver.
Kolver was on leave and could not comment on his allegations, made under oath, and based on a forensic audit.