Health insurance fraud occurs worldwide, says Cimas audit manager

Fraudulent medical aid and health insurance frauds are not a function of the economy, Cimas group internal audit manager Thando Kembo told journalists at a recent ZimSelector Journalists Insurance Mentorship Programme workshop. They occur, she said, worldwide.

Experts estimated that between 30 and 40 percent of medical aid claims in Southern Africa were fraudulent. Globally the figure was about 10 to 20 percent, she said.

Based on the higher end of the Southern African estimate, this would mean that about $40 million worth of claims paid by Cimas alone in 2015 and $37,2 million in 2016 were fraudulent.

That was a considerable sum, equivalent to more than 12 percent of the government's budgeted healthcare expenditure for 2016 or 19 percent of the budgeted expenditure for 2017.

Fraud referred to an act committed to secure personal or financial advantage. "It's just someone who has found a way of getting more money than they should," she said.

Medical aid fraud could be perpetrated by service providers, medical aid society members and staff, she said.

Fraud by service providers included submitting claims for services not rendered, charging for branded medicines when the cheaper generic medicines had been dispensed and incorrect reporting of diagnoses or procedures. It also included misrepresenting dates, tariff times and the location of service delivery in order to charge for the service at a higher rate.

Other forms of fraud included over-utilisation of services, over-servicing through unnecessary procedures and false or unnecessary issuing of prescription drugs.

Fraud by medical aid society members chiefly involved allowing a non-member to use their membership card. Sometimes there was collusion between members and service providers in the submission of false claims.

Fraud by staff members was less common and easier to keep a check on. It generally involved soliciting for a kickback to process fraudulent claims or give favours for service delivery.

She gave as an example of fraudulent gain by service providers through unnecessary procedures in other countries, the case of a surgeon in the United Kingdom recently convicted of intentionally wounding patients by carrying out unnecessary mastectomies, surgically removing the breasts of women when there was no necessity for him to do so.

She cited too the case of a senior orthopaedic surgeon on the United Kingdom who is being investigated for billing for operations that were carried out but were suspected to have been unnecessary.

With such frauds occurring worldwide even in countries with sound economies, it was unlikely that fraudulent claims would go away. It was, she said, like a chronic disease.

Steps that Cimas had taken to deal with this included educating members, service providers, staff and the public on common fraud schemes so that they can look out for them. Cimas was also continuously improving its own controls to safeguard members' funds against any malpractices that came to its attention. It was also engaging global players in order to remain informed about common fraud schemes in other parts of the world.