OPINION | Collaboration efforts key to detecting, thwarting rampant healthcare fraud, waste and abuse in SA

Fraud in healthcare is not just a financial crime, it is an assault on the moral fabric of our health systems and, more starkly, a theft of care from the patients who need it most.

The Board of Healthcare Funders (BHF) has long sounded the alarm on the scale and impact of fraud, waste and abuse. 

In just two years, fraud-specific complaints against SA medical practitioners rose by 28%, with overall professional misconduct complaints growing by nearly a quarter. These are not just bureaucratic statistics; they reflect the suffering of real people, and the weakening of systems meant to protect them.

Worse still, an estimated R30bn is lost to healthcare fraud in SA yearly. This haemorrhaging of resources directly compromises the quality and accessibility of care. Every rand stolen is a rand withheld from a life-saving procedure, a chronic illness management programme, or a critical diagnostic test.

The administrative costs required to detect, investigate, and prosecute fraud, waste and abuse only add to the financial burden placed on schemes and their members. These costs ultimately lead to higher premiums for members – many of whom come from disadvantaged communities and are already struggling to afford healthcare. This is money that could otherwise be invested in better benefits or innovative treatment models.

The horror stories unearthed during a fraud, waste and abuse Indaba held by the BHF earlier this year underscore the gravity of the situation.

In one chilling case, a doctor developed an untested procedure with no peer review or clinical basis. He exploited medical schemes using misleading codes, charged patients exorbitant prices for scans and tests, and was ultimately charged with murder after one of his patients died from unsafe, unproven treatment.

In another instance, a urologist falsified a diagnosis and carried out an unnecessary surgery to help a patient avoid deportation as the presence of a serious medical condition could qualify the patient for a medical stay or delay in immigration proceedings. This is despite initial tests revealing no medical issue. Such breaches are not just clinical errors; they are violations of trust that endanger lives and tarnish the medical profession’s reputation.

Unchecked, these can lead to the destabilisation of medical schemes, diminished trust in healthcare funding, and increased financial vulnerability for members. We are not simply dealing with financial losses; we are witnessing erosion in the very structures designed to protect and heal.

For far too long, medical schemes and administrators have tried to fight this scourge in isolation. But fraud, waste and abuse does not respect scheme boundaries. Unscrupulous providers exploit fragmented systems, moving seamlessly from one scheme to the next, often undetected. 

The BHF is spearheading a more unified, technology-driven, and data-informed approach. One where collaboration is not optional, but existential.

An example of this collective can be seen in how schemes monitor provider behaviour. Individually, schemes may notice occasional over-servicing by providers. But when 16 schemes pool anonymised utilisation data, as they recently did through a BHF initiative, a different picture emerged: 433 suspect providers were identified across 27 disciplines. In contrast, a single scheme working in isolation flagged only one provider.

The collective intervention goes beyond data pooling and allows different software systems to communicate with one another to instantly verify membership histories, helping to detect dual memberships, recycled dependants, and falsified certificates, which are all common avenues for abuse.

The second opinion programme offers a defence against unnecessary or exploitive medical procedures. It works by requiring patients to get an independent review from another qualified doctor before any expensive treatment is approved. This helps ensure that treatment is truly needed and protects both the patient and the medical scheme from potential abuse.

The introduction of an AI simulator trained on real-world fraud cases generates plausible fraud scenarios, recommends targeted detection strategies, and assists investigators in mapping out response plans.

However, critical to the success of fraud, waste and abuse initiatives is collaboration. The BHF brought together more than 40 organisations from SA, Namibia, Zimbabwe, and Botswana at the indaba to align on shared values and strategic collaboration.

Through platforms like the health sector anti-corruption forum, co-ordinated by the Special Investigating Unit, we’ve seen what joint action can achieve. Since its inception in 2019, the forum has processed 32 cases and recovered nearly R2.8bn through legal interventions.

We are not naive about the complexity of these cases. But we are also not helpless. We have the tools and the will. What we need now is an unshakeable commitment to shared responsibility.

Schemes must stop viewing fraud as a competitive concern and start seeing it as a systemic one. Members, too, must be empowered through simplified billing, anonymous tip-off lines, and educational campaigns so they become active participants in fraud detection.

The fight is not just about preserving financial sustainability. It’s about restoring faith in a healthcare system that puts patients first.

Dr Mothudi is managing director of the Board of Healthcare Funders