Medical aid fraud. Picture: THINKSTOCK
Medical aid fraud. Picture: THINKSTOCK

The Government Employees Medical Scheme (GEMS) believes it has lost at least R10m in fraudulent claims for hospital stays.

GEMS had uncovered evidence that pointed to healthcare practitioners and members as the culprits, Principal officer Dr Guni Goolab said on Tuesday.

The evidence came to light in a widespread review of claims submitted by a variety of service providers, including a number of in-hospital claims.

Goolab said GEMS had discovered a number of instances where claims were irregular or questionable.

In some of the cases investigated, patients had not undergone any significant pathology or radiology tests following admission to hospital, even in instances where they were reportedly seriously ill.

Hospital cash-back plans are intended to help members pay medical bills not covered by medical aid, or to subsidise income lost during a hospital stay.


The investigation revealed that GEMS was being used to fund medical conditions that could either have been treated within a shorter period, or more effectively with alternative treatment regimes; or to fund treatments that may never have been necessary in the first place.

The Health Professions Council of SA (HPCSA) will look into the allegations of GEMS fraud. It said it would institute an inquiry under Section 41 of the Health Professions Act, which empowers professional boards to institute inquiries into complaints.

Goolab said some of the healthcare practitioners implicated by the investigation had signed acknowledgments of debt after follow-up interviews. These alone amount to at least R10m, and included:

• Two physiotherapists (acknowledgment of debt values: R502,000 and R350,000);

• a dietician (R150,000);

• four psychologists (R1.5m, R600,000, R2m and R240,000);

• two physicians (R2m and R700,000); and

• A surgeon (R3m). 

“To date indications are that there is substance to the allegations levelled at the identified healthcare facilities and service providers. Affidavits obtained, including data analysis, indicate that there is sufficient  evidence that would warrant the pursuing of criminal charges against certain individuals and institutions,” said Goolab.

Daphney Chuma of the HPCSA said the council believed GEMS would take further steps under the Prevention and Combating of Corrupt Activities Act of 2004, by reporting healthcare providers to the police, where the fraud or theft involved R100,000 or more.

Fraud waste and abuse is a challenge for all medical Schemes and losses may vary between 5-15% every month, Goolab said.

The financial consequences of this abuse include possible premium increases; more thorough validation processes for hospital authorisation requests; more stringent criteria for accepting members to a scheme; and, for perpetrators, criminal prosecution.

The current indication was that fraud was committed by scheme members as well as medical practitioners, and healthcare professionals and patients might be colluding, he said.

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