CMS investigates Discovery Health's co-payment recovery claims

The Council for Medical Schemes (CMS) says it will investigate claims that Discovery Health Medical Scheme (DHMS) is seeking to claim co-payments back from its members due to an error at South Africa's biggest medical aid in December.

The CMS said it had received no formal complaints from Discovery Health's members who had alleged claims processing errors, but Medicheck, a consumer health advocacy organisation in South Africa, had subsequently lodged a concern with the regulator.

DHMS has sent communication to about 0.6% of its members requesting them to repay co-payments after a processing error saw claims incorrectly paid out at a higher rate than their plan's benefits allow. Media reports suggest Discovery is claiming as much as R22 000, R25 000 and R37 000 back from some of its members.

The error is related to the Above Threshold Benefit (ATB) on the Executive, Classic Comprehensive, Classic Smart Comprehensive, Classic Priority and Essential Priority plans. The claims appear substantial considering annual contributions for a main member on the Classic Comprehensive scheme amounts to about R83 700 respectively.

MediCheck argues the liability for the mistake should sit with Discovery.

CMS said Medicheck had raised concerns that included allegations concerning systemic claims processing errors, and associated recovery mechanisms.

Medicheck has also raised questions of compliance with Regulation 6 of the Medical Schemes Act and the applicable scheme rules, and issues relating to governance and administration oversight under section 57 and Regulation 17.

Regulation 6 of the Medical Schemes Act deals with the Prescribed Minimum Benefits (PMB's) and requires medical schemes to cover the costs of diagnosis, treatment, and care for PMB conditions in full, subject to the scheme's rules and designated service providers.

The CMS said the Act does allow recovery of funds that have been paid to a member, to which that member may not have been entitled.

"However, as a general principle, a scheme is expected to set clear parameters around Section 59(3) recoveries/deductions to properly govern the process, ensuring transparency, fairness, courtesy, and clear communication with members," CMS said.

Discovery Health and DMHS told Business Report fewer than 0.6% of members were impacted, and they apologised for the inconvenience caused.

"All affected claims have been corrected, members are receiving proactive support, and stronger controls have been implemented to prevent a recurrence," the company said in a statement.

"We recognise that unexpected adjustments can affect personal budgets and planning, and we are working closely with each affected member to manage this in the most appropriate and supportive way," it said.

The company said its rules state that if, for any reason, the medical aid pays an amount more than which it is liable to pay for a claim, then the scheme can recover this through payments due to the member. "Additionally, Rule 16.4 states… the amount of such overpayment is recoverable by the scheme."

"All recoveries are being managed strictly in accordance with the Medical Schemes Act, Council for Medical Scheme rules and regulations, and DHMS' Rules 15.5 and 16.4," Discovery said.

The CMS said in a statement: "While we appreciate the public alerting the regulator on this matter, these concerns will be addressed in accordance with CMS's statutory mandate and processes."

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